Summary
- Through the reciprocal trade deal, the US government is seeking unfettered entry for its companies into nearly all segments of Kenya’s economy including the heavily guarded ones.
- The pact will also protect whatever choice of technology that US investors opt to use in Kenya’s telecommunications sector, the wish list adds.
- The pact will also protect whatever choice of technology that US investors opt to use in Kenya’s telecommunications sector, the wish list adds.
Government officials are racing to finalise a free trade
agreement (FTA) that, if signed, is set to ease the entry of established
US companies into the local market.
Through the
reciprocal trade deal, the US government is seeking unfettered entry for
its companies into nearly all segments of Kenya’s economy including the
heavily guarded ones.
According to its wish list —
specific negotiation objectives — unveiled last week, two months after
it received go-ahead of Congress to pursue the talks, the US government
is pushing to have its agricultural products allowed into Kenya at zero
or reduced tariff.
It also hopes to ride on the FTA to
ease the entry of its telecommunication firms into Kenya in what signals
a shift in competition landscape for a segment currently dominated by
Safaricom
.
The Office of the US
Trade Representative (USTR) says it will make use of the envisaged FTA
to “promote the competitive supply of telecommunications services … and
secure commitments to provide reasonable network access for US
telecommunications suppliers”.
The pact will also protect whatever choice of technology that US
investors opt to use in Kenya’s telecommunications sector, the wish
list adds.
“Our vision is to conclude an agreement with
Kenya that can serve as a model for additional agreements in Africa,
leading to a network of agreements that contribute to Africa’s regional
integration objectives,” the USTR office states in the document
“We
seek to support higher-paying jobs in the United States and grow the US
economy by improving US opportunities for trade and investment with
Kenya.”
If the US has its way, its industrial goods
will enjoy duty-free market access, ending the free rein of Chinese and
Indian suppliers that currently dominate the segment. Last year, Kenya
imported Sh257.6 billion worth of industrial goods mainly from the Asian
markets.
Also facing tumult is the competition
landscape of the banking sector, which is currently dominated by about
five firms. The US says it will make use of the FTA to “expand
competitive market opportunities” for its financial service providers.
The
FTA, the US agency adds should “improve transparency and predictability
in Kenya’s financial services regulatory procedures … and ensure that
Kenya refrains from imposing measures that restrict cross-border data
flows or that require the use or installation of local computing
facilities”.
Firms that are either owned or controlled
by the State — which are free to favour local firms in their tendering —
may have to extend similar treatment to US companies.
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