Stronger Kenya-Ethiopia relations good for trade

The opening of the one-stop border post in Moyale marks a major milestone in expanding trade opportunities between Kenya and Ethiopia.

It is the culmination of years of discussions to strengthen trade and other bilateral engagements between the two neighbouring countries, which for geographical and historical reasons, have never optimised their proximity to benefit their citizens.

A single border post eliminates non-tariff barriers that obstruct business and raises operational costs. Moreover, it curbs illegal trade and that is a boon to the governments and the citizens. Besides trade, the opening of this border is a key step in curbing insecurity that is prevalent in the northern region.

In 2012, Kenya and Ethiopia signed a Special Purpose Agreement to enhance bilateral cooperation between them. This comprised improving trade, investment, infrastructure, food security and sustainable livelihoods.

And this easily dovetailed into the Lamu Port-South Sudan-Ethiopia Transport Corridor, a novel integrative infrastructure project conceived in 2009 to transform the region through efficient transport, trade and improved security.

Vibrant service sector

Indeed, the agreement was further solidified by President Uhuru Kenyatta and Ethiopia's Prime Minister Abiy Ahmed in Addis Ababa last year. Among others, Moyale was conceived as a free trade hub that would comprise commercial areas, an industrial park and a vibrant service sector.

Kenya has traditionally traded with its eastern neighbours, Uganda and Tanzania, and while these remain core partners, future prospects rest on extending alliances and reaching out to many others.

Thus, deepening engagement with Ethiopia and South Sudan is quite strategic. Ethiopia, for example, is a fast growing economy with a huge population of more than 100 million people.

It offers ready market for Kenya's products and services. Importantly, when complete, Lamu Port will become Ethiopia's main export and import hub; a windfall for Kenya.

Experience from other parts of the world shows that regional cooperation is the way to go. This, therefore, is an opportune moment for Kenya and Ethiopia to fortify bilateral relations.

This article was originally published by Daily Nation. [Photo: Nation Media Group]