Kenya’s trade deficit continues to widen owing to a large import bill dampening the prospect of East Africa’s largest economy sustaining its current growth streak. Persistent trade deficits are limiting the country’s ability to leverage external revenue to finance essential industrialization, export value addition and diversification.
Situational analysis:
Kenya imports more than it exports. Kenya is yet to fully exploit its export potential due to supply side constraints as follows: low productivity, inadequate infrastructure, institutional bottlenecks, lack of information about markets, need for legitimate trade facilitation and for Government to provide an enabling policy environment through a mix of measures including fiscal incentives, institutional changes, procedural rationalization, and enhanced market access across the world as well as diversification of export markets.
The focus of this paper is to understand the importance of “trade not aid” to initiate a narrowing of the trade deficit and the challenges Kenya faces. Kenya must enhance export growth by increasing capacity for value addition in manufacturing sector, enhance regional integration and widen participation in international trade…..
How can AGOA help or not?(discuss the benefits for Kenya….non-reciprocal, but is that good?) is the 10 year renewal a missed opportunity to outline and make changes toward more mature, reciprocal……. Kenya has been saying that they are all grown up now…they are ready for investment and trade being treated “equal”….. Kenya is getting nervous because the TTP and TTIP are reciprocal and are starting to recognize that the US is looking out for itself….
What are the non-tariff trade barriers? What are the challenges of Regional Trade and being part of the EAC customs union?
Security concerns also present a challenge:
The recent security concerns over terrorism and crime are impacting negatively on economic growth especially in the tourism sector. This could have strong repercussions for Kenya given that its tourism industry—one of the most successful in the world—is the third largest industry in Kenya after agriculture and horticulture. Tourism is a socio- economic driver, and one of the largest contributors to Kenya’s current account. In 2013, the United Kingdom led in foreign passenger arrivals, followed by the United
States and Italy.
What is the agenda for Kenya in the upcoming WTO ministerial conference in Nariobi?
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