The European Union now says the fate of Kenya’s imports to the European trade bloc is in the hands of the East African Community trading bloc amid rising anxiety over the future of Kenya’s multibillion shilling.

EU’s Trade and Communications counsellor Christophe De Vroey in Kenya told East African Business Week in Nairobi the five member EAC bloc could cushion Kenyan exporters by fast-tracking deliberations of the contentious issues which stand in the way of the signing of the much elusive Economic Partnership Agreement (EPA) between EAC and its European counterpart.

“If the negotiations are complete and we have a deal by the end of October this year, then Kenya could in three or four months resume to its preferential status exempting its goods from taxes,” Vroey said in Nairobi.

“The fate of Kenyan exporters depends on the sooner we conclude these negotiations but we (the European Union) are more than ever before committed to a deal. We are ready to do this as soon as possible,” Vroey said

Kenya became the only African country to lose out on the duty and quota-free market access to the 28-member EU, beginning October 1 following the deadlock over the contentious EPA negotiations.

This is because the rest of the EAC countries – Tanzania, Uganda, Rwanda and Burundi – are cushioned through Everything-But-Arms trade agreement for least developed countries.

Kenyan exporters from last week therefore began incurring surcharges estimated to amount Ksh 100 million ($1 million) a week following failure by East Africa to broker the trade deal that would have allowed continued free access to the European Union market.

Fresh roses and cut flowers, for instance, are attracting import duty of between 8.5 per cent and 12% under the normal EU tariff and between 5 and 8.5 per cent under GSP.

Consequently, Kenyan products, mainly flowers and fresh vegetables, have become more expensive than those of their competitors like Tanzania and Ethiopia.

Kenya exports flowers to the EU worth Ksh46.3 billion and vegetables worth more than Ksh26.5 billion annually. T

The EU takes about 75% of Kenya’s fresh produce exports.

Other African countries exporting to the EU are safe from higher taxation regime after their respective trading blocs, the Economic Community of West African States, (Ecowas) and Southern African Development Community, (Sadc) both signed EPA pacts with EU last July.

Failure by the EAC to conclude the trade pact in time for ratification before the September 30 deadline has effectively exposed Kenyan produce to a higher tax bracket under the Generalised System of Preference.

Vroey said five outstanding issues stand in the way of the success of the agreement.