Kenya's hits and misses for AfCFTA one year on

Kenya launched its AfCFTA implementation strategy in August 2022, with the goal of consolidating, diversifying, and expanding exports to African markets and ensuring that its manufacturing sector attains 5 per cent real value-added increases per annum. The implementation of the African Continental Free Trade Area (AfCFTA) has been closely monitored over the past year, providing insights into the hits and misses for African countries, particularly Kenya. CNBC Africa spoke to Paras Shah, Managing Partner at Bowmans, to assess the progress made and the challenges faced by the country and the continent as a whole. Shah highlighted the potential benefits of intra-Africa trade, such as increased foreign direct investment, job creation, and manufacturing capacity. However, he also pointed out that intra-Africa trade currently accounts for less than 3 per cent of global trade, indicating significant untapped potential. Kenya, under the leadership of President William Ruto, has been a frontrunner in embracing the AfCFTA, ratifying the treaty early on. The country's strategic position in sectors like technology and mobile payment solutions puts it in a favorable position to facilitate trade with its African neighbors. Since the launch of the Guided Trade Initiative in August 2022, which includes countries like Cameroon, Egypt, Ghana, and Kenya, progress has been made in initiating preferential trading arrangements. While challenges remain, the region is moving forward with enthusiasm and determination. An essential aspect of advancing the AfCFTA agenda lies in addressing customs harmonization and border control issues across African countries. Kenya has made significant strides in this area, having processed thousands of AfCFTA certificates of origin and gazetted tariff schedules for Category A products within the East African community. However, the continent as a whole faces obstacles related to infrastructure, particularly high transportation costs that hinder the movement of goods within Africa. Capacity building in the manufacturing sector is also crucial to ensure the competitiveness of African products compared to imports from other regions. Additionally, the harmonization of regional trade blocs and the expansion of support services like legal and accounting firms are vital for the successful implementation of the AfCFTA. Shah emphasized the importance of enhancing dispute resolution mechanisms and promoting freedom of movement for people within Africa to further facilitate trade. While challenges lie ahead, countries like Kenya are focused on overcoming obstacles and driving progress in intra-Africa trade. The commitment and efforts of such nations are crucial in paving the way for broader continental cooperation and economic growth.