- Total UK exports to Kenya amounted to £635 million in the four quarters to the end of Q3 2023.
- On the other hand, total UK imports from Kenya amounted to £771 million in the same period.
Image: FILE
Flower farmers in the country are set to earn more from exports to the UK following the suspension of the eight per cent duty fee on fresh cut flowers.
The UK government on Monday made the announcement to suspend the fee from April 11 to June 2026, with a review on possible extension before this date.
This means any flowers transiting through auctions in the Netherlands will now not incur the duty, as previously was the case.
Agriculture Sector Network (ASNET) in a statement welcomed the move saying the measure will help Kenyan growers and exporters.
"This could lead to new jobs and economic growth in the flower trade," Asnet said.
Kenya's earnings from cut flowers dropped to a five-year low in 2023.
A report by the Fresh Produce Consortium of Kenya (FPCK) shows the country exported 116,000 tonnes of cut flowers worth Sh73 billion in 2023 compared to 203,000 tonnes worth Sh104 billion in 2022.
This was the least cut flower export volume the country recorded since 2017 when it shipped 160,000 tonnes worth Sh82 billion to the international market.
However with the duty suspension players are optimistic that the earnings will pick up.
The UK government had invited applications for duty suspensions between June 12 and August 6, 2023 where a total of 245 applications were received.
Out of these, the ones that merited consideration had to entail products not traded between persons who are related parties in circumstances, which would not enable other United Kingdom businesses to benefit from the suspension.
The products seeking duty suspension were also not to be in sufficient quantities in the UK.
The UK government also took into account international arrangements, to which the UK is a party, for example free trade agreements with other countries.
Kenya signed an economic partnership agreement with the UK on August 8, 2020 in London.
The agreement ratified in March 2021, seeks to ensure all companies operating in Kenya, including British businesses benefit from duty-free access to the UK market.
This was to save exporters over £10 million (Sh1.7 billion) every year in duties on products such as green beans and cut flowers.
Generally, the agreement commits the UK to support Kenya with agreement implementation, enhance competitiveness, build trade capabilities and ability to attract investment, as well as further integrate itself into global supply chains.
Kenya through the agreement was also to gradually reduce duties on UK products they have deemed non-sensitive, providing Kenyan businesses with cheaper inputs, which could support agricultural development and manufacturing.
Data by Kenya-UK factsheet on trade and investment shows total trade in goods and services between the tow sates stands at £1.4 billion (Sh236.7 billion) in the four quarters to the end of Q3 2023.
This is an increase of 11.1 per cent or £140 million (Sh23.7 billion) in current prices from the four quarters to the end of Q3 2022.
Of this, the total UK exports to Kenya amounted to £635 million in the four quarters to the end of Q3 2023 (an increase of 6.5% or £39 million in current prices, compared to the four quarters to the end of Q3 2022).
On the other hand, total UK imports from Kenya amounted to £771 million in the same period (an increase of 15.1 per cent or £101 million in current prices.
Kenya was UK’s 81st largest trading partner in the four quarters to the end of Q3 2023, accounting for 0.1 per cent of total UK trade.
"In 2021, the outward stock of foreign direct investment (FDI) from the UK in Kenya was £489 million whereas the inward stock of foreign direct investment (FDI) in the UK from Kenya are not available."