Kenya’s Growth Under AGOA
Bilateral trade between Kenya and the U.S. is largely governed byAGOA. Kenya was among the first countries to qualify to export under AGOA in 2001 and since then, the exports, mainly textiles and apparels, have dominated the composition of trade to the United States. Apparel exports under AGOA have tripled from 2001 to 2006 and more than 190,000 Kenyans are gainfully employed as a result ofAGOA. Under AGOA, Kenya has increased employment, provided extra income for urban and rural workers, and boosted its economy. Yet, trade between Kenya and the U.S. has been in favor of the U.S.,as Kenya imports more from the American market than it exports.
Kenya - U.S. Trade Under AGOA
- Since AGOA, Kenya’s exports to the United States have increased from $41 million in 2001 to $326 million in 2007.
- While exports to the U.S. have increased, so too have imports from the United States. In 2006, Kenya exported approximately $353 million to theU.S. and imported approximately $516 million.
- Kenya’s exports to the U.S. are relatively lower-priced goods and commodities such as tea, textiles, apparels, pyrethrum, handcrafts, and processed nuts.
- Since the enactment of AGOA, textiles and apparels have dominated the composition of Kenya’s exports to the U.S. and constituted about 76 percent of the total exports in 2007.
- U.S. exports to Kenya have generally been manufactured high-value goods such as aircraft parts, machinery, electronic equipment, pharmaceuticals, organic chemicals, plastics, and fertilizers.
Key Kenya Challenges Regarding AGOA
The Kenyan private sector intends to use the upcoming AGOA forum to address key issues constraining Africa’s access to U.S. markets including:
- Attaining technical assistance to build local institutional capacities to ensure Kenyan producers comply with American animal and plant health standards.
- Addressing strict market requirements, inadequate financing for exporters, and the absence of assistance to identify trade opportunities.
- Ensuring sustainability of AGOA after the framework expires in 2015.
- Addressing AGOA linked bills such as the New Partnership for Development Act (NPDA) that erodes gains made from AGOA by extending duty free and quota free market access to least developed countries like Bangladesh and Cambodia.