Kenya and Ethiopia formalized a bilateral agreement on Thursday to work together on implementing the African Continental Free Trade Area (AfCFTA). Senior government officials from Kenya and Ethiopia signed a Memorandum of Understanding (MoU) to expedite the implementation of a simplified trade regime between the two countries.
While speaking in Mombasa, Kenya’s Cabinet Secretary for Investments, Trade, and Industry, Lee Kinyanjui, emphasized the government’s commitment to improving trade efficiency at the Moyale border, tackling persistent issues affecting local communities.
Kinyanjui affirmed that the agreement aims to promote free trade among border communities. He outlined that Kenya and Ethiopia explore strategies to adopt free trade, facilitating the movement of goods between the two nations and enabling individuals to work across borders. He added sectors like tourism and others in Mombasa are expected to gain significant benefits from the initiative.
Kinyanjui also pointed out Ethiopia’s vital supply of essential goods to Kenya and Kenya’s finished industrial products to Ethiopia, describing the partnership as mutually beneficial. He also encouraged local investment, emphasizing government investment in the infrastructure to enhance cross-border trade.
Ethiopia’s Minister of Trade and Regional Integration, Kassahun Gofe, stressed the need to finalize negotiations to initiate the simplified trade regime to augment cross-border trade among communities in Kenya and Ethiopia. Gofe stated that the discussions addressed two main pending issues: the scope of border trade and trading thresholds, along with travel frequency and a standardized list of product prices.
He further noted that an agreement was reached to define the border areas for trade, setting Ethiopia’s boundary at 50 kilometers and Kenya’s at 100 kilometers from their shared border. Additionally, he mentioned that the agreed value threshold for trade would be 1,000 US dollars, with a maximum of four transactions per month and a unified list of eligible products.
“We have finally signed the agreement after two years of serious negotiations; thus, the main issue will be implementing and starting trade of what was agreed,” Gofe added.
The agreement followed the third bilateral meeting in Mombasa. Ethiopia also agreed to draft and share the instrument for the simplified trade regime.
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