Government committed to conclude EAC EU EPA negotiations

Led by the Chairman, Mr. Richard Fox the Kenya Flower Council (KFC) met with the Cabinet Secretary Treasury, Mr. Henry Rotich, to discuss the status of the EAC EU economic Partnership Agreement (EPAs). According to Mr. Rotich the government is committed to concluding the negotiations reiterating that failure to sign and ratify the agreement would lead to loss of badly needed jobs and revenue for the country.  Acknowledging that there are about 1-2 % issues outstanding in the current text, where both parties have taken hard lines, the Cabinet Secretary said that the technical and senior officials are working hard to find amicable solutions, which will be tabled and discussed in Nairobi during the Senior Officials meeting scheduled for 24th to 27th March 2014.  This should pave way for a final round, where unlike in the January Brussels Meeting, he will join the Kenya delegation alongside his contemporaries to hopefully seal a deal with their EU counterparts.

The meeting also discussed the VAT Bill 2013 and its impact on exporters, with specific reference to the additional cash flow burden, resulting from payment of VAT on goods previously exempt.  It was noted that compounded with the long outstanding VAT refunds, some companies are owed over Kshs 1 billion, making it very difficult for businesses to survive let alone thrive.

Mr. Rotich explained that together with KRA, they are currently focusing on clearing the existing backlog.  At the same address challenges arising in the implementation of the new VAT Bill, a study of which has already been commissioned.  He invited the industry to participate in the review of resultant proposals once they are tabled at his office.

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