NTV Kenya
Thursday February 27, 2025
Kenya and Somalia are discussing a trade facilitation agreement meant to eliminate irregular non-tariff barriers between the neighbouring countries.
Somalia joined the East African Community (EAC) in December 2023, becoming the eighth member of the regional bloc. But its trade with Kenya is often faced with multiple levies, policy shifts and non-tariff barriers. That is largely because Somalia is still implementing key trade protocols, which are intended to enable it to be at par with EAC members on regional free trade.
At the Somalia-Kenya Trade Week that opened on Wednesday in Nairobi, Kenya’s Trade Cabinet Secretary Lee Kinyanjui said the upcoming MoU will prioritise removal of non-tariff barriers, border security, enhance customs clearance systems among other measures.
“To strengthen trade and investment, Kenya and Somalia must explore key areas of cooperation. One crucial step is finalising the Memorandum of Understanding (MoU) on Promotion of Trade Cooperation, which will facilitate smoother trade relations between the two countries,” said CS Kinyanjui at the BBS Mall in Eastleigh, Nairobi.
Several key recommendations, he said, should be considered. They include establishing a joint trade committee to address non-tariff barriers (NTBs).
The event jointly organised by the Nation Media Group PLC and the Somali Embassy in Nairobi was also graced by the Somalia Minister for Planning, Investment and Development, Mohamud Abdurrahman Sheikh Farah, and Somalia ambassador to Kenya, Jabril Abdulle.
NMG Board Chairman, Wilfred Kiboro, called for increased trade between Kenya and Somalia.
Somalia has a growing economy with vast potential for investment, particularly in sectors such as agriculture, fisheries, manufacturing, and infrastructure development. Its fisheries sector is said to be worth about Sh258 billion ($2 billion), according to Mogadishu’s estimates, based on its 3,000km coastline, the longest on mainland Africa.
The country’s coastline presents immense fishing and maritime trade opportunities.
“Second, both nations should prioritise border security and trade facilitation measures to curb illegal trade while enhancing legal commerce. This can be achieved by upgrading border customs offices in Garissa, Wajir, and Mandera and improving the efficiency of customs clearance systems,” said CS Kinyanjui. “Strengthening trade regulations and ensuring transparency will also play a vital role in boosting investor confidence,” he added.
Kenya’s exports to Somalia were already significant before Mogadishu joined EAC. In 2023, the exports value hit Sh20.2 billion ($155.2 million).
Key exports include khat, dairy products, cereals, pharmaceuticals, cement, steel, edible oils, tobacco, and detergents. But some khat exports have faced irregular levies and sometimes un-announced flight cancellations.
Kenya’s imports from Somalia were valued at approximately Sh45.2 million ($348,000) in 2023. They included fish, livestock, sesame seeds, fruits, natural gums, essential oils, and scrap metals.
Despite the challenges of political instability, the Somali government has made efforts to stabilise the economy and attract foreign direct investments, according to Mr Farah who called for fair trade rules.
“This trade week takes place at an important time as Somalia enters a new era of optimism and progress. It will for sure enhance our bilateral trade and investment cooperation and further strengthen our economic partnership in many fields of mutual interest,” said the Somali trade minister.
Dr Kiboro cautioned against importation of secondhand clothes and footwear that could be made in African countries.
“Why do we have to continue importing second-hand clothes when we could be manufacturing them right here? These are not things that we should be importing from China or from Europe,” said Dr Kiboro.
“The only way for Africa to develop is to get out of this cycle and we start trading with one another. We have a population of about 1.4 billion people in Africa and very young people,” he added.
Dr Kiboro also called for a re-look at government policies harming free trade, saying, “there is no reason why we cannot grow cotton.”“It is not rocket science to manufacture clothes and fabrics and everything else that actually uses very low-level technology but why are we not doing it?
“The cost of energy in Kenya is one of the highest in the world, I don’t know about Somalia, and there’s no way we are going to industrialise unless we get our cost of power down,” said Dr Kiboro.
“This is something that we have to tell our people in government that we really need to address it as a matter of priority.”
Mr Abdulle said Kenya and Somalia have a lot in common, an incentive that should spur trade.
“This trade fair is a reflection of the thriving economic and business relations between Kenya and Somalia, two nations bound by history, culture, and an entrepreneurial spirit that continues to fuel regional prosperity,” said Abdulle.
He, however, called for the diversification of trade by Kenyan companies in Mogadishu.
“As a debt-free nation, Somalia now enjoys renewed international confidence, further strengthened by strategic policies that foster economic growth. Our country boasts rich natural resources; oil, gas, fisheries, and renewable energy, alongside a young, dynamic population eager for progress.”
Garissa Governor Nathif Jamah decried the negative narratives on Somalia and called on the media to help shape a more positive story.
The Kenya-Somalia Trade Week 2025 is a follow-up to the Invest Somalia Conference and Expo 2024 that was also organised by the Nation Media Group in collaboration with Somalia’s Ministry of Planning, Investment and Economic Development and the Somalia Investment Promotion office. It was held in Mogadishu.
This year’s trade fair runs from February 26 to 28. At least 76 exhibitors and companies from different sectors of the economy drawn from Kenya and Somalia are participating.