East African Community (EAC) member states have up to five years to join the UK-Kenya trade agreement due to be signed ahead of the Brexit transitional deadline. The new document has also shielded budgetary cuts that had been imposed on Trade Mark East Africa’s (TMEA) work in Kenya, allowing continued regional trade facilitation by the organization.
However, budgets for Rwanda and Ethiopia were cut by 15%, lower than the initial 29% announced earlier in the year.
What this means is that while Kenya negotiated solely, other East African countries could ride on the deal for the next few years as they figure out whether to enter, based on “transitional clauses.”
These transitional clauses will allow other EAC member states to utilize what Kenya had agreed on with the UK and discuss variable new issues such as services trade, new technology, and research and innovation, which were lacking under the European Union Economic Partnership Agreements (EPAs).
The deal to seeks to save Kenya’s exports from facing taxation in the UK market once the transitional clauses under the EU expire. Under the arrangement, the UK accepted products produced in the EAC, other than Kenya, to be exported into the UK duty-free quota-free, provided there is proof they originated from the region.
The deal will benefit Kenyan products such as tea, coffee, vegetables, and flowers, while the UK will have free access to export vehicles, pharmaceuticals, and paper worth almost $1 billion.