brexit

Brexit – new trade agreements between the UK and Kenya must be negotiated timeously

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The United Kingdom (UK) is one of Kenya’s biggest trading partners, with the UK being Kenya’s biggest export market for horticulture and tea; and also Kenya’s biggest source market for tourism.

The UK is the largest European foreign investor in Kenya. There are many British companies based in Kenya, including Vodafone, Barclays Bank, Diageo, Standard Chartered Bank, GlaxoSmithKline and Unilever. Therefore, the quick finalisation of new trade agreements that will be in effect after the UK has exited the European Union, will be
essential for Kenya. Kenya accounts for 27% of the fresh produce and 56% of the black tea market in the UK.
Kenya imports motor vehicles, printed materials, machinery and chemicals from the United Kingdom. If Brexit does happen, we will have to negotiate separately with the UK to finalise new trade agreements, as most of our trade agreements at present are with the EU.

If the new trade agreements are not in place by the time the UK leaves the EU, then Kenyan exporters will be subjected to higher tariffs and trade barriers. In addition, the country will lose its favourable trade status, which will adversely affect the export market and have a knock on effect on the economy. Shah notes that Kenya had been in a situation before when there was procrastination on the signing of a trade agreement with the EU for the horticulture sector. The agreement was eventually signed in 2014 but at the time, the Kenya Flower Council said that because of the delay in the signing of the trade agreement and the resultant higher trade tariffs, the Kenyan horticulture industry lost more than Kenyan Sh1 billion every month.

The UK will likely prioritise the negotiating of trade agreements with its key partners, namely the EU, the United States and China. When it comes to negotiating Kenya’s trade agreements with the UK, we are going to have to wait our turn in the queue. What we need ensure, however, is that we are as far in front of the queue as possible!

Paras Shah. partner
Bowman Gilfillan Africa Group’s Kenyan office.
Photo: foter.com

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July 4 (Monday), 2016 |

4 thoughts on “Brexit – new trade agreements between the UK and Kenya must be negotiated timeously

  1. John Benton says:

    Kenya should have no concerns over trading with the UK after Brexit. Kenya will be welcomed by the British, and will not be at the back of any queue when it comes to trade deals.

  2. kevin king says:

    Let’s hope the British get their arse in gear and sort it out as soon as possible. The issue for the UK government is, of course, that after 50 years reliance on the EU, they no longer have their own cadre of capable trade negotiators. Hard to believe they ever let this happen.

  3. Liam Fox, the Minister in charge of implimenting the Brexit move has already stated that Commonwealth Member States are going to receive accelerated negotiations in trade agreements. These negotiations will benefit not only the UK but all members of the Commonwealth, as it should be.
    I am firmly of the opinion that the UK is going to play a pivotal role in the further development of African Commonwealth States after the UK leaves the trading strictures imposed upon it by the EU. Both the UK and the African Commonwealth countries are going to bebefit enormously.

  4. William says:

    The significance of Kenya’s extraordinary agriculture and horticulture sectors must never be played down. Here in the UK Kenya not only provides us with black tea in vast quantities but also with vegetables when they are out of season here and, as I recently learned, huge quantities of flowers.

    It is of enormous credit to Kenyan businesses that they recognised a market and made themselves able to supply that market.

    Please be in no doubt, a free-trade deal between our countries will benefit both. The Kenyan suppliers will receive higher incomes because they will not have to discount their prices to take into account tariffs and we will be able to buy Kenyan products in our shops at slightly lower prices.

    Do not think you are low down the scale of priorities, you are not. Deals with numerous countries that provide us with quality produce can and will be made relatively quickly. They can only come into effect once we formally leave the EU, yet a free trade deal with the USA need not be in place and a trade deal with the EU need not be in place.

    Please have faith in the goodwill towards you of the people of the UK, we value what you provide and would love to have a trade deal that is to our mutual benefit.

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