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Kenya eyes EU market as FTA opens new trade avenues

23 Sep '24
2 min read
Kenya eyes EU market as FTA opens new trade avenues
Pic: Adobe Stock

Insights

  • The FTA between the EU and Kenya, effective from July 1, 2024, is expected to open opportunities for Kenya's cotton, textile, and apparel industry, which currently relies heavily on North American markets.
  • Despite challenges, the industry is growing due to affordable labour.
  • Kenya's presence in the EU market remains small, but the FTA may boost exports, particularly in apparel and home textiles.
A free trade agreement (FTA) between the European Union (EU) and Kenya came into effect on July 1, 2024. Kenya's cotton, textile, and apparel industry is a key pillar of the country's manufacturing sector, experiencing growth driven by cost-effective labour despite facing initial challenges. Currently, Kenya has a negligible presence in the vast EU apparel and home textile market. However, the FTA may provide Kenya with opportunities to enter the EU market, thanks to competitive pricing and the EU’s promotional efforts for least-developed countries.

The FTA, known as the Economic Partnership Agreement between the EU and Kenya, was signed on September 22 last year. Kenya is actively promoting its cotton, textile, and apparel industry across its manufacturing sector. Being labour-intensive, the industry employs both semi-skilled and unskilled workers, making it a key contributor to rural livelihoods.

According to Fibre2Fashion’s market insight tool TexPro, Kenya exported apparel worth $178.531 million between January and June 2024. However, the country remained heavily dependent on North America, with $167.541 million of exports, accounting for 93.84 per cent of the total. The United States and Canada are the major destinations. In contrast, Kenya’s apparel exports to Europe (including the EU and other European nations) were recorded at $4.178 million, a mere 2.34 per cent of its total apparel exports during the same period.

Kenya also exported home textiles worth $13.547 million, with only 2.18 per cent of this going to Europe. Africa was the primary market for Kenya’s home textile shipments, accounting for 90 per cent.

As per TexPro, Europe imported $102.150 billion worth of apparel in the first half of the current year, of which imports from African nations amounted to $5.067 billion, representing just 4.96 per cent of the total. In the same period, Europe’s home textile imports were valued at $13.618 billion, with imports from Africa standing at $303.862 million, or 2.23 per cent of the total.

Fibre2Fashion News Desk (KUL)


This according to Fibre2Fashion's Market Intelligence Tool - TexPro

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