EXPANSION

Boost for Kenya–US trade in new air freight deal

The countries have revised their 2008 bilateral air services agreement,facilitating the expansion of air freight services.

In Summary

•It is expected to boots trade after a slight drop on imports from the US in 2018, whose value dropped 7.2 per cent to Sh53.2 billion in 2018 , down from Sh57.4 billion a year earlier.


•Kenya Airways cargo stands among the biggest beneficiaries having commenced direct flights between JKIA and JF Kennedy International Airport in 2018.

EXPANDING: A Kenya Airways cargo plane/
EXPANDING: A Kenya Airways cargo plane/
Image: FILE

Trade between Kenya and the US is set to benefit from a new aviation deal that grants direct cargo flights.

The countries have revised their bilateral air services agreement, facilitating the expansion of air freight services.

The new move strengthens the already existing passenger traffic rights that allows national carrier Kenya Airways direct flights between Nairobi and New York.

 
 

The new deal, which revises the initial agreement signed in Washington on June 18, 2008, was signed by Transport CS James Macharia and US assistant Secretary of State for Economic and Business Affairs Manisha Singh.

This was done on the sidelines of President Uhuru Kenyatta's visit to the US this week.

“The revised bilateral air services agreement between Kenya and the USA will facilitate the expansion of air freight services, by allowing airlines from both countries to set up and operate air cargo hubs in either country,” CS Macharia wrote on Twitter.

The rights in the amendment facilitate the movement of goods throughout the world by providing air carriers greater flexibility to meet their cargo and express delivery customers’ needs more efficiently, the US government notes.

Specifically, the amendment allows U.S all-cargo airlines to fly between Kenya and a third nation without needing to stop in the United States, an important right if operating a cargo hub.

“ Kenyan all-cargo carriers have reciprocal rights to serve the United States.  This amendment further expands our strong economic and commercial partnership, while creating new opportunities for all-cargo airlines, exporters, and consumers,” the US government said.

It will fully open the Kenyan air cargo services market to U.S carriers, and represents one way in which the U.S government is delivering for US all-cargo carriers and American workers, the Trump administration has affirmed.

 
 

National carrier-KQ, as it is know by its international code, stands among the biggest beneficiaries, having commenced direct flights between JKIA and JF Kennedy International Airport in 2018.

Its maiden flight to the US touched down in New York on Monday October 29, with the new route giving the loss making carrier hopes after years of losses.

The deal gives KQ an opportunity to operate a freighter on the route, which it has been feeding with small volumes carried on the bellies of the passenger planes.

This will boost cargo volumes between the two countries.

Kenya Investment Authority (KenInvest) has since welcomed the deal saying it will boots trade and investments between the two countries, even as the US remains among the top three sources for the country's Foreign Direct Investments.

“Our trade relations is increasing and with expanded air freight services, it will enhance more investments,” KenInvest managing director Moses Ikiara told the Star on telephone.

It is expected to boost trade after a slight drop on imports from the US in 2018, whose value dropped 7.2 per cent to Sh53.2 billion, down from Sh57.4 billion a year earlier.

Kenyans export earnings however slightly increased to Sh47.3 billion up from Sh47.2 billion in 2017, the Economic Survey 2019 shows, mainly on apparel and clothing accessories.