Trade Agreements Between South Africa And Kenya

The climate varies from the tropical regions of the South, West and Central to the dry and semi-dry regions in the north and northeast of the country. Temperatures range from temperate temperatures in the central Highlands, where the equator passes through the foothills of snow-capped Mount Kenya, to the warm tropics in deep, hot, humid areas throughout the year along the coast. In early 2013, Kenya and South Africa are expected to work on a preferential trade agreement that could remove administrative barriers and promote trade in goods and services between the two nations. In 2011, a joint trade committee was established to remove trade barriers. [4] Kenya is therefore on the verge of becoming the first violator of AfCFTA`s commitments before it can bear fruit. The AU has always recommended joint negotiations between African nations on issues of common African interest with third parties, such as trade and economic development. AGOA duty-free access is important to increase the competitiveness of the African apparel industry, which is not covered by the Generalized System of Preferences (GSP), another preferential trade program. Some of this competitive advantage was lost in 2005, when the World Trade Organization`s multifibre agreement ended, ending export quotas and strengthening competition between China and other Asian apparel producers (Figure 2). Nevertheless, duty-free access in sub-Saharan Africa has led to the development of the textile and clothing sector, which is a large employer of low-skilled workers. South Africa alone has a bilateral free trade agreement with SADC (Southern Africa Development Cooperation). There are also preferential agreements with Malawi, Zimbabwe and Croatia, as well as a non-reciprocal trade agreement with Mozambique. It is currently considering other bilateral agreements with Kenya, Nigeria, China, Japan, Singapore, South Korea and India.

At the end of 2011, it rejected a proposal for a free trade agreement put forward by Turkey, which would lead to destructive competition that would undermine South Africa`s industrial and employment objectives. The free trade agreement is also an important precursor to the post-AGOA relationship for the United States. AGOA was passed in May 2000 by the U.S. Congress during the Clinton administration and has since been extended until 2025. The agreement should never be permanent, but a springboard to a more mature trade relationship between the United States and the continent. However, the trade and investment landscape in Africa has changed since AGOA came into force and the last revival in 2015. For example, China`s growing economic influence in Africa and the conclusion of Mutual Economic Partnership Agreements (EPAs) between the EU and regional economic communities in Africa (RECs) have penalized US companies in Africa. These events probably put pressure on the U.S. Congress to protect U.S. companies interested in Africa.

Given that the renewal of AGOA is left to the discretion of Congress and that the extension of the current legislation is not guaranteed, the United States will probably demand similar concessions granted by Kenya to the EU in the EPAs. The goal is therefore to reach an agreement based on AGOA`s objectives and create a basis for the development of trade and investment between the United States and Africa. But Kenya`s unilateral decision to pursue a free trade agreement with the United States has drawn criticism from members of the East African Community (EAC) and the African Free Trade Association (AfCFTA). Both ABCEs and AfCFTA agreements discourage members from entering into bilateral trade agreements with third parties. Although Kenya has downplayed these concerns, the outcome of the negotiations will nevertheless have a significant impact on intra-African trade and Kenya`s influence across the continent. With the entry into force of the AfCFTA agreement in May 2019, the African landscape of trade integration has changed dramatically.