Politics and policy
Amina Mohamed, the Cabinet Secretary for Foreign Affairs and
International Trade, during a meeting with her Iran counterpart,
Mohammad Javad Zarif, in Tehran on August 21, 2014. PHOTO | MINISTRY OF
FOREIGN AFFAIRS
By George Omondi
In Summary
Tea exporters are banking on the fresh talks between
Kenya and Iran to ease exchange control that delay payment for their
shipments and hinder repatriation of profits.
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Foreign affairs Secretary Amina Mohamed is in Tehran to,
among other things, “explore ways of addressing challenges faced by
Kenyan tea exporters especially with regard to the repatriation of
profits.”
At a meeting with Iranian foreign Minister Mohammad
Javad Zarif on Tuesday, Ms Mohamed cited “rigorous” inspection and
certification among the difficulties that tea exporters face in
transferring proceeds from sales to Kenya.
“I, therefore, appeal through you to the relevant
authorities to ease the difficulties being encountered by exporters, by
streamlining financial intermediation and the certification processes,”
Ms Mohamed said in a statement
Kenya’s Sh100 billion-a-year export tea industry
get the bulk of its earnings from Egypt, Pakistan, Afghanistan, Iran,
Yemen, and Sudan.
Strict control on foreign exchange accounts by
governments of Iran, Yemen and Sudan has particularly had negative
impact on tea export, say traders.
Tea exporters say their cash flows have suffered as
a number of customers take advantage of slow clearance of
dollar-denominated payments in the Islamic states to delay releasing
cash by up to six months.
“As long as the currency of trade remains the US
dollar, only the bilateral negotiations can remedy the situation,” Mr
Peter Kimanga, director at the Mombasa-based Global Tea &
Commodities, said.
“At the moment, it is difficult to tell between a
good customer and a bad one because they all blame slow process of
clearing payment for delays that extend to six months.”
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