Exports to Pakistan decline as Japan, UAE increase imports to Kenya

In Summary

• Uganda was Kenya's top export market, purchasing goods worth Sh10.71 billion.

• The gap between imports and exports for the first two months of 2019 widened by 3.46 per cent to Sh192.17 billion

A worker picks tea at a plantation
A worker picks tea at a plantation
Image: FILE

Kenya’s trade market went through a shake-up in the first two months of the year with Pakistan losing its position as the country’s top export market while Japan grew to become Kenya’s second largest import market.

While Pakistan is the top buyer of Kenyan tea, Data by the Central Bank of Kenya show the value of exports to the world’s sixth most populous country registered the largest drop of 38.94 per cent to Sh8.75 billion compared to the same period last year.

This ranked the Asian country Kenya’s third largest exporter after Uganda at Sh10.71 billion and Netherlands at Sh9.6 billion. The UK and US came in fourth and fifth place at Sh8.14 billion and sh7.91 billion respectively.

The data shows the value of export receipts for the two months dropped 5.88 per cent to Sh104.21 billion largely driven by a decline in earnings from tea.

During the period 45.35 per cent of goods sold abroad were food and beverages while consumer goods and industrial supplies accounted for 27.12 and 24.69 per cent of exports.

On the other hand, the value of imports grew marginally by 3.46 per cent to Sh296.38 billion showing increased appetite for foreign goods.

A report by United States Department of Agriculture Service shows Kenya's food imports of corn, wheat, and rice are expected to increase in the coming financial year due to a widening local supply deficit. 

“Corn and wheat production are both expected to dip on account of the reduced planted area while rice production is projected to stagnate, due to delays in anticipated rehabilitation and expansion of the irrigation infrastructure,” the report stated.

 Japan was the biggest gainer during the review period, more than doubling its earnings from imports to Kenya to Sh29.64 billion compared to Sh14.53 billion over the same period last year.

Japan is most recognised for its used car imports to Kenya. This is because the Asian country has strict vehicle inspections forcing cars out of circulation after just a few years.

The data shows Japan overtook India to be Kenya’s second largest import market after China.

The value of imports from Saudi Arabia and India decreased by 33.36 per cent and 28.61 per cent to Sh19.7 billion and Sh26.27 billion respectively.

The UAE registered a 60.29 per cent increase in the value of goods purchased from Kenya to Sh24.59 billion.

The gap between imports and exports for the first two months of 2019 widened by 3.46 per cent to Sh192.17 billion, data by the Central Bank showed.

In the 12 months to December, Kenya’s trade deficit grew to Sh1.145 trillion from Sh1.13 trillion over the same period in 2017.