NAIROBI (Reuters) - Kenya has delayed talks on a trade deal with the United States until a pan-African trade bloc comes into force, President Uhuru Kenyatta said on Thursday, likely holding up what would be Washington’s first such pact in sub-Saharan Africa.
U.S. President Donald Trump and Kenyatta agreed in February to start formal talks on a bilateral trade pact that might help offset concerns about China’s expanding investment imprint on the continent.
Kenya wants to do a deal with Washington before the expiry of the Africa Growth and Opportunity Act (AGOA), which allows sub-Saharan African states to export thousands of products to the United States without tariffs or quotas until 2025.
Kenyatta said Kenya, East Africa’s richest economy, had delayed discussions with Washington until the Africa free trade arrangement comes into force, originally set for July 1 but now delayed until later by the coronavirus pandemic.
“When we met with the United States... we made it clear that negotiation would have to be done on the basis of, and without undermining, the Africa free trade arrangement,” Kenyatta said.
“This works not just for Kenya and Africa, but I also believe it works for the United States, because it gives that wider market access,” he added during a webinar hosted by the Atlantic Council.
It was not immediately clear how long the delay to the talks would last.
Two-way goods trade between the United States and Kenya totalled $1.1 billion in 2019, up 4.9% from 2018.
The African continental free-trade zone, when it comes into effect, would become the largest since the creation of the World Trade Organization in 1994, connecting 1.3 billion people together in a $3.4 trillion economic bloc.
U.S. Trade Representative Robert Lighthizer said on Wednesday he hoped to reach a strong free trade agreement with Kenya that could eventually be replicated with other African countries. Negotiations will begin soon, he said.
Reporting by Omar Mohammed in Nairobi with additional reporting by Andrea Shalal in Washington; Editing by Mark Heinrich