Tanzania turns tables on Kenya as exports grow to $396m

The trade wars are a drag on what the region could achieve under a more open trade regime.

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Kenya’s imports from Tanzania exceeded exports by nearly a third in nine months through September 2021, fresh official statistics show, signaling thawing trade ties following regime change in Dar es Salaam.

Nairobi posted a goods trade deficit of $80.16 million, or 29.97 percent, with Dar es Salaam — the first over the review period going by publicly available data — after traders doubled orders from the south-neighbouring country.

Imports from Tanzania jumped to $396 million in January-September 2021 period from $347.6 million a year earlier, provisional data from Kenya National Bureau of Statistics (KNBS) shows.

Kenyan traders and factories largely source cereals, wood, edible vegetables, animal fodder, paper and paperboard from Tanzania.

The 101.76 percent surge in value of goods bought from Tanzania dwarfed 34.81 percent growth in exports to $267.47 million, leading to the hitherto rare deficit in merchandise trade in the period.

Kenya’s exports to its East African Community partner include pharmaceutical products, plastics, iron and steel.

“There are a lot of positive vibes within EAC that are developing and we want to ride on that to bring back the EAC that used to be. For example, relations between Kenya and Tanzania are significantly better,” Adan Mohamed, kenya’s Cabinet Secretary for EAC Affairs.

“Ultimately, as government, we try and make sure that the environment is suitable for the private sector to do business.”

Samia’s first top

The bump in trade flows between the two countries happened on the back of a pledge between President Uhuru Kenyatta and his counterpart Samia Suluhu early May to end on-and-off trade tiffs between EAC’s two largest economies.

President Samia made Nairobi her first stop as she sought to strengthen trade ties with EAC partners.

During her visit she made it clear that it was her priority to put an end to unresolved strained trade relations between the countries, which have hindered smooth flow of goods and services over the years.

The KNBS data shows the gap between imports and exports has been widening since the beginning of the year in favour of Tanzania. The deficit in merchandise trade stood at $10.86 million in first quarter, $16.12 million in the second and nearly $53.17 million (July — September).

Tanzania is the only country in the six-nation EAC trading bloc that ran a surplus with Kenya in the review period, according to the provisional data.

Kenya had a trade surplus of $313.73 million and $145.57 million with Uganda and Rwanda, respectively.

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