Kenyan manufacturers are pushing Ethiopia to fast-track the implementation of a key trade deal that will give companies from the two states preferential market access. Led by the Kenya Association of Manufacturers, the country wants the Special Status Agreement signed in November 2012 implemented to increased trade and investments.
The agreement was top of the agenda in the bilateral talks between the two countries’ business communities, during Ethiopian Prime Minister Hailemariam Desalegn’s visit to Kenya a week ago. KAM CEO Phyllis Wakiaga yesterday said Kenya is keen on setting up institutions that will spearhead implementation of the agreement, “which has faced numerous challenges since its signing”. “There are immense opportunities for trade and investment both ways,” Wakiaga said.
During Desalegn’s visit, the Kenyan business community called for the harmonisation of the axel-load rule between the two countries, to allow Kenyan trucks to enter Ethiopia. Currently, Kenyan trucks end their journey at the border where goods are offloaded and loaded onto Ethiopian trucks. “We have asked Ethiopia to liberalise their transport section to allow movement into their country. Our transportation and cross-border trade is still low,” KAM head of research and advocacy Peter Biwott said in a separate interview.
Ethiopia’s legal axle load limit is 58 metric tonnes while Kenya’s maximum is 52 tonnes for a six-axle truck, spread out evenly in all the axles. The two governments have also been tasked to speed up the construction of projects under the Lamu Port and Lamu Southern Sudan-Ethiopia Corridor. “The foreign exchange market in Ethiopia is also a major challenge which we expect to be addressed to facilitate trade,” Wakiaga said.
Kenya is eyeing the Ethiopian market whose population is more than 100 million. Ethiopia has for long placed barriers on foreign investors venturing into the telecommunication, banking, media, retailing and insurance sectors.