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July 15, 2022

US, Kenya strike trade partnership ahead of AGOA expiration date

The new US-Kenya Strategic Trade and Investment Partnership is being described as "a model for trade policy engagement in Africa" ahead of the scheduled expiration of the African Growth and Opportunity Act (AGOA) in 2025.

By Laura Husband

In a statement introducing the new US-Kenya trade partnership, United States Trade Representative (USTR) Katherine Tai said: “We hope this initiative can serve as a model for trade policy engagement in Africa, one of the most dynamic and fastest-growing regions in the world.”

The partnership, which was announced yesterday (14 July), is launching three years ahead of the scheduled expiration of AGOA.

Last month, the American Apparel and Footwear Association (AAFA) urged Tai to renew AGOA for at least another ten years, noting as companies are poised to diversify out of China, Africa is a logical place for many of them.

The new partnership abandons the bilateral free trade agreement negotiations the two sides initiated several years ago in favour of an effort similar to those the US is pursuing with the Indo-Pacific and Latin American regions, international trade law firm Sandler Travis & Rosenberg (ST&R) says.

“While the US has given no indication of other partners on the continent that might be ready to follow in Kenya’s footsteps, the scheduled expiration of the African Growth and Opportunity Act in 2025 could accelerate that process,” ST&R says in a trade report.

Announcing the lanch, Tai said the US-Kenya relationship is critical to addressing key regional and global challenges, noting the initiative represents an opportunity to work together on shared priorities including labour, environment, digital trade, trade facilitation, and good regulatory practices.

“I look forward to working with the Kenyan government over the next few months to build out this partnership and grow our trade and investment relationship in a way that promotes resilience and facilitates sustainable and inclusive economic growth that benefits our workers and our planet.  We also hope that this initiative can serve as a model for trade policy engagement in Africa, one of the most dynamic and fastest-growing regions in the world.”
 
Representatives from both the US and Kenya agreed their governments will pursue enhanced engagement leading to high standard commitments in a wide range of areas. The aim is to:

  • Increase investment
  • Promote sustainable and inclusive economic growth
  • Benefit workers, consumers, and businesses (including micro-, small-, and medium-sized enterprises)
  • Support African regional economic integration.  

The initial issues that were identified as areas where the United States and Kenya could develop an ambitious roadmap for enhanced cooperation to achieve economically meaningful outcomes are:

  • Agriculture
  • Anti-corruption
  • Digital trade
  • Environment and climate change action
  • Good regulatory practices
  • Micro, small and medium enterprises (MSMEs)
  • Promoting workers’ rights and protections.  
  • Supporting participation of women, youth, and others in trade
  • Standards collaboration

The US and Kenyan governments will commence working within three months to develop a detailed roadmap for engagement in each of the listed areas. 

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