A trade deal recently signed between the UK and Kenya is likely be extended to all members of the East African Community (EAC) trade area, media reports in the UK and east Africa suggest.

The extension would see the UK offering preferential no-tariff, no-quota terms to Kenya’s fellow EAC members: Burundi, Uganda, Rwanda, South Sudan and Tanzania. 

Signing a deal with just one member of the EAC – which has a customs union – had threatened to disrupt regional economic unity, according to legislators in the region and members of the UK’s House of Lords, City AM reports.

One bloc

According to The East African, the other EAC countries had demanded a one-year extension to the UK’s negotiating period with Kenya to allow for a deal to be signed by the bloc as one.

In London, members of the House of Lords argued two weeks ago that it would need more time to ratify the agreement amid concerns the UK government had not addressed the potential impact of the UK-Kenya deal on regional cohesion.

The deal provides Kenyan businesses duty-free access to the UK market, aims to support jobs creation and economic development, and prevents disruption to UK businesses by maintaining preferential arrangements they had when the UK was still a member of the EU.

In 2019, UK-Kenya trade was worth an estimated £1.4bn and the UK is a major market for Kenyan exporters of tea, coffee, flowers and fresh vegetables.

Rollovers

Since leaving the EU, the UK has been able to forge its own independent trade ties with other countries.

According to Quartz Africa, the UK had managed to roll over EU trade terms with 15 African countries by the start of 2021, accounting for £21.4 billion ($29.2 billion) of annual trade. It has since agreed an additional rollover deal with Ghana.

The UK has also adopted the EU’s generalised scheme of preferences, which gives 35 African countries reduced or zero tariffs for exports to the UK.

Investment opportunities

The UK has expressed an interest in developing its economic ties with African countries since leaving the EU.

In January last year, the UK held its first major international investment event as an independent trading nation following its withdrawal from the EU and the conference focussed on doing business with Africa.

Speaking at the Africa Investment Conference, Boris Johnson said his ambition was “for the UK to be Africa’s investment partner of choice,” reports the Daily News Egypt.

“The UK has a huge role to play in realising long-term prosperity for all African nations,” he also said.

African free trade area

Africa is a growing market for the UK, particularly following the continent’s creation of its own free trade area through the African Continental Free Trade Agreement.

The African Continental Free Trade Area (AfCFTA) created a shared market between 54 signatory countries with the potential to rival other trade blocs.

However, ratification of the continental trade agreement is an ongoing process in many of these countries.

Trillion-dollar market

AfCFTA covers a market of 1.2 billion people and a gross domestic product (GDP) of $2.5 trillion, reports Euractiv.

Estimates from the Economic Commission for Africa (UNECA) indicate that AfCFTA has the potential to boost intra-African trade by 52.3% by removing import duties and reducing non-tariff barriers.

The BBC reports that the deal promises to make trade easier across the continent, with tariffs on 90% of goods to be phased out within 10 years.