As Donald Trump prepares for his return to the White House in 2025, concerns are mounting over the potential impact of his proposed trade tariffs on global economies, particularly Kenya's. Trump's administration has threatened to impose tariffs on various countries, including those in Africa, which could disrupt trade relationships that are vital for Kenya's export-driven economy. Currently, Kenya's top trading partners include Uganda, Tanzania, Rwanda, the United States, the United Arab Emirates, and China [70d72ef3].
Kenya benefits from the African Growth and Opportunity Act (AGOA), which allows for duty-free exports to the U.S., encompassing key products such as textiles and coffee. However, with Trump's tariffs looming, experts warn that Kenyan products may become uncompetitive in the U.S. market, jeopardizing the economic benefits derived from AGOA, which is set to expire in September 2025 [70d72ef3].
In the fiscal year 2023/24, Kenya's exports totaled KSh 991.89 billion (approximately $7.66 billion), while imports reached KSh 2.272 trillion (around $17.55 billion), resulting in a significant current account deficit of USD 4,091 million (KSh 530.646 billion) [70d72ef3]. Uganda stands as Kenya's largest export destination in Africa, with exports valued at $892 million (KSh 115.505 billion), highlighting the importance of maintaining favorable trade conditions with neighboring countries and the U.S. [70d72ef3].
Economic analysts are particularly concerned about the implications of Trump's 'America First' policies, which could lead to global economic uncertainty and disrupt established trade flows. The potential for increased tariffs could not only affect Kenya's exports but also strain its overall economic stability, especially as the country seeks to recover from the impacts of previous global economic disruptions [70d72ef3].
As the situation develops, the Kenyan government and businesses will need to strategize on how to navigate the challenges posed by the evolving U.S. trade policies and ensure that they can maintain competitive access to the U.S. market [70d72ef3].