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Corona virus to hurt Kenya-China trade

BY CYNTHIA ILAKO

Suspension of flights to China over the widespread of Corona Virus in the Asian state may slice Kenya’s export receipts, hurting the country’s economic growth.

Avocado farming Image: FILE

On January 30, Kenya Airways bowed to pressure, suspending all its flights to Guangzhou, China, to avoid spread of the disease to the country.

Coffee, specialty tea, cut flowers and avocados are some of the items beginning to gain traction in the Chinese market, majority of which are perishable goods meaning they are hauled by air.

“We have had to cut exports on our end and this will definitely affect the country’s foreign inflows,” Nairobi Importers and Small Traders Association chairman Samuel Karanja told the Star.

He added that traders (both importers and exporters) were staring at grim days ahead due to the deadly virus.

“Most of us get goods from China, which we can’t do now,” he said. “ On the other hand exporters must now look for an alternative market which is not an easy feat.”  

So far the virus has killed more than 1,100 people, with more than 45,000 individuals infected worldwide. The vast majority of cases are in mainland China.

Prior to the outbreak of the respiratory disease, which the World Health Organisation has declared a global health emergency, orders for Kenyan goods to China had been on an upward trajectory.

Data by the Kenya National Bureau of Statistics show China bought goods worth 7.48 billion during the first half of 2019, a 74.13 per cent jump compared to the previous year.

This was largely attributed to aggressive trade promotion and marketing campaigns in China by the Kenya Export Promotion and Branding Agency, which aims at growing the market for Kenyan farm produce.

In 2018, Kenya exported goods valued at Sh11.2 billion to China while importing goods worth Sh370.83 billion, showing a massive trade gap between the two states despite increased dealings.

Karanja says, the deadly virus is now hindering importers who bring in consolidated goods will not be able to do so until the coast is clear. 

While this could mean less outflows to China, importers are likely to heighten prices trying to meet their margins in the coming months. 

“Importers who door-to-door shopping in China haven’t been able to do so. We will feel the pinch and we are likely to see some commodity prices go up,” he said. 

Source: The Star

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