Kenya to receive first South Africa goods under new trade deal

Refrigerators, paperboard and steel products are some of the goods that Kenya is set to receive from South Africa for the first time under the African Continental Free Trade Area (AfCFTA) deal.

The goods left the Port of Durban yesterday destined for the Port of Mombasa after being flagged off by South African President Cyril Ramaphosa. Ministry of Investments, Trade and Industry Cabinet Secretary Rebecca Miano attended the event.

“The Republic of South Africa and the Republic of Kenya have demonstrated their strong commitment to the creation of an integrated African market through the launch of the first consignment to leave South Africa under the AfCFTA framework,” said the Ministry in a statement.

With that shipment, South Africa became the latest country to start trading under AfCFTA, a trade deal that seeks to create a single market for the continent’s 1.3 billion people.

South Africa – which is Africa’s most industrialized country -  now joins Kenya as one of the 12 countries that have already started trading under AfCFTA, which was launched in January 2021.

South Africa launched its first consignment of products, including refrigerators, paperboard and steel products destined for the Kenyan market.

“This is a resounding message that South Africa is ready for business under the AfCFTA framework. South Africa has therefore joined the twelve countries that are exporting under the Continental framework,” said the Ministry.

Kenya was among the first movers on this initiative when it launched its implementation of the AfCFTA by dispatching cargo in 2022 of tea, and later on other products, exported to the African market under the AfCFTA.

To reciprocate South Africa’s move, the Ministry has announced that Kenya is also going to dispatch its consignment of Kenyan products to the South African market under the AfCFTA framework in the coming weeks.

The AfCFTA requires members to phase out 90 percent of tariff lines over the next five to 10 years.

Another 7 percent considered sensitive will get more time, while 3 percent will be allowed to be placed on an exclusion list.

Most of the products traded across African borders will not be attracting any taxes by 2029 or will be attracting as little as a one percent tax.

But products including meat, cut flowers, tea, coffee, and dairy products will continue to attract 3.5 percent in tax up to 2029.

With South Africa commencing trade under AfCFTA, Kenya can expect to get goods cheaper from South Africa once the trade taxes are gradually removed.

South Africa is the largest exporter of goods to Kenya on the African continent.

Nairobi imports motor vehicles, machinery, foods and beverages from Pretoria.

Meanwhile, Nairobi’s largest exports to Pretoria are pearls, precious stones, metals and inorganic chemicals.

Trade is in South Africa’s favour with South Africa enjoying a significant trade surplus.

The implementation of the AfCFTA thus puts the two countries in a good position to increase the level of trade by creating awareness to the exporters, including through the implementation of the respective national AfCFTA Implementation Strategies to ensure optimum benefit from the AfCFTA.

“The two countries further committed to facilitate smooth entry of each other’s products into the market and address non-tariff barriers to boost intra-Africa trade,” added the Ministry.