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Kenya says EAC-EU trade talks to conclude before deadline

12 September 2014, 08:00

Nairobi - The government on Thursday said that the ongoing East African Community (EAC)-European Union trade talks will be concluded before the deadline.

Karanja Kibicho, Principal Secretary of Ministry of Foreign Affairs and International Affairs, told a news briefing in Nairobi that the number of outstanding issues has been reduced to one.

"We are now negotiating on how long the EAC will be allowed to maintain exports taxes," Kibicho said during the launch of the United Nations Conference and Development (UNCTAD) Trade and Development Report 2014.

The EAC member states include Kenya, Uganda, Rwanda, Tanzania and Burundi. The deadline for an agreement is Oct. 1.

Kenya is currently engaging in the Economic Partnership Agreement (EPA) negotiations within the framework of the EAC. The EU is the destination for 60 percent of exports from the African, Caribbean and Pacific region.

"We hope to find a common ground before the EAC council meeting on the 22nd of September," Kibicho said.

The EAC's position is that the region should be allowed to maintain taxes on unlimited number of raw materials for a period of four years. However, the Southern Africa Development Community (SADC) negotiated for 12-year period for only eight raw materials.

Kibicho said that Kenya has been lumped with countries classified as Least Developed Countries (LDCs) in the negotiations.

The LDCs will continue to trade with the EU under everything but arms agreement, which provides for duty free and quota free access to the EU. "So the rest of the EAC is not under pressure," Kibicho said.

"However, Kenyan goods will attract import duty before they can access the EU market," he said. According to the Kibicho, Kenya is keen to ensure all the EAC states reach a deal with the EU.

"The trade agreement should not slow down regional integration efforts," the government official said.

The EPAs, launched in Brussels in 2002, are aimed at enhancing sustainable growth, increasing production and supply capacities of the African Caribbean and Pacific (ACP) countries, promoting structural processing and economic diversification of the ACP states while supporting regional integration.

Experts say the East African nation stands to benefit from foreign exchange earnings, employment opportunities and penetration to the EU market with EPAs. The country has enjoyed preferential access to the EU market for the last 38 years through four successive Lome Conventions signed between 1975-2000.

Also read: Mohammed confident EAC will sign European agreements

The intention is to reciprocate the trading terms that the African Caribbean and Pacific (ACP) countries have been enjoying since 1959. But the negotiations have faced stiff competition from the civil society and the ACP's trade experts because of the risk they pose to local enterprises.

As of 2013, the EU accounted for 17.2 percent of Kenya's overall trade. The EU is currently the second largest export market for Kenya as it absorbs close to 25 percent of exports and 14 percent of imports.

 - Xinhua

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