Sunday, May 3, 2009

Kenya: Govt Told to Utilise Comesa

Cedric Lumiti, East African Business Week, 25 April 2009

Kenya has been challenged to exploit opportunities that exist in the wider Common Market for Eastern and Southern Africa (COMESA).

Kenya's trade minister, Amos Kimunya last week said these opportunities could cushion Kenya from the imminent challenges posed by the ongoing global recession.

The COMESA trading bloc presents an expanded regional market with a population of over 500 million cutting across 19 countries spread across Africa.

"Our region has not been affected as much by the global economic downturn, so if we can think of exploiting that extra market within the wider COMESA which right now we are not doing very well, then we would be able to shield ourselves from the recession that has hit the United Kingdom, parts of Asia and the United States of America," he said.

Currently COMESA member states are actively pursuing the merger with the Southern African Development Community (SADC), which would also provide an opportunity for member countries to diversify their exports.

Addressing members of American Chamber of Commerce of Kenya last week, Kimunya expressed confidence that Kenya's economy may recover quickly and surpass this year's under-three percent growth projections.

While acknowledging that the financial crisis would slow down Kenya's growth rate, he was optimistic the country was in a strong position to weather the downturn and continue with its positive growth that was witnessed a few years ago.

The government estimates the economy will grow between two and three percent but the African Development Bank (ADB) has reviewed that figure upwards to 5.5 percent.

"I am seeing signs of earlier recovery. ADB has started re-evaluating those targets and we hope that as the markets pick up elsewhere we might just be lucky, especially with more penetration within the region. We might actually see better times than the two to three percent," he added.

The minister disclosed that preparation for the eighth forum of the African Growth Opportunity Act (AGOA), which will be held in Kenya between August 4 and 6, were in top gear.

The ministerial discussions will be held on August 5-6, and the private sector and civil society groups will hold related events on August 4.

Mr. Kimunya said a steering committee, composed of various stakeholders in the government and the private sector, has been formed to deal with the several aspects of the preparations of the meeting.

"The committee has been meeting since November 2008 and has had sittings with representatives from the US government," he said adding that website had been developed to provide information on the AGOA forum to all concerned parties.

AGOA was launched in October 2000 and offers duty free and quota free market access to the US market through 6,000 product lines. Kenya was one of the first countries to be granted eligibility to export to the USA under this facility.

However, it has only been able to export a few products, specifically textiles and handcrafts, due to demand and supply constraints.

The meeting will provide an occasion for government officials, private sector representatives and the civil society from USA and the 38 AGOA eligible countries to interact and exchange ideas on how best the opportunities created by AGOA can be fully exploited.

"Additionally, an exhibition will offer both the US and AGOA countries the chance to showcase their products with a view to concluding some business deals," Kimunya hoped.