Expenditure on imports from Uganda declined 9.09 per cent in the first quarter of the year, pointing to the impact of an on-and-off tiff between Nairobi and Kampala over the entry of key agricultural goods such as eggs and milk powder.
The value of goods trucked into Kenya from Uganda through formal routes dropped to Sh7.48 billion in the three months through March 2024 compared with Sh8.23 billion the year before, according to provisional official trade statistics.
Reduced imports from Uganda at the time exports grew 7.17 per cent to Sh33.02 billion, helped widen Kenya’s goods trade surplus with its largest business partner to Sh25.54 billion from Sh22.58 billion the year before.
Ugandan authorities have over the years complained of a blockade of goods such as eggs, sugar, milk powder, and grains in protectionist policies aimed at shielding Kenyan farmers.
The rising trade barrier between the two countries was part of the agenda during Uganda’s President Yoweri Museveni’s two-day State visit to Nairobi in early May.
“We have agreed that trade between the two countries is unimpeded either by tariff or non-tariff barriers or arbitrary levies,” Kenya’s President William Ruto said on May 16 following Mr Museveni’s visit.
“We have agreed that the common principle will be the full implementation of the EAC customs and other infrastructure that support trade between East African countries. Therefore, all the issues around rice, juice, furniture, eggs, chicken, and sugar are now resolved.”
Brookside Limited, owned by parent company Brookside Dairy of Kenya, however said it is among the most affected businesses, with up to 114 export permits denied by the Kenya Dairy Board since March last year.
“We were delighted to read the communique signed by the two countries when the two heads of State met in Nairobi, as we believe it was key to unlocking trade barriers that have existed since March last year. However, a month later, we are yet to receive export permits for our long-life milk, which includes powder and ultra-high temperature (UHT) processed milk,” Benson Mwangi, Brookside Limited’s general manager, told a media briefing in Kampala last week.
Although Kenya has been Uganda’s main market for dairy products, emerging trade restrictions have seen Kampala search for new markets, mainly in North and West Africa.
Mr Mwangi said Brookside Limited had written several reminders to the Kenya Dairy Board (KDB) on the pending permit applications.
Still, unfortunately, no response has been received so far from the regulator.
