ECONOMY Kenya and Ethiopia Sign 5 Agreements to Boost Trade
Monday, April 21, 2025 at 1:58 PM
By Bonface Kanyamwaya reviewed by Mercy Nyambura
Kenya and Ethiopia have signed new deals to strengthen cross-border trade between the two nations
The deals were signed in Mombasa last week by Kenya’s Trade Cabinet Secretary Lee Kinyanjui and his Ethiopian counterpart, Kassahun Gofe
The move signals a renewed push to streamline bottlenecks that are hampering trade growth between the two African nations
Bonface Kanyamwaya, a journalist at TUKO.co.ke, has more than 10 years of financial, economic, business, markets, and aviation expertise, providing insights into Kenya and global trends.
Kenya and Ethiopia have struck new deals to grow and strengthen trade between their border
Ethiopia’s Minister of Trade and Regional Integration Kassahun Gofe (l) with Kenya’s Trade and Investment Cabinet Secretary Lee Kinyanjui (r) speak to the media last week. Photo: Lee Kinyanjui.
Source: Twitter
The deals were signed by Kenya’s Trade Cabinet Secretary Lee Kinyanjui and his Ethiopian counterpart Kassahun Gofe last week.
The signing took place after talks between the two leaders in Mombasa.
“The meeting considered the key outstanding issues which include: area of border trade, trading threshold, travel frequency, and the common list of products,” said a joint communique released by the two leaders which was seen by TUKO.co.ke.
Deals signed between Kenya and Ethiopia
Among the areas of agreement signed by the trader leaders are new trade zones, which will allow small-scale traders to exchange goods worth up to $ 1,000 (KSh 129,000) upto four times per month without restrictions.
They also agreed on the list of products to enhance trade and cut the free flow of goods across the border, a factor that has been hindering trade between the two countries.
Products traded in Kenya and Ethiopia
The list of products agreed upon was not immediately disclosed in the joint communication.
However, the list of goods that were initially agreed upon for trade between the two countries includes machinery, plastics, motor vehicles parts and textile.
During the meeting, which was held at a Mombasa hotel, the two leaders mutually agreed to expand cross-border trade zones to allow businesses in Kenya and Ethiopia to trade smoothly.
In Kenya, the trade zone has extended 100 kilometers while in Ethiopia, the trade zone has extended to 50 kilometers from the boarder.
The meeting further agreed on the collaboration on the implementation of the African Continental Free Trade Area.
Both parties agreed to draw a memorandum of understanding to fast-track the implementation of the African Continental Free Trade Area between Kenya and Ethiopia.
“The Ethiopian side agreed to initiate and exchange the draft instruments,” said the joint communication.
The AfCFTA is the world’s largest free trade area, bringing together the 55 countries in the African Union (AU) and eight regional economic communities to create a single market for the continent.
Trade and Investment CS Lee Kinyanjui speaks at the event in Mombasa last week. Photo: Lee Kinyanjui
Source: Twitter
Kenya Power inks electricity deal with Ethiopia
Back in 2022, Kenya Power and Lighting Company (KPLC) signed a 25-year agreement with Ethiopian Electric Power (EEP) to import electricity from the country.
Under the deal, Kenya was to purchase 200 megawatts(MW) of electricity from Ethiopia in the first three years.
The capacity was to be doubled to 400 megawatts for the remaining 22 years.
Proofreading by Mercy Nyambura, copy editor at TUKO.co.ke.
Source: TUKO.co.ke