Kenya hopeful of signing EPA Agreement by July this year

The CEO of Kenya Flower Council KFC), Mrs Jane Ngige has confirmed that Kenya has covered significant ground in the on-going negotiations on the EAC-EU Economic Partnership Agreement (EPA) and hopes that the deal will be signed by July this year.

The Chief Executive noted that the pending issues going forward are not very major, and that these would soon be resolved. Ms Ngige added that signing of the EPA pact would play significantly in enabling Kenya compete more ably with her regional peers. Kenya is the only country in the East African Community trading block that is classified as a developing country. The others (Uganda, Tanzania, Rwanda and Burundi) are categorized as Least Developed Countries (LDCs) which puts them in a better trading position compared to Kenya. The LDC countries are not required to sign the EPAs since their preferences will continue under the Everything But Arms (EBA) scheme. Under EBA, poor nations are granted duty free access to the EU for all products, except arms and ammunition and 41 tariff lines concerning rice and sugar, on which duty free quotas are established until full liberalization.

But as a developing country, Mrs. Ngige says, failure to sign the pact will put Kenya in an awkward position as the country needs to continue accessing the European market.

Should Kenya miss out on signing the EPAs, trade between it and Europe would be reverted to the less generous market access terms under the General System of Preference (GSP).The European Union (EU) is however optimistic that they will get an economic partnership agreement in place with the East Africa community member states before the October 1 deadline. The talks have been going on for more than a decade, and if they continue to drag on, the county’s flower industry could begin to suffer even more losses.

In 2013, Kenya’s flower industry earned the country 46 billion Kenyan shillings, (approximately 340 million euros) a figure that was three billion Kenyan shillings more than 2012.

The EAC Partner States have negotiated for policy flexibility for revision of the tariff lines liberalized under the EPA. Further, the EAC and the EU have agreed to review the Agreement after every 5 years. The EPA contains provisions on trade defence instruments that would give EAC the opportunity to impose measures in cases where EU imports were to increase in such quantities that they would threaten domestic producers and industry.