Kenya, UK to resume talks on trade deal

British Prime Minister Boris Johnson and Kenyan President Uhuru Kenyatta have agreed to start negotiations for a post-Brexit trade agreement between the two nations. The talks are crucial as the current Economic Partnership Agreement (EPA) that Kenya has been relying on to export to the UK is set to expire in December. To shed light on the significance of these discussions, economic analyst Reginald Kazutu provided insightful details during a recent interview with CNBC Africa. Kazutu explained that as the UK continues negotiations with various countries post-Brexit, it is vital for Kenya to ensure an extension of duty-free and quota-free exports to the UK. Kenya and Britain have a longstanding history of trade relations, and if this agreement goes through, it could usher in a new era of bilateral trade. With the UK now outside of the EU, Kenya has an opportunity to negotiate terms that are more favorable to its interests. The focus will not just be on market access but on leveraging trade as a tool for economic growth and development. This new agreement is expected to benefit both parties by facilitating a more balanced trade relationship and gradual tariff liberalization. One key difference in this post-Brexit trade agreement is the potential for more liberalization in sectors such as services, consultancy, education, and technology. There could also be changes in immigration rules, allowing individuals with A-level qualifications from Kenya to apply for work permits in the UK. While this may lead to concerns about brain drain, it signifies a shift towards a more inclusive and reciprocal trade partnership. In terms of the current trade impact between Kenya and the UK, Kazutu highlighted that Kenya has been exporting goods worth billions to the UK, particularly in horticultural products such as flowers, fruits, and vegetables. However, the trade balance still leans towards imports, with Kenya bringing in industrial equipment and processed products from the UK. As the two nations move towards a bilateral trade agreement, the import-export gap may widen, posing challenges for Kenya's trade balance. Looking back at last year when Britain granted Kenya duty and quota-free market access, questions arise about the extension or renewal of this agreement, especially in light of the ongoing pandemic. Kazutu expressed confidence that the agreement will likely be extended to ensure continuity and stability in trade relations between the two countries, as the deadline for the current arrangement looms in December 2020. The upcoming negotiations between Kenya and the UK hold significant implications for both economies, shaping the future of their trade partnership post-Brexit. As discussions progress, it will be crucial for both parties to find a balance that promotes mutual growth and benefits while addressing the challenges posed by evolving global trade dynamics.