Apr 15, 2020
WASHINGTON, DC – In February, the Office of the U.S. Trade Representative (USTR) announced their intention to begin negotiating a trade agreement with Kenya, a move that could lay the groundwork for a series of agreements with African nations in the years to come.
USA Rice submitted comments to USTR today as part of a solicitation process, outlining the industry’s ask and to aid in the development of the Administration’s negotiating objectives to be released later this spring.
Kenya’s rice-heavy diet, burgeoning population, and growing middle class make the country a potential market for U.S. rice exports. Like rice imports for most of Africa’s markets, Kenya’s more than 600,000 MT of imports are very price sensitive, sourcing essentially everything from Asia in recent years. A combination of high tariffs, prices, and logistical challenges make U.S. exports uncompetitive in Kenya, but an agreement could change that.
In recent years, the Kenyan government has sought an annual waiver that allows rice to enter with a reduced tariff assessment, 35 percent, and without that waiver, U.S. rice and other importers would face a 75 percent tariff. Therefore, USA Rice’s comments recommend that “the U.S. government adopt a negotiating objective of duty-free and quota-free access for all types and forms of U.S. rice in any free trade agreement with Kenya.”
The comments added that zero duties combined with “opportunities for U.S. exporters to bundle rice shipments with other commodities or restructure their transportation routes for convenience,” would allow U.S. rice to become a serious competitor in the Kenyan market.
The official comments also reiterated that gaining duty-free access to Kenya would be “a strong precedent that could lead to increased regional business for U.S. rice exporters.”
USTR has not yet announced a start date for formal discussions with Kenya.