NAIROBI – Kenya and the EU on Monday signed an Economic Partnership Agreement (EPA) to boost bilateral trade in goods, increase investment flows, and contribute to sustainable economic growth.
Following the signing at State House- Nairobi witnessed by President William Ruto and EU Commission President Ursula von der Leyen, the EPA will be transmitted to the European Parliament for consent. The agreement will subsequently enter into force.
EU in a statement soon after the signing said the deal provides a platform to support job creation on both sides, along with targeted cooperation to enhance Kenya’s economic development.
“It is the most ambitious trade deal ever signed by the EU with a developing country when it comes to sustainability provisions such as climate and environmental protection, labour rights and gender equality,” EU said.
President Ruto said the deal — the first with a developing country in which the EU’s new approach to trade and sustainable development is reflected — will further spur the EU investment to Kenya besides guaranteeing higher earnings for our products.
On her part, Ursula said Kenya is a key partner for the European Union in Africa and the new EPA will boost bilateral trade even further, support investments and create good jobs in Kenya.
“This agreement will also contribute to sustainable and fair economic growth, bringing new opportunities for companies, to the benefit of both our people. It includes the strongest social and climate commitments of any EU trade deal with an African country,” she said.
The EU is Kenya’s first export destination and second largest trading partner, with a total of €3.3 billion in bilateral trade in 2022 – an increase of 27% compared to 2018.
The EPA, the EU said willeven more opportunities for Kenyan businesses and exporters, as it will fully open the EU market for Kenyan products upon entry into force. It will also incentivise EU investment in Kenya thanks to increased legal certainty and stability.
Trade Principal Secretary Dr Alfred K’Ombudo, who has been leading negotiations on the Kenyan side, termed the deal as a bold statement of partnership between the EU and Kenya.
“In addition to unlocking several opportunities for trade, it further advances the now—established concept of sustainable trade and investment,” he said.
The Economic Partnership Agreement between the EU and Kenya aims to implement the provisions contained in the EU-East African Community (EAC) EPA, and will be open for other EAC countries to join in the future.
Other EAC bolted out at the 21st Ordinary Summit in February 2021, when it was noted that not all partner states were in a position to sign, ratify and implement the EPA agreement but recognised the importance of some partner states to move forward.
Kenya and Rwanda had signed the deal but it could not be operationalised without all the EAC members’ signatures and so Kenya sought a framework to proceed bilaterally.
The EPA was a sticky issue during the 20th Heads of State Summit in Arusha on February 1, 2019, with Tanzania insisting that it must be allowed more time to send experts to EU headquarters in Brussels to present its grievances.
Tanzania, for instance, argued that the agreement would have serious consequences on its revenues and the growth of its industries.
“The EPA and its ambitious commitments represent a crucial deliverable of the current EU Trade Agenda, in particular the goal of enhancing trade relations with Africa, helping the EU to deepen and expand its current trade agreements with African countries, and enhancing their sustainability objectives,” EU said.