Kenya’s earnings from exports to the US grew by 27.4 percent in the half year ended June this year, signalling a pick-up in demand ahead of President Donald Trump’s imposition of a 10 percent tariff on goods starting August 1.Kenyan traders sold goods worth Sh52.59 billion to the world’s largest economy in the review period, according to data collated by the US Census, marking a jump of 27.4 percent over Sh42.09 billion in 2024. Growth in the value of exports is a rebound from the 14.9 percent fall recorded in 2024. The performance was mainly attributed to knitted men’s undergarments at Sh441.69 million, representing a 682 percent growth. Other commodities that posted remarkable growth include knit t-shirts at Sh345.8 million (a 229 percent growth) and coffee at Sh338.1 million (a 65.2 percent growth). The expansion comes at a time when Kenya is seeking to coin a new trade agreement with America before the expiry of the African Growth and Opportunity Act (Agoa) next month. Kenya largely exports textiles and macadamia nuts to the US at zero tariff and no restrictions on quantities under Agoa.For the country, the impact of Agoa has been significant, with the establishment of dozens of garment knitting firms in export processing zones across the country. The stats are noteworthy.Under Agoa, the number of enterprises had grown from 28 in 2020 to 40, while the number of employees in the same period had increased from 45,588 to 66,804 by the end of 2024. With Agoa deal expiring, the goods that were enjoying zero tariffs will now be subjected to a 10 percent tariff. The downside of a 10 percent tariff on all exports to the US poses a significant risk to the textile industry, which accounted for a large share of Kenya’s exports to the US. As a result, Kenya’s goods that were previously exported under Agoa will be exposed to stiffer competition, leading to reduced margins for the exporters. While Kenya’s 10 percent tariff will have a huge impact on exports to the US, countries such as South Africa will incur a huge burden with the 30 percent tariff, the highest in Sub-Saharan Africa. (ICE NAIROBI)

Fonte notizia: Business Daily