How Burundi chaos is haunting Kenya’s trade ambitions

Kenya’s hopes of having neighbours sign the much-needed economic partnership agreement with the European Union now depend on how soon the bloc will lift sanctions on Burundi.

At a recent Heads of State Summit in Dar es Salaam, the East African Community resolved to hold any further discussions on the agreement only if Burundi’s situation is discussed in the same forum.

SANCTIONS

“The heads of state noted that the remaining partner states that have not signed the EU-EAC Economic Partnership Agreement (EPA) are not in a position to do so pending clarification of issues they have identified in the agreement,” says the communique issued after the leaders met in the Tanzanian port city.

“The summit also agreed that the EU sanctions on Burundi should be discussed alongside the EPA discussions.”

Kenya was represented by Deputy President William Ruto who used the forum to call for removal of the non-tariff barriers he argued were killing inter-community trade.

Cabinet Secretaries Phyllis Kandie (East African Affairs), Aden Mohammed (Industrialisation), also attended.

TRADE PACTS

But the issue here was the delayed signing of EPAs.

Burundi, a member of the East African Community should essentially have signed, alongside Kenya, Rwanda, Tanzania and Uganda, the Economic Partnership Agreement with the European Union.

The Economic Partnership Agreement (EPA), is a set of trade pacts that allow African countries specific privileges to export to the European Union markets without being subjected to customs.

They cover trade in goods and development cooperation and covers on agriculture, fisheries and economic and development cooperation.

The EU was negotiating with a bloc and required all EAC members to sign.

Only Kenya and Rwanda have signed as others claim the pact as it is may kill local industries.

Yet Burundi is also on the EU’s sanction list for the violence that punctuated President Pierre Nkurunziza’ s third term bid in 2015.

VIOLENCE

In September 2015, the EU European Council imposed restrictive measures against Burundi, targeting four key leaders it argued fuelled the violence.

These measures included a travel ban and asset freeze against those “whose activities were deemed to be undermining democracy or obstructing the search for a political solution to the crisis in Burundi.”

“This approach also takes account of the obligations stemming from the Cotonou Agreement concerning respect for human rights, democratic values and the rule of law, and, in this context, of the possibility of starting the consultation procedures laid down in the Agreement, inter alia in Article 96,” the European Council said at the time, referring to the name of the initial agreement signed in the Benin capital in 2000 and which provides for EPAs.

While the sanctions are to hold till end of October this year, EAC leaders now say Burundi’s isolation is another factor that should be dealt with first.

Ugandan President Yoweri Museveni, who is the new chairman of the EAC Summit, was authorised to lead a delegation to Brussels to discuss the way forward, including discussing what these other countries disagree with.

But there were still ultimatums.

6 MONTHS

“In the event that an acceptable way forward is not reached with the EU within the next six months, the chairperson was authorised to explore the use of variable geometry in implementation of the EPA by EAC partner states working with the council of ministers,” the dispatch says.

Variable geometry is a term used often within the European Union to describe a situation where irreconcilable differences exist among member states.

In this case, the solution if often to allow groups of countries that agree with a certain goal to pursue it while allowing those opposed to it to hold back. 

The agreement provides duty- and quota-free access for Kenyan and EAC products to the EU market.

It also creates new regional opportunities through more flexible rules of origin and accumulation framework.

It guarantees that the EU will not apply export subsidies on products destined for the EAC market.

KENYA

But of the five, only Kenya requires to sign the agreement to enjoy these benefits as it is a developing country.

The rest are considered Least Developed and already enjoy a set of benefits while exporting to the EU.

Tanzania and Uganda have argued signing the EPA as it is would allow the region to be a dumping ground and kill of nascent industries.

The leaders resolved that Kenya should not be “disadvantaged” for signing the EPAS ahead of the group, but offered little guarantee of that protection.