Workers picking tea. FILE PHOTO | NMG
Summary
- Some Sh120 million owed to local traders is stuck in the country and the situation may get worse after the six-month US window for firms trading in America to stop doing business with Iran closes.
- President Donald Trump on Tuesday withdrew the US from the nuclear deal, just three years after sanctions were lifted following an agreement between Tehran and five western powers.
- The move, Agriculture and Food Authority (AFA) says, will hit traders who export tea to the country as they will experience difficulties getting payments as no bank will be willing to transact business with Iran.
Tea exports to Iran will most likely be hit by the fresh
sanctions after US withdraw from a nuclear deal, coming just months
after the Kenya led a marketing campaign to Tehran.
Some
Sh120 million owed to local traders is stuck in the country and the
situation may get worse after the six-month US window for firms trading
in America to stop doing business with Iran closes.
President
Donald Trump on Tuesday withdrew the US from the nuclear deal, just
three years after sanctions were lifted following an agreement between
Tehran and five western powers.
The move, Agriculture
and Food Authority (AFA) says, will hit traders who export tea to the
country as they will experience difficulties getting payments as no bank
will be willing to transact business with Iran.
“We may not be able to export tea to that market because of the
sanction. However, we are watching the market with caution,” said AFA
director- general Alfred Busolo.
The regulator,
however, says payments made in euro are unlikely to be affected as
European Union (EU) countries are not likely to follow suit.
“Payments
for tea sold to Iranian companies will be difficult as the dollar is
the dominant currency of trade. However, we note trade in the euro may
not be directly affected as EU countries may not go the same way as the
US,” he said.
The lifting of the ban in 2016 allowed Kenyan banks to transact with Tehran and repatriate cash.
The
local banks were allowed to transact business with Iranian lenders to
facilitate payment, especially for tea traders. As of October last year,
Iranian buyers owed local exporters the Sh120 million.
The
International Atomic Energy Agency, which is the UN nuclear watchdog,
in 2016 certified Iran as compliant with the July 2015 agreement on
limiting nuclear development.
Kenya has been targeting
Iran as one of the major buyers of its beverage and has since the
lifting of the sanctions actively marketed its tea. In October last
year, officials from the Tea Directorate visited the country in a
marketing drive.
Iran normally gets the bulk of its
tea from India and Sri-Lanka with Kenya supplying about 20 million
kilogrammes of the 120 million kilos the besieged country imports
annually.
No comments :
Post a Comment