African countries want a key trade deal that gives them expanded duty free access to the US market extended by ten years.
Kenya is one of the biggest beneficiaries of the African Growth and Opportunity Act (AGOA) wth the US.
During a ministerial engagement in Washington DC, on the sideline of the US-Africa leaders summit, ministers from the continent said the Act should be extended to 2035.
The AGOA treaty was initially intended to last 15 years from the year 2000. It was however extended for 10 years to September 2025.
The deal allows sub-Saharan African countries to export thousands of products to the US under preferential terms that eliminates tariffs.
According to the ministers, AGOA is the cornerstone for US-Africa bilateral trade relations, and vital to the development of regional, continental, global value chains, the African Union economic arm said.
The move, they say will also allow the continent align it's trade and investment with the US under the African Continental Free Trade Area (AfCFTA).
The extension sought however comes on the back of arguments that AGOA has failed to achieve an increase in the quantity and quality of exports to the US market, despite two decades in operation.
Kenya is among the biggest beneficiaries of the AGOA program which gives the country and 40 other sub-Saharan African countries duty-free access to the US market for over 7,000 products.
"Kenya is the largest exporter of garments under the AGOA program. We pride ourselves on manufacturing for big names such as H&M, Levi’s, JC Penny, Wrangler, and Otto, among others" Kenya Association of Manufacturers (KAM) chief executive Anthony Mwangi notes.
This, he says, demonstrates that local industries can produce high-quality products for local and international markets. More than 70 percent of Kenya's exports to the US are duty-free under AGOA.
Last year, Kenya's exports to the US grew to Sh59.5 billion, up from Sh49.3 billion previous year, with increases in the exports of macadamia nuts and articles of apparel and clothing accessories.
The US is the largest export destination of Kenya’s apparel, accounting for over 90 percent of garment exports every year.
The country has been pushing for a separate trade deal with the US to secure preferential terms before the lapsing of AGOA.
With a bilateral deal, Kenya is keen to tap at least five per cent of the US market, which has the potential to earn the country more than Sh2 trillion in export revenues annually.
On Tuesday, Investments, Trade and Industry Cabinet Secretary Moses Kuria had the first in-person meeting with US trade representative Katherine Tai and deputy Ambassador Sarah Bianchi to revive talks that had stalled due to the Kenya's August elections.
Expanding bilateral trade, inclusion of women and youth and supporting Micro, Small and Medium Enterprises will form the initial stages of the resumed talks under the Ruto administration.
