With an impending deadline of October 1st 2014 to sign the East Africa Community and EU partnership agreement, there is mounting concern that Kenya might lose its market share to other flower producing countries such as Ethiopia, Ecuador, Columbia among other.
A report by the Kenya Flower Council indicated that the anxiety has driven players in the country’s flower industry to urge the government to conclude the negotiations with EU so that flower trade is not disrupted. If a deal is not reached, then Kenyan exports to the EU will attract import duty varying between 5-20%. This will have adverse impact on Kenya’s competitiveness forcing the growers to change their current business model so that they can absorb the new taxes.
Acknowledging the importance of the EAC EU EPA negotiations for Kenya’s exports to the European Union, Kenya’s President Uhuru Kenyatta committed to take charge of the negotiations for timely conclusion. This comes after a meeting for the joint EAC – EU Ministerial meeting was held late January this year in Brussels, Belgium failed to conclude just about 1-2% outstanding issues. The Ministers, preceded by technical teams and senior officials, will meet again this month in East Africa.
If the agreement is not signed by the October 1st deadline, Kenya will not be able to compete on price and market share will be lost which will have an adverse effect on investments and jobs.