Kenya’s long-anticipated trade and investment agreement with the United States, which began in 2018, now faces potential setbacks due to political changes in the U.S. Donald Trump’s return to the White House is expected to bring policy shifts that could disrupt the momentum of this deal, which was initially projected to conclude by next month.
Although the agreement holds big economic promise for both nations, Trump’s trade policies, often characterized by protectionism, may complicate the process.
The Kenya-U.S. Free Trade Agreement (FTA) discussions were launched in 2018 under former U.S. President Donald Trump’s administration.
The talks aimed to create a comprehensive trade and investment deal that would give Kenya favorable access to U.S. markets while also attracting American investments into the East African nation.
This initiative marked a historical shift for Kenya, as it was set to become the first Sub-Saharan African country to negotiate a bilateral trade agreement with the U.S., breaking away from broader regional trade deals like the African Growth and Opportunity Act (AGOA).
Kenya views the agreement as a critical step toward expanding its export market and enhancing its industrial sector by attracting investment from U.S. companies.
Key sectors in Kenya, such as agriculture, textiles, and manufacturing, would benefit from improved access to the American market, allowing them to compete on a larger scale.
Additionally, the deal would potentially create employment opportunities, stimulate technological transfer, and foster skills development in Kenya.
However, the return of Donald Trump to office introduces uncertainty regarding the future of the trade talks.
During his first term, Trump championed an “America First” approach that prioritized domestic economic interests and often scrutinized trade deals for their impact on American jobs and industries.
Given his track record, Trump may push for stricter conditions that could disadvantage Kenyan exporters or reduce the scope of market access previously envisioned.
This could lead to prolonged negotiations, as Kenya would likely resist any terms that undermine the benefits it seeks from the agreement.
In addition to these possible restrictions, Trump has previously displayed a tendency to renegotiate or abandon trade agreements he deems unfavorable to the U.S.
This approach led to revisions of several high-profile agreements, such as the renegotiation of the North American Free Trade Agreement (NAFTA) into the United States-Mexico-Canada Agreement (USMCA).
His return may mean a reassessment of the Kenya-U.S. FTA, potentially delaying its conclusion and altering the terms Kenya hoped to secure.
The uncertainty also places Kenyan leadership in a challenging position. President William Ruto’s administration has expressed a commitment to strengthening Kenya’s ties with global economic powers, and the U.S. is one of Kenya’s key trade partners outside of Africa.
Delays or setbacks in the FTA talks may force Kenya to re-evaluate its trade strategy and consider alternative partnerships or alliances, especially with other economic blocs like the European Union or China, both of which have shown increasing interest in African markets.
At the same time, Kenyan exporters and businesses are watching the developments closely.
Many had anticipated favorable terms that would allow them to expand operations and increase exports to the U.S. under the new agreement.
Any delays could impact their growth plans, as well as investment decisions by U.S.-based companies eyeing Kenya as a potential base for operations in East Africa.Moreover, a protracted negotiation process could influence Kenya’s overall economic performance, as sectors like horticulture, coffee, and tea, which are major export earners, had high expectations for new opportunities under the FTA.
The prolonged uncertainty might also impact investor confidence, as many international investors look for stable and predictable trade policies before committing substantial resources to foreign markets.
While both nations stand to gain significantly from a successful trade agreement, Trump’s return introduces complexities that make the future of the Kenya-U.S. trade deal uncertain.
