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Egypt and Kenya explore maritime trade joint agreement. (Shipping).

Egypt and Kenya have not always enjoyed trouble-free trade relations. That will not change overnight but, as ANDREW MAIDEN reports on their proposals for shipping, where there's a will there's a way.

Egypt has invited Kenya to set up a trade council to develop maritime business between the two nations. At a meeting in Mombasa on October 5, officials from the Kenya Ports Authority (KPA) and Egyptian representatives from the Red Sea and Suez Canal ports agreed that both countries would benefit from intra-African trade.

In the meantime both countries have set up working committees to explore the scope of the proposed council. The Egyptians have offered Kenyans the opportunity to train ports personnel at their more advanced ports under the auspices of the council. This is seen as a key plank of any agreement as it enables the Kenyan ports to catch up with those in Egypt. The KPA chairman, Major Gen. (Rtd) Aboud Rafrouf, and other port executives will visit ports in the Red Sea and Suez Canal as part of the joint strategy to strengthen maritime trade opportunities. No timetable has been set for an official inauguration of a council.

A KPA source said that the hardest obstacle to overcome will be that of competition over hinterland markets such as Ethiopia and Sudan. But the training offered by Egypt is seen as an act of goodwill that should allay initial scepticism over competitive motives.

Commenting on the joint agreement, Mostafa El Ahwal, in an address to the members of the Kenya National Chamber Of Commerce & Industry, said: "We are sure to boost trade and ease problems here and enhance activities between both countries."

African observers such as Herman de Meester of the European Community Shipowners Association (ECSA) in Brussels expressed doubts as to the value of a maritime agreement between the two countries: "I can see the logic of Kenya and Tanzania working closely together, but there is no obvious synergy with Egypt."

The initiative comes at a time when both countries have sought to improve relations that have been put under severe strain by years of trade wars. The road to agreement, however, will be a rocky one. Just days after the Mombasa meeting, the two countries clashed on the issue of the export of Egyptian toiletries into the Kenyan market. Kenya Revenue Authority Commissioner General John Munge commented: "There are certain trade protocols in the Comesa treaty that allow member-countries to take action in cases where their industries are being threatened by imports from other countries." Yet press counsellor at the Egyptian Embassy, Sohair Younis, rebutted this claim by saying "Egyptian exports to Kenya are very few. There is no threat of flooding the Kenyan market by products from Egypt." Both countries are signatories to the Common Market for Eastern and Southern Africa (Comesa) Free Trade Area (FTA) protocol which provides for duty-free access for members' products. The protocol looks likely to be disregarded for the immediate future.

In Nairobi on September 20, the two countries had previously agreed to iron out outstanding trade issues on certain products including tea, textiles and tyres. They agreed to adopt a customs certification process similar to that under the US's African Growth and Opportunity Act (Agoa) which entails the removal of commercial invoices and a requirement to identify the products being exported. Currently, trade between the countries is in favour of Kenya in a ratio of six to one.

The jury is still out as to whether the maritime trade council will succeed. But as long as both countries share the will, then the chances of success must be supported. And if the council succeeds, then this could help pave the way for greater understanding between the two nations and bolster wavering commitment to institutions such as Comesa's Free Trade Area.
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Author:Maiden, Andrew
Publication:African Business
Date:Dec 1, 2002
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