Kenya to lose Sh9.5b in EU trade agreement

Kenya and the European Union started negotiations for a new trade pact the last week of October amid fears that the country could lose Sh9.5 billion. An impact assessment study conducted by the Kenya Institute for Public Policy Research and Analysis (Kippra) reveals that the Government would lose Sh6.9 billion in revenue. Another Sh2.5 billion would be lost as exporters lose their market share to the EU market to competitors. A further Sh35 million would be lost through trade creation. Already, there are fears Egypt is eating into the EU horticultural market that Kenya had dominated for over a decade now. The new trade pact that would replace the 2001 Cotonou agreement between the 79 African, Caribbean and Pacific countries (ACP) becomes effective in January 2008. However, Trade and Industry permanent secretary David Nalo maintained that the Government is determined to negotiate the new pact.