With the entry into force of the Free Trade Area (FTA), Kenya expects an increase in foreign direct investment from the USA. This emerges from a report by the American Chamber of Commerce which analyzed the potential benefits and challenges of the US-sponsored free trade agreement.
Both US and Kenyan business representatives believe that Kenya could attract more investment due to its geographic location as a gateway to the East African market. “US business representatives agreed on their expectations and their desire to gain access to the local market,” the report said in part. Talks on a free trade area began in 2018 after a meeting between immediate former US President Donald Trump and Uhuru Kenyatta last February. The two announced that they would start negotiations on the deal. Negotiations did not begin until July 8, 2020, with July 31 of this year being set as the deadline for signing the contract.
However, the deal encountered headwinds earlier this month when it was found that signing would take longer as Washington realigns its interests under President Joe Biden’s administration.
This was most recently revealed during a virtual meeting between Cabinet Secretary for Industrialization, Trade and Business Development, Betty Maina, and US Trade Representative, Ambassador Katherine Tai, to discuss the progress of the talks.
The agreement aims to provide duty-free market access for US industrial goods to Kenya as well as for agricultural, textile and clothing products. The report comes a few months before the expiration of the African Growth and Opportunity Act, of which Kenya is a signatory.
Free Trade Zone America Chamber of Commerce