New free trade agreement between the EU and Kenya creates growing economic opportunities

New free trade agreement between the EU and Kenya creates growing economic opportunities

According to a report by www.deutschlandfunk.de,

At a ceremony in Nairobi, EU Commission Vice President Dombrovskis and Kenyan President Ruto signed an agreement that will permanently eliminate EU import tariffs for Kenyan goods. In return, Kenya will gradually reduce or eliminate tariffs on goods from the EU. This is the EU's first free trade agreement with an African country since 2016 and is intended to help connect the domestic economy more closely with a high-growth African country and diversify supply chains. Compliance with the Paris Climate Agreement should also be part of the agreement.

As a financial expert, I am analyzing the potential impact of this agreement. The removal of import duties on Kenyan goods in the EU could increase demand for these products, which could lead to an increase in exports from Kenya and thus support the country's economic growth. This could in turn lead to increased investment activity and positive developments on the Kenyan capital market.

On the other hand, reduced or eliminated tariffs on EU goods exported to Kenya could lead to increased competition for local producers. This could lead to market difficulties for Kenyan companies, which will be unable to compete with cheaper competition from the EU.

In addition, the closer economic relations between the EU and Kenya could potentially lead to new investment opportunities for European companies in Kenya and thus also have a positive impact on the EU market.

Overall, the EU-Kenya agreement could have both positive and negative impacts on the financial industry and global trade and should therefore be carefully monitored by investors and companies in both regions.