Thread by @PolicyNextgen

EXPLAINER

Hello Folks! Kenya is a participant in global trade. The rapid shifts in the existing world trade order have led to uncertainty. Today, we delve into the position of Kenya in the global trade: 🧵

1. WHAT ARE THE VARIOUS TRADE AGREEMENTS KENYA IS PARTY TO AND WHERE DO THEY STAND?

🚚African Growth and Opportunity Act (AGOA – U.S.): AGOA gives Kenya duty-free access to the U.S. market, especially for textiles, apparel, and agricultural goods.

It has created tens of thousands of jobs, but the program is set to expire in 2025, raising major risks for Kenya’s exports. Implementation is therefore regressing, with uncertainty over a possible new Kenya–U.S. trade deal.

🚚EU–Kenya Economic Partnership Agreement (EPA): The EPA came into force in July 2024, giving Kenya duty-free access to the EU while phasing in reciprocal liberalization. Kenya is finalizing a detailed implementation strategy that emphasizes value addition...

and county-level participation. Implementation is progressing steadily, supported by EU business forums and technical workshops.

🚚UK–Kenya Continuity EPA:
This agreement, signed after Brexit, ensures continued duty-free access for Kenyan tea, flowers, and vegetables. It has provided stability for exporters who rely heavily on the UK as a key market.

Implementation is stable and progressing, reinforced by the 2025–2030 Kenya–UK Strategic Partnership.

🚚East African Community (EAC): As a founding member, Kenya benefits from duty-free regional trade within the EAC Customs Union and Common Market. However, frequent non-tariff barriers and political disputes limit full liberalization.

Implementation is progressing moderately, but bottlenecks reduce its effectiveness.

🚚COMESA: Kenya also belongs to COMESA, which provides wider regional access across 21 member states. Overlapping rules with the EAC often complicate compliance and reduce business uptake. Implementation is steady but constrained by bureaucracy and weak enforcement.

🚚African Continental Free Trade Area (AfCFTA):
Kenya ratified AfCFTA in 2018 and was part of the early pilot phase when it launched in 2022. The agreement has huge potential to expand Kenya’s markets across Africa,

but actual trade under AfCFTA remains limited. Implementation is progressing slowly, with institutions still being developed.

🚚Kenya–UAE Comprehensive Economic Partnership Agreement (CEPA): Signed in January 2025, the CEPA is the UAE’s first with a mainland African country, covering over 80% of goods trade.

It promises to deepen ties in investment, services, and sustainability while boosting Kenya’s role as a Gulf–Africa hub. Implementation is pending ratification but shows strong forward momentum.

🚚Kenya–China Trade Relations: Kenya has no formal free trade agreement with China, but the relationship is dominated by imports of machinery, electronics, and construction materials.

Exports to China remain small and mostly agricultural, leaving a large trade imbalance. Implementation is static, with ties driven more by investment projects than structured trade liberalization.

2. WHAT CHALLENGES DO SMALL ECONOMIES LIKE KENYA FACE IN ASSERTING THEIR TRADE SOVEREIGNTY?

🫩Dependence on Preferential Schemes: Kenya relies heavily on the US AGOA program which is set to expire in 2025, exposing it to job and export losses if not renewed.

Such dependence means Kenya has limited control over market access conditions.

🫩Structural Trade Deficits: Kenya’s trade with China is highly imbalanced, with massive imports of machinery and electronics against minimal agricultural exports.

This deficit limits Kenya’s leverage in negotiations and deepens dependency.

🫩Vulnerability to Conditionalities:
International trade deals such as the EU EPA often include sustainability, governance and labor standards clauses.

While beneficial in part, they impose compliance costs that small economies struggle to meet.

🫩Regional Integration Strains: In the East African Community (EAC), non-tariff barriers and conflicting national policies weaken Kenya’s ability to negotiate as part of a strong bloc.

Disunity reduces collective bargaining power.

🫩Weak Industrial Base: Kenya’s export basket is dominated by low-value goods like tea, coffee and cut flowers, making it difficult to demand fairer terms compared to economies exporting higher-value products.

This reliance reinforces its subordinate position in global trade.

🫩Debt and Investment Dependence: Large-scale borrowing for infrastructure projects has created debt vulnerabilities.

Such financial entanglements constrain Kenya’s ability to assert sovereignty in trade and investment decisions.

Ends!!