The European Union (EU) and Kenya have successfully concluded negotiations on an ambitious trade agreement aimed at implementing the regional Economic Partnership Agreement (EPA) between the EU and the Eastern African Community (EAC) on a bilateral level.

This agreement is a significant milestone as it will be the first trade deal with an East African Community country to come into force. While a regional EPA was negotiated in 2014 and signed by Kenya, Rwanda, and the EU in 2016, it could not be implemented as it required signature and ratification by all EAC countries. The EU-Kenya agreement now enables the bilateral implementation of the provisions outlined in the Economic Partnership Agreement between the EU and the EAC Partner States. The agreement will also be open for accession by other EAC Partner States.

The EU-Kenya partnership agreement is vital for a number of reasons, including trade and investment opportunities, agriculture, industrial development and trade diversification, trade and sustainable development and implementation and monitoring of the EPA. These issues are delineated in more detail below.

The agreement provides free access to the EU market for all Kenyan exports of goods (excluding arms) by eliminating tariffs and quotas. Trade liberalization will be likely, however, be asymmetrical, with Kenya gradually opening its market to EU imports, throughout differing levels of development. Kenya will have transitional periods and sensitive products exempted from liberalization. The agreement further includes provisions to address unfair trade practices, such as dumping products at unreasonably low prices. Safeguards are also in place to reintroduce duties if imports from either side disrupt or threaten the economies, and unjustified or discriminatory import/export restrictions will be prohibited. Rules of Origin will define the products eligible for trade preferences, and a new protocol on rules of origin will be negotiated within the first five years of implementing the EPA. The EPA promises to be particularly beneficial to smaller entities, as their customs procedures (in addition to, but more advantageously than for bigger entities) will be streamlined to facilitate trade.

In addition, the agreement focuses on sustainable agricultural development, food security, rural development, and income and job creation in Kenya’s agricultural sector. It aims to ensure that the EU will not apply export subsidies for agricultural products, even during times of market crises. Provisions on animal and plant health and hygiene (sanitary and phytosanitary measures) aim to address related trade issues, promote intra-regional standard harmonization, and enhance Kenya’s capacity to implement and monitor these measures, and in this rgeard the EU will provide development assistance to support farming, rural employment, and compliance with agricultural standards, enabling easier access to the EU market for Kenyan agricultural products. To prevent the development that is envisioned to occur as a result of the EPA from being stifled due to disagreements between Kenya and the EU, an effective dispute resolution mechanism will be established to address any disagreements.

A dedicated chapter has also been added on trade and sustainable development, covering issues such as labor, gender equality, environmental protection, and climate matters. The EPA commits both parties to respect and promote fundamental labor rights, implement UN standards to prevent gender discrimination and empower women, and adhere to multilateral environmental agreements, including the Paris Agreement. The EU’s approach to these commitments centers on cooperation, engagement, regulatory dialogue, technical assistance, and capacity building. As the trade and sustainable development commitments are binding and enforceable, the EPA also contains a dispute settlement mechanism for violations.

Importantly, the EPA establishes ministerial, senior official, and technical bodies to oversee and support its implementation. An economic and development cooperation chapter aims to enhance Kenya’s competitiveness by building supply capacity and facilitating the smooth implementation of the EPA. The agreement allows for the addition of new areas, such as trade in services, competition policy, investment and private sector development, intellectual property rights, and transparency in public procurement, within five years after the agreement’s entry into force. Civil society representatives, including business associations, trade unions, and non-governmental organizations, will have a role in the agreement’s implementation. Domestic advisory groups and a Consultative Committee will provide advice and facilitate regular meetings between EU and Kenyan civil society representatives.