Editor's note: Stephen Ndegwa is a Nairobi-based communication expert, lecturer-scholar at the United States International University-Africa, author and international affairs columnist. The article reflects the author's opinions and not necessarily the views of CGTN.
News last week that Kenya and the United Kingdom had agreed to enter a new trade agreement received lukewarm reception from the business community of East Africa's largest economy. This will be the sixth such deal the UK will be signing with an African country after its Brexit detachment from the European Union (EU) in January.
The trade deal is an offshoot of the five-year strategic partnership signed between the UK and Kenya in January during the Africa Investment Summit. The event sought new lasting partnerships between the UK and African countries.
According to the UK Department for International Trade, the UK-Kenya deal seeks to grow trade between companies on both sides from the current 1.4 billion British pounds ($1.85 billion) through mutual tariff-free market access. Kenya's exports to the UK comprise mainly agricultural and horticultural produce while the latter's exports comprise machinery and manufactured goods.
The deal is also part of the new UK Generalized Scheme of Preferences (GSP) which starts on January 1, 2021. The GSP aims at reducing or removing rates of duty (tariffs) on developing countries' products coming into the UK. But it is important to note that the scheme is a Brexit rollover from EU's GSP which has a similar role up to December 1, 2020.
It is instructive that the UK is trying to get back into the game after years of dealing as part of the EU. From decades of experience, Britain is cognizant of the fact that Kenya remains the gateway to markets of the East African Community member countries. Furthermore, the former colonizer has played a major role in making Kenya the largest economy in the region through its investments both prior and after independence in 1963.
Although the two countries have more than a century of historical ties, the relationship this time is more complicated. First, it is becoming a full house, with negotiations already ongoing on the Free Trade Agreement (FTA) between Kenya and the U.S., which was launched in July.
But experts have criticized the proposed U.S.-Kenya deal, with the UN Conference on Trade and Development Secretary-General, Mukhisa Kituyi, a Kenyan, terming it lopsided in favor of the superpower.
Secondly, the UK-Kenya proposal will soon come against China's headwinds. Like Siamese twins, Sino-Kenya trade relations are conjoined in very critical economic sectors where there may be little room for the UK. China has arguably become Kenya's biggest trading partner, accounting for 17.2 percent of the country's total trade.
Out of its own failure to do so when it had the wherewithal and time, the UK will have to ride on modern infrastructure laid down mainly by China. In its many decades of relations with its erstwhile colony, Britain focused mainly on importing agricultural based raw materials for export after value addition, at many times over the purchase price.
Although this practice is not exclusive to the UK, the latter hardly made any genuine attempts at building its partner's capacity. Any such gestures were cosmetic, involving the final assembly of, for instance, motor vehicle knock down kits. The aim was to exploit Kenya's cheap labor with negligible technology transfer.
The status quo above still holds. Going forward, it will be a case of once bitten, twice shy. Tensions between the two countries reached its zenith after the West-backed overt regime change advocacy in its former colony. With the Cold War over in the 1990s, the Western bloc exerts its influence on Kenya in a bigger way, which led to the push for the country to adopt a multi-party democracy system.
For the avoidance of doubt, media reports indicate that the UK-Kenya deal has triggered trade tensions in the East Africa region, with Nairobi's efforts to negotiate alone said to risk undermining the EAC's customs union. The other EAC members are seeking a temporary trade arrangement with the UK before beginning negotiations as a bloc in 2021.
The Kenyan situation is bound to play out as the UK seeks more partnerships in the African continent. For instance, Ghana's reaction to a new trade deal with the UK in October represents the prevailing predicament many African countries are facing.
According to an article by Graham Lanktree in POLITICO, "Ghana won't sign new UK trade deal in 2020," published on October 21, there is a feeling that the UK could be playing the same old divide-and-rule colonial tactics and politics, placing potential partners in an awkward position with their neighbors.
The article notes that regional trade tensions have made agreeing on a deal tricky, with Ghana "very reluctant to break off from the West African bloc" as it could lead to increased trade restrictions with its neighbors.
Indeed, with the recent establishment of the African Continental Free Trade Area, it might be mission impossible for the UK. The latter could be biting more than it can chew.
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