Kenya nears tariff-free agricultural exports deal with China

Kenya,a nation heavily reliant on agricultural exports,seeks to expand its commercial opportunities globally. The country now steps closer to a bilateral agreement with China that would scrap customs duties on several key agricultural exports,including tea,coffee,and avocados. President William Ruto announced this progress during a presidential round table with the private sector in Nairobi earlier this Week,reported Ecofin Agency,citing the local Business Daily.

“We have concluded the high-level conversation with China. They have agreed to a reciprocal arrangement to remove all the tariffs on our tea,avocado and other agricultural exports,” President Ruto said,adding that what remains is finalizing the bilateral instruments before the deal comes into effect “in a few months.”

This potential deal represents a strategic move in Kenya’s trade diversification policy. It will allow Kenya to compete more effectively in China’s agricultural market,where Kenyan products currently face tariffs around 10%.

Tea production,a key sector with major ambitions for China,stands to benefit greatly. The Kenyan government announced in May its goal to quadruple tea exports to China by 2030. This agreement could accelerate that vision.

The timing of this development is critical. On August 3,the United States imposed a 10% tariff on Kenyan products as part of reciprocal trade measures. Previously,Kenya enjoyed duty-free exports of arabica coffee,black tea,macadamia nuts,and vegetable oils to the U.S. market under the African Growth and Opportunity Act (AGOA),whose benefits are now withdrawn.

Given these challenges,securing tariff-free access to China’s market can help Nairobi offset losses in the U.S. trade arena. Pointing to China’s vast population of 1.4 billion,Trade and Industry Minister Lee Kinyanjui explained that selling tea and coffee to just 1% of its consumers would be a life-changing development for Kenyan producers.