Zero tariffs: Kenya’s trade opportunity in the Chinese market

China’s decision to extend zero-tariff treatment to imports from 53 African countries marks a major shift in Africa-China trade relations.

For Kenya, the Chinese market is now more open, the cost barrier has been reduced, and Kenyan exporters have a stronger opportunity to compete in one of the world’s largest consumer markets.

The policy took effect on May 1, 2026, extending zero-tariff treatment to African countries with diplomatic relations with China.

It builds on China’s earlier duty-free access arrangement, introduced on 1st December 2024 for 33 Least-Developed Countries in Africa, and now extends similar market access to non-LDC economies such as Kenya, Nigeria, Egypt, and South Africa. China has described the move as part of its wider opening-up policy and a measure to deepen China-Africa trade cooperation.

I agree with the remarks of Chinese Ambassador to Kenya Guo Haiyan that in the near term, this policy will substantially raise the competitiveness of African products in the Chinese market, unleash the potential of  trade with China for African countries, and expand the scale and profitability of African exports to China.

In the medium and long term, the ambassador highlights that this policy will encourage more Chinese companies to invest and operate in Africa, support the continent’s industrialization, agricultural modernization and regional integration, better integrate Africa into global industry, supply, and value chains, and further broaden, deepen, and elevate the mutually beneficial China-Africa cooperation.

In short, this policy is a win-win solution and an open chance for Africa to bridge the trade deficit

For Kenya, this development comes at the right time. The 2026 Economic Survey places China’s economy at USD 19.4 trillion, making it the second-largest economy in the world, while Kenya’s GDP stood at about $136 billion in 2025.

Kenya’s domestic economy grew by 4.6 percent in 2025, with GDP reaching Sh17.6 trillion. Agriculture accounted for 23.2% of GDP, industry for 16.3%, and services for 55%.

These figures show that Kenya’s export strength must come from agriculture, agro-processing, light manufacturing, logistics, services, and value-added production.

The trade data makes the case even stronger. In 2025, Kenya’s merchandise exports stood at Sh967.9 billion, while imports reached Sh2.77 trillion, leaving a merchandise trade deficit of  Sh1.65 trillion. China alone accounted for Sh671.2 billion of Kenya’s imports, making it one of Kenya’s largest import sources.

Kenya’s leading export categories were tea at Sh187.1 billion, cut flowers at Sh103.3 billion, vegetables and fruits at Sh99.8 billion, apparel and clothing at Sh63.3 billion, and unroasted coffee at Sh52.1 billion.

Indicating that Kenya already has exportable products, but we must increase scale, improve processing, strengthen market organization, and build more reliable export channels into China.

Kenya-China trade has grown over the years, but it remains heavily imbalanced. More than 97.5 per cent of that trade was imports from China.

This imbalance must now be addressed by strengthening Kenyan exports through a structural change in the relationship. Kenya must move from being mainly a buyer of Chinese goods to becoming a competitive supplier of quality products to the Chinese market.

The history of Kenya’s market access journey shows that progress is possible. In January 2022, Kenya and China signed protocols that opened the way for Kenyan fresh avocados to enter the Chinese market.

In August 2022, Kenya became the first African country to export fresh avocados to China. That achievement required phytosanitary compliance, product inspection, certification, cold-chain readiness, and coordination between public and private institutions.

Kenyan coffee, tea, macadamia nuts, flowers, leather products, mangoes, French beans, minerals, textiles, and avocado oil can all benefit from better access to China. Currently, China is the 2nd largest buyer of Kenya’s tea, and the move will surely increase the volume and value of Kenya’s tea exports.

There is an immense opportunity if/when the largest producer and importer of tea and the highest exporter of tea come into partnership. Chinese authorities have also pointed to Kenyan coffee and avocados as products that can gain a competitive edge under the zero-tariff framework, especially where previous tariff rates (8%-30%) affected final market prices.

We need to use this moment to increase value addition. Tea should move beyond bulk export into branded Kenyan tea products. Coffee should move beyond green beans into roasted, packaged, and traceable premium coffee.

Macadamia should move into processed snacks, oils, and ingredients. Leather should move into finished bags, footwear and accessories. Avocado should move into oil, cosmetics, food ingredients, and packaged consumer products.

KNCCI is already supporting this transition. In the last two years, we have facilitated over Sh765 million in exports across macadamia, avocado, coffee, tea, leather and avocado oil. We are working with our members to aggregate supply, improve quality, ensure competitive pricing and meet international market standards.

Export success in China will depend on consistency.

A buyer in Shanghai, Guangzhou, or Beijing must know that Kenyan suppliers can deliver the right quality, quantity and documentation every time.

Trade finance must also move with the opportunity. Exporters need working capital, cold-chain financing, shipment financing, processing equipment financing, insurance and buyer verification support.

KNCCI has engaged financial institutions, including Stanbic, DTB, development banks, and others, to push for tailored trade finance products that respond to the needs of Kenyan exporters.

Since its opening in December 2023, our KNCCI China Office has participated in more than 65 business events and connected 350 Kenyan businesses with 700 Chinese buyers and investors.

It has supported investment promotion, with more than 8 Chinese companies committing over Sh3 billion across sectors such as textiles, energy, healthcare, manufacturing, aquaculture, logistics and e-commerce.

The office also continues to provide practical market intelligence on demand, pricing, logistics, certification, buyer expectations, and focused capacity-building programmes. 140 avocado exporters have been trained on China procedures, 85 macadamia exporters on pricing and quality, and 90 coffee exporters on market demand.

The Zero Tariff agreement presents an opportunity for Chinese firms seeking reliable African production bases to view Kenya as a serious partner for agro-processing, textiles, healthcare, aquaculture, logistics, e-commerce and manufacturing.

The priority must be investment that creates local jobs, transfers technology, strengthens SMEs, expands Kenya’s export capacity, and attracts the capital, technology and market linkages needed to produce more competitively at home.

I call upon farmers to organize into export clusters, SMEs to formalize and meet documentation standards, processors to invest in quality systems, banks to design products for exporters, county governments to support aggregation and production zones and national agencies to speed up certification and market-access procedures.

KNCCI’s position is to encourage exporters and investors to maximize this opportunity and grow exports, strengthen value addition, raise farmer incomes, support SMEs and attract productive investment.

 

by ERICK RUTTO

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