By KIARIE NJOROGE
In Summary
Kenya will continue enjoying duty-free and quota-free
access for its goods to the European Union (EU) even if neighbouring
countries fail to approve the Economic Partnership Agreements (EPAs).
Josiah Rotich, the chief trade development officer at the
Trade ministry, said that Kenya will, however, not enjoy other benefits
that come with the EPA until all East African Community (EAC) partners
ratify the deal.
Among the benefits that will remain pending is the
rules of origin, a provision that allows Kenyan exporters to enjoy
duty- free access to the European market despite their goods being made
using raw materials sourced from other countries.
“On the basis of Kenya ratifying the agreement, the
country will continue benefiting from the duty-free, quota-free access
for as long as we are still trying to sort ourselves out at the EAC
level,” Mr Rotich said during a roundtable meeting organised by the
Institute of Economic Affairs (IEA).
“What Kenya is benefiting from the EU is market
access only. All the other things in the agreement like rules of origin,
the financial support, development component— we don’t benefit from
that because so far the agreement has not been ratified by everybody
else.”
Kenya and Rwanda signed the European trade deal in
September, but it needs approval from all members of the East African
Community bloc — which also includes Burundi, Tanzania and Uganda — to
take full effect.
Burundi and Uganda have indicated they are willing
to sign the deal, but Tanzania has declined to ratify it citing adverse
effects on its industrial ambitions.
It was feared that Kenya will lose the most without
the deal signed, as other member states would still continue getting
duty- and quota-free access under EU’s Everything But Arms initiative
since they are classified as Least Developed Countries.
The trade deal with the European Union gives EAC
member states duty- and quota-free access for their goods to the EU as
long as they meet the set health and safety standards.
EAC member states initialised an interim EPA deal
in 2007 and another in 2014. Governments were given two years from the
October 2014 agreement to ratify the deal in national parliaments.
Failure to ratify the deal would have seen Kenyan
face a Sh10 billion-a-year tax on exports to the EU market and put to
risk exports of more than Sh120 billion.
This would make its produce — mainly cut flowers,
tea, fresh vegetables and coffee — uncompetitive in the EU market,
putting at risk four million jobs.
The decision by Tanzania to pull out of the deal at
the last minute after 13 years of negotiations has put to question the
EAC’s willingness to work as a bloc.
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