Central Bank of Kenya (CBK) Governor Kamau Thugge has moved to reassure stakeholders about the proposed 10% tariff increase on Kenyan exports to the United States, emphasizing that the anticipated economic repercussions are expected to be minimal.
Governor Thugge acknowledged the concerns raised amid the ongoing review of the African Growth and Opportunity Act (AGOA), which currently grants duty-free access to Kenyan products such as textiles, apparel, coffee, and tea. However, he underscored that the impact on Kenya’s economy would be limited.
“While the projected loss of approximately $100 million in exports is not insignificant, it is relatively modest when compared to our GDP, which stands at over $122 billion,” Thugge explained. “We do not foresee any major disruptions to the balance of payments or to the exchange rate.”
Kenya exports roughly $650 million worth of goods to the US annually under AGOA, and the proposed tariff hike has sparked concerns among local exporters. Nevertheless, Thugge expressed confidence in the country’s robust economic fundamentals, suggesting that Kenya remains well-positioned to weather any potential trade shocks.
His remarks come at a critical time as discussions continue around AGOA’s future and its implications for African economies. Despite the uncertainty, Thugge’s reassurances signal stability and resilience within Kenya’s broader economic landscape.
