An American government trade report has highlighted persistent barriers in Kenya pointing to why President Donald Trump imposed a 10 per cent reciprocal tariff on the East African nation.
The recently released 2025 National Trade Estimate Report on Foreign Trade Barriers by the United States Trade Representative (USTR) puts a spotlight on several key issues in Kenya’s trade and investment environment that could complicate the country’s efforts to boost exports and attract foreign direct investment.
The findings are particularly relevant at a time when Kenya is positioning itself as a regional trade and technology hub through initiatives like the African Continental Free Trade Area (AfCFTA) and its deepening strategic partnerships with the U.S., EU, and Asian economies.
Key Concerns Raised in the Report
According to the report, “Kenya continues to maintain restrictive policies” that affect market access for U.S. goods and services, especially in areas such as agriculture, ICT, and intellectual property.
The report goes ahead to list the most pressing concerns:
Agricultural Imports: Kenya imposes a variety of tariffs and non-tariff barriers, particularly in agriculture, including unclear import permit systems, testing requirements, and restricted biotechnology use. These pose significant obstacles for U.S. exports of genetically engineered (GE) products such as corn and soybeans.
ICT and Digital Trade: Kenya’s Data Protection Act and the implementation of data localization rules are flagged for creating “barriers to digital trade”, especially for cross-border data transfers. This is crucial as Kenya seeks to become a tech leader in Africa but risks deterring investment from U.S.-based cloud service providers and tech firms due to ambiguous or restrictive policies.
Intellectual Property Rights (IPR): Despite recent reforms, the report notes “persistent weaknesses in enforcement”, especially for counterfeit goods and piracy. For a country marketing itself as an innovation hub, these gaps could undercut confidence among U.S. and other foreign investors in sectors like software, pharmaceuticals, and entertainment.
Government Procurement: Kenya is not a party to the WTO Agreement on Government Procurement, and the USTR points to “concerns about transparency and fairness” in awarding public tenders. This could complicate access for U.S. firms in infrastructure and energy sectors, where Kenya is aggressively seeking investment.
Implications for Kenya’s Trade Strategy
While the USTR report does not directly threaten Kenya’s trade ties with the U.S., it serves as a “reminder that non-tariff and regulatory barriers remain a major concern”.
Kenya’s 2024 push to finalize the Strategic Trade and Investment Partnership (STIP) with the U.S. could be influenced by these critiques, as Washington may seek concrete reforms before any binding deal is concluded.
Moreover, as Kenya eyes expanded trade within the AfCFTA and with Europe and Asia, aligning its domestic trade policies with global standards—particularly in digital trade, IPR enforcement, and customs efficiency—will be essential for credibility and competitiveness.
The report isn’t entirely bleak. It acknowledges progress Kenya has made in areas such as “developing its IP framework”, improving port infrastructure, and engaging with trading partners on harmonizing standards. These areas present “clear opportunities for reform and bilateral collaboration”.
If Kenya addresses some of these barriers—especially in data governance, transparent procurement, and biotechnology regulation—it could unlock not only better access to U.S. markets but also strengthen its position as a “gateway to East and Central Africa” for global investors.
