• Kenya has began discussions to increase trade and counter challenges of a post BREXIT trade cooperation arrangement.
• With possibility of Brexit, Kenya fears to lose business with UK and EU.
Kenya is deliberating on how to increase trade and counter challenges of a post BREXIT trade cooperation arrangement.
Speaking at the Intra-Commonwealth trade summit for SMEs, Trade Cabinet Secretary Peter Munya said the cooperation will help small and medium enterprises grow their production to international standards.
“The discussion on growing Intra Commonwealth Trade on options for policy and regulatory cooperation is timely as it will tackle policy options for increasing trade and the advantages, possibilities and challenges of a post BREXIT trade cooperation arrangement,” Munya said.
In 2018, Kenya's exports to UK increased to Sh40.19 billion from Sh38.55 billion the previous year.
Exports to the EU also rose to Sh131.20 billion from Sh125.61 billion over the period.
Imports from the UK and EU increased to Sh31.55 billion and Sh219.60 billion respectively in 2018.
However, with the Brexit scenario, Kenya fears losing business with both partners where also the UK is expected to lose trade deals if it withdrawal from EU.
UK is part of close to 40 trade agreements which EU has with more than 70 countries.
Munya however said that trade between UK will continue.
Limited access to finance and beeing slow in incorporation of latest technologies have been highlighted as major challenges hindering the growth of SMEs and dragging the country from competing at the global market level.
Others include unawareness to international standards and quality assurance, and lack of research and innovation on new products.
The corporation formed by commonwealth secretariat composed of 53 countries is set to encourage and offer a platform for SMEs, exporters and importers to build awareness of existing global standards.
It is also set to encourage regional and international investments in areas where the commonwealth countries have competitiveness but lack capacity.
Munya announced to upgrade markets including the Kariokor common leather market with modern technology to increase production and raise standards for exports.
The market which is set to be fully operational next year, will enable clustering of common businesses including leather products, machinery and car parts paying a maintenance fee.
“The ministry only want to assist in upscale of standards and utilisation of clean working and safe amenities to increase out imports,” CS Munya said.
The market is set to operate as Uhuru market for textiles and timber dealers at Ngong road.
According to Commonwealth secretary general Patricia Scotland the corporation will focus on export development for goods and services, market access liberalisation and trade facilitation.
“Commonwealth will be providing trade-related assistance and innovation to Free Trade Area through funding to make transactions faster and increase efficiencies when trading with one another,” Scotland said.
According to Scotland, commonwealth countries enjoy 19 per cent in cost advantage when measured against comparable country pairs.
The intra-Commonwealth trade and investment is set to increase to Sh202.6 trillion ($2 trillion) by 2030.
In 2017, trade in goods and services was estimated at Sh56.7 trillion ($560 billion).