My Reflections on The Kenya-US FTA

An intense debate has been raging on the proposed Kenya-US Free Trade Agreement. I should commend those who have organised this debate, especially the Uganda branch of the Southern and Eastern African Trade Information and Negotiations Institute (SEATINI). I should also commend several people whose valuable contributions have helped me write this paper.

I have refrained from joining the debate. I have reasons for this to which I will come later.

What does Kenya want out of the FTA?

It is a long list, but the main ones are the following:

  • Export local value-added agricultural products to the US
  • Get US investments – so called foreign direct investments (FDIs)
  • Acquire telecommunication technology and pharmaceutical products from the US
  • Protect key domestic economic sectors from threats of imports

Kenya wants these before AGOA lapses in 2025. [AGOA is the US African Growth and Opportunity Act passed by the US Congress in May 2000]

What does the US want in return?

We all know that President Trump has been pursuing an “America First policy” in its trade negotiations with other countries. For Kenya, it is a long list, but the important ones are the following:

  • A US agreement to supply Kenya with telecommunication technology and pharmaceutical products, but it wants “comprehensive market access” for these products – please note that “comprehensive” is a euphemism for an agreement that keeps the Chinese out of this sector.
  • Export to the US of our Processed agricultural products, such as grains/feeds, soyabeans, livestock products, and horticultural products
  • A discussion re regulations on digital taxes, intellectual property, and corruption in Kenya.

What does the Civil Society want?

Earlier I commended SEATINI and other Civil Society organisations (in Kenya, East Africa, and beyond) as well as some individuals that have made valuable contributions to the debate. I’ll just mention a few.

Professor Uche Ewelukwa Ofodile (who teaches law at the University of Arkansas) has made some very important points, among them:

  • Is full investment liberalization in Kenya’s interest?
  • Caution against illegal acquisition of public lands; illegal dumping of toxic wastes and other forms of environmental pollution; and protection of children from “child labour”.

Lori Wallach (the Director and Founder of Global Trade Watch in the United States) has made good suggestions on how Kenya might negotiate with the US. For example:

  • The FTA should “…be negotiated transparently, replacing the corporate advisory system with an on-the-record public process…”
  • It should “Protect digital privacy by excluding e-commerce rules that shrink the policy space of Congress and U.S. regulators”.

Sanya Reid Smith (Legal Advisor and Senior Researcher at the Third World Network – TWN) has done an excellent technical analysis, on for example:

  • Trade Facilitation;
  • Intellectual Property; and
  • The very contentious issue of  Investor-State Dispute Settlement (ISDS)

SEATINI, as I said, has been one of the driving forces behind the debate. I’ll mention a few of its suggestions:

  • A joint Kenya/US civil society statement to be placed in the media – such as the East African in Kenya – to argue why the FTA with the US is not a good idea and has potential dangers.
  • A webinar between key US members of Congress and Kenyan civil society to discuss some of our concerns.
  • Member to member outreach for US and Kenyan legislators.
  • TWN has done research showing that US FTAs do not attract FDIs. This could be more widely circulated.

My views on the way forward

As I said earlier, I have deliberately refrained from joining the debate.

This is how I see the situation. (You may not agree with me, but we can discuss this later.)

I repeat that many of the above suggestions are excellent. We must try them out – if nothing else than widening our horizons beyond our civil society level. For example, let’s put a joint US-East African statement in the media, and bring together US Congress members with our parliamentarians.

Let me give you my hands-on experience – not as a “professor” but as an activist:

  • 1982-2005: in southern Africa as a grassroots “consultant”.
  • 2005 to 2010: in Geneva as the Executive Director of the South Centre – a “think tank” of the global South initiated by President Julius Nyerere (among others)

Before 1982 I was involved in the struggle against Amin’s military regime in Uganda. He was overthrown in 1979. In 1982, after the collapse of the UNLF Government of which I was a member, I went to Zimbabwe. I had great hopes because I saw Mugabe as a revolutionary.  For some 15 years, instead of joining the university, I went to work with grassroots communities in the rural areas. I worked with spirit mediums in the Zambezi Valley, and with the Zimbabwe National Traditional Healers Association (ZINATHA). I also worked with the Zimbabwe Congress Trade Unions (ZCTU).   

