The Budget and Appropriation Committee wants Kenya to conduct a study on key existing and potential export markets, to drive growth of the sector.
The State Department for Trade has been tasked to undertake the survey, which will also look into the need to establish trade offices or logistical centres in various regional economic blocks and countries with bilateral relationship with Kenya.
This is in order to focus on international export opportunities that match Kenya’s current and potential business capability, the MPs say, noting the country’s exports fall way below the potential.
“The study should be completed by December 31,” the committee led by Kieni MP Kanini Kega has said.
Kenya’s export quality has largely remained unchanged with the country exporting most raw , primary products as opposed to manufactured goods, the committee has further observed.
“Our export volumes have remained below potential mainly due to failure to meet the market phytosanitary requirements and quality standards. The country is also underrepresented in terms of trade representative offices in key existing and potential export markets,” the Mps have noted in their report on the 2021/2022 financial year budget.
While the National Treasury has proposed to post 22 trade attaches in various missions abroad, the the number is not enough, the committee has noted.
To facilitate the expansion of exports and growth, the Mps wants an export management office (EMO) established, which will have representation from all agencies that deal with the entire export value chain of Kenyan products.
This will be led by among others, the Kenya Export Promotion and Branding Agency.
“The office should be domiciled in the State Department for Trade. A status report on the establishment of the office should be submitted to the National Assembly by September 30, 2021,” the report reads in part.
Meanwhile, there are concerns that budget allocations are not addressing supply side constrains pertaining to exports which has “severely” constrained the country’s export earnings potential.
According to the legislators, the State Department of Trade and Enterprise Department is underfunded by approximately Sh8.4 billion and may not be able to meet its priority objectives.
There also lacks initiatives to support exporters whom the committee refer to as “extremely important to the economy”, as they offer market for Kenyan products.
Tea, horticultural products, coffee, petroleum products, fish, cement, apparel are Kenya’s main export products.
Key export markets are Uganda, Pakistan, United States, Netherlands, United Kingdom, Tanzania and United Arab Emirates.
Last year, domestic exports (originating from Kenya) increased, buoyed by more intra-EAC trading as the pandemic reduced global shipment activities.
For the 10-months to October, the value of exports totaled Sh464.9 billion, Kenya National Bureau of Statistics data shows, an increase compared to Sh437 billion worth of exports shipped out of the country in a similar period in 2019.