At first glance, the January-June trade figures between China and Kenya look promising. Kenyan exports increased by 74% during this period while imports fell by 16%. Officials on both sides are no doubt pleased the numbers are finally going in the right direction to help narrow the huge trade imbalance.

Key Take-Aways from the H1 2019 China-Kenya Trade Data

• Analysts don’t believe that structural changes in the Kenyan economy are helping to remedy the trade balance. Instead, imports are decreasing largely because of reduced demand for industrial machinery for the recently-completed Phase 2 of the SGR construction.

• The dramatic increase in Kenyan exports to China is largely due to agricultural products including specialty teas, coffee, and avocados. It will be difficult for Kenya to reduce the trade deficit on commodity unless it either adds value to those products before export or begins to ship higher value commodities like oil.

Read the full report on the Business Daily website.