In the early 1990s, Mugabe, pushed by his neo-liberal finance minister, borrowed money from the IMF. As expected, the IMF’s money was conditional:  Zimbabwe had to sign the Economic Structural Adjustment Program (ESAP).  Mugabe capitulated to the dictates of global corporate capital. The spirit mediums in the Zambezi Valley, who had contributed so much to the liberation struggle, were disappointed. So was I. In 1994 I decided to quit working as “rural development consultant,” and turned my energy to fighting the IMF, the World Bank, and the newly created WTO.

It is a long story of struggle. Zimbabwe, with all the resources it has – diamonds, oil, iron ore, vanadium, tin, platinum – is today in a state of anarchy.

Let me wind up.

So yes, let us try all those measures our Civil Society community has suggested – some of which I have listed above. However, please do not get surprised if nothing happens.  I have learnt from experience that it is realpolitik that dictates government actions. For example, you can have our parliamentarians meet members of the US Congress. But the Congress has no power. Effective power resides with the mega-American corporations and the military – the Pentagon.

The situation in Kenya is no different. The richest people are: the Kenyatta family, Naushad Merali, Bhimji Deepak Shah, Nicholas Biwott, Manu Chandaria, Daniel Moi and Family … the list goes on.

I will give an example.

In 2007, the Kenya Small Scale Farmers Forum (KSSFF) filed a case against the Government on the issue of the Economic Partnership Agreement (EPAs) with Europe. In their plaint the Forum argued that it is putting at risk the livelihoods of millions of small farmers. On 30 October, 2013, the High court ruled in the farmer’s favour. Now, 20 years later, the KSSFF is still in the wilderness.

That is realpolitik.

Let me conclude:

  1. Our neo-colonial regimes – not just in Kenya but all over Africa with a few exceptions such as Eritrea – are in cahoots with the Western empire to exploit the poor famers and workers.
  2. Some of our Civil Society members believe that we depend on America. The reality is the exact opposite. It is America that needs our resources – especially now, with the Chinese knocking on the doors with better terms than what the US or the UK can ever offer. I am not in favour of “development aid”, but the Chinese offer long-term finance (unlike the West) and invest in infrastructure development (unlike the West).
  3. But please do not beg. Kenya has enough natural resources to look after its people.  If Trump comes begging on his knees for our resources, let him crawl a bit. If North Korea’s Kim Jong-un can beckon Trump to come to the border between North and South Korea, and Trump takes the next flight out, then why can’t we in Africa.
  4. Learn from Eritrea – a very small country. In 1991, it ended the 30-year war of independence from Ethiopia. It is a member of the International Monetary Fund (IMF) whose economists make annual visits to the country asking Eritrea if it needed finance. But – and this is significant – President Isaias Afwerki refuses to be induced by the IMF. Afwerki  is defiantly independent. Nobody is rich in Eritrea, but nobody goes without meal and the basic necessities of life.

One final word on ideology

Marx, Mao, Keynes and the Neoliberals

Marx taught us that the “Base” (the productive forces of science and technology) determines the “Superstructure” (the state and governance). Mao taught us that in the short run it is possible for the Superstructure to shape the Base. Keynes taught us that governments need to increase state expenditures and lower taxes in order to stimulate demand and pull the global economy out of depression. All three had one thing in common: the relationship between economics, politics and the role of the state. This is contrary to the neoliberal economists who advocate that the state must not interfere with the economy: the private sector and free trade will sort out things by a merry-go-round “laissez faire”.

  • Let the official US-Kenya FTA take us along a merry-go-round “laissez faire” circus.
  • But let us respect our people’s dignity, even if they are poor and we can’t feed them.

28 August, 2020