Kenya is set to continue benefiting from duty-free access to the United States market until December 31, 2028, following the US Senate's approval of the extension of the Africa Growth and Opportunities Act (AGOA).

The Ministry of Trade confirmed that this extension will safeguard duty-free entry for eligible Kenyan exports, alongside other Sub-Saharan African countries, once the approval process is fully completed.

Boost for Kenya's Apparel Sector

Trade Cabinet Secretary Lee Kinyanjui highlighted the extension's importance in providing certainty for manufacturers, especially in the apparel sector, which constitutes approximately 70% of Kenya's exports to the US.

A key provision protecting Kenya's apparel industry is the continuation of the third-country fabric rule. This allows firms operating within Export Processing Zones (EPZs) to source raw materials such as yarns and fabrics from outside AGOA countries, add value locally, and export finished garments duty-free.

Financial Relief for Exporters

The Ministry welcomed a clause enabling exporters to claim refunds for eligible duties paid during the gap between the previous AGOA expiry on September 30, 2025, and the enactment of the new extension. Exporters will not incur penalties for shipments made during this period.

The government is coordinating with US Customs and Border Protection to ensure timely processing of these refunds within the mandated 90-day window.

Economic Impact and Future Prospects

  • Kenya remains the largest AGOA beneficiary in the garment sector, with textile and apparel exports valued at Sh60.6 billion (about $470 million) in 2024, marking a 19% increase from 2023.
  • The apparel industry supports over 66,000 direct jobs in Kenya.
  • AGOA also benefits Kenya's agricultural exports including cut flowers, tea, coffee, and macadamia nuts, all enjoying duty-free access to the US.
  • The extension aligns with Kenya's industrialization goals, encouraging manufacturers to expand capacity and diversify exports across more than 6,000 product lines.

Cabinet Secretary Kinyanjui emphasized ongoing engagement with the US government to foster mutually beneficial trade and investment relations. He urged Kenyan businesses to ramp up production and investment to fully exploit preferential access to the world's largest consumer market.