Trade Data Analysis

Kenya: Intra-Africa trade and tariff profile

Kenya: Intra-Africa trade and tariff profile

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This trade update provides a country analysis of Kenya’s trade relations with Africa, including tariff analysis. All data is sourced from the United Nations (UN) International Trade Centre (ITC) TradeMap and Market Access Map (MacMap) databases. We use the most recent data available from these databases and we are cognizant of the challenges to access of reliable and quality data. Therefore, this analysis at best provides an indicative picture of Kenya’s Africa trade profile.

Regional Economic Communities

Kenya is party to several regional economic communities (RECs) in Africa. These include the Community of Sahel-Saharan States (CEN-SAD); the Common Market for East and Southern Africa (COMESA); the East African Community (EAC) and the Inter-governmental IGAD.

CEN-SAD currently has 24 member states. The ambition is to establish an Economic Union (which includes the free movement of goods and services). CEN-SAD was revived in 2013 with a revision of the CEN-SAD Treaty. The revised Treaty focuses on cooperation activities to foster peace, security and sustainable development and measures to adapt to climate change but has not yet entered into force, there is still no free trade agreement in place.

COMESA has 19 member states (including Eritrea, Ethiopia, Egypt, Eswatini, Malawi and Djibouti) of which 16 are part of the COMESA FTA. Eswatini has preferential access under a derogation but is exempt from reciprocating preferences due to its membership of SACU. The DRC, Eritrea and Ethiopia are in the process of joining the FTA.

The EAC is a customs union (Burundi, Rwanda, South Sudan, Kenya, Uganda and Tanzania) with duty-free intra-EAC trade and a common external tariff (CET). The member states also adopted a Common Market Protocol in 2009, which came into effect in 2010. However, the Protocol has not yet been fully implemented.

Djibouti, Eritrea, Ethiopia, Kenya, Somalia, South Sudan, Sudan and Uganda are the IGAD member states. No intra-IGAD tariff liberalisation has taken place.

Intra-Africa trade

Kenya’s trade with Africa is relatively diversified for both exports and imports. In 2017, intra-Africa exports and imports were each valued at about US$1.9 billion.

The bulk of exports were destined to the COMESA and EAC regions, with EAC members Uganda (31%) and Tanzania (14%) accounting for about 45% of Kenya’s exports. Other EAC members Burundi (4%) and Rwanda (9%) accounted for an additional 11% share. Top 10 export destinations accounted for 93% of Kenya’s total intra-Africa exports. Other top 10 destinations were from COMESA; and IGAD and include Somalia; Egypt; DRC; Ethiopia; Zambia and Malawi.

In terms of import sources, South Africa which does not have any preferential arrangement with Kenya accounted for 31% of Kenya’s imports in 2017. South Africa and Mozambique (1%) were the only non-REC countries in Kenya’s top 10 import sources. Uganda and Tanzania were Kenya’s top suppliers from the EAC, while the rest of Kenya’s top 10 intra-Africa import sources were from COMESA.

Top export products included Tea; Petroleum oils; Medicaments; Manufactured tobacco products and Products of iron and non-alloy steel, among others. Top 10 products accounted for 44% of Kenya’s total intra-Africa exports. Top imports on the other hand included Sugar; Maize; Products of iron and non-alloy steel; and Dried Legumes among others. Kenya’s top 10 intra-Africa imports accounted for 48% of Kenya’s total intra-Africa imports.

Intra-Africa tariff analysis

Kenya is party to 4 RECs in Africa, however, as highlighted above, the CEN-SAD and IGAD preferential arrangements are not yet in force. Therefore, countries that are members of COMESA and the EAC enjoy preferential access into Kenya. COMESA currently is a free trade area (FTA) while the EAC is a fully-fledged customs union. COMESA intends to become a fully-fledged customs union; however, Kenya will not be party to it given that it already belongs to the EAC.

Non-REC members which include Algeria, Angola, Cabo Verde, Congo, Gabon, Mauritania, Mozambique and the Southern Africa Customs Union (SACU) members – South Africa; Botswana; Namibia and Lesotho – do not enjoy preferential access. This means that products originating from these countries attract the CET tariff rates which are categorised into 5 tariff bands – from duty free to maximum applied rates of 60%, although in certain instances Kenya can levy a tariff of up to 100% on refined sugar to protect its domestic market.

With the exclusion of CEN-SAD, COMESA, EAC and IGAD, Kenya’s total intra-Africa imports were valued at US$632 million in 2017 which is equivalent to 32% of Kenya’s total intra-Africa imports. Of all products imported, the average tariff rate was about 8%. Main products included Products of iron or non-alloy steel; Maize or corn; Coal or briquettes; Passenger vehicles among others. Top 10 imports from these countries accounted for almost 60% of Kenya’s non-REC intra-Africa imports in 2017.

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Kenya: Intra-Africa trade and tariff profile | July 2018
Infographic: Kenya – Intra-Africa trade and tariff profile | July 2018
Kenya: Intra-Africa trade data spreadsheet | July 2018

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