Kenya has thrown its weight behind a proposal by the United States Administration to extend the African Growth and Opportunity Act (AGOA) for one more year, a temporary but crucial reprieve now awaiting approval by the U.S. Congress.

Prime Cabinet Secretary Musalia Mudavadi, who accompanied President William Ruto to meetings in Washington, D.C., has confirmed that the extension would offer vital breathing space for both governments to craft a more comprehensive and future-ready trade framework.

Taking to X on Friday, December 5, 2025, Mudavadi described Kenya’s position as one grounded in both relief and ambition. Relief, because the lapse of AGOA on September 30, 2025, created uncertainty for exporters in key sectors such as textiles, apparel, and agriculture; and ambition, because Nairobi sees the extension as a stepping stone to a more durable and structured bilateral trade arrangement with the United States.

“Our discussions went further, focusing on the development of a new bilateral trade arrangement that will elevate Kenya–US economic cooperation to the next level. We are working on a joint framework that will open new trade opportunities, strengthen predictability for investors, and build a modern partnership that reflects the ambitions of our two countries,” Mudavadi noted after meeting U.S. Trade Representative Ambassador Jamieson Greer.

Why the one-year extension matters

Kenya has a lot riding on AGOA. In 2024 alone, Kenyan apparel exports to the U.S. under the programme were valued at US$470 million (Ksh60.6 billion), a 19.2 per cent jump from 2023. The sector’s growth has been a major employer, with 66,804 workers employed in AGOA-accredited firms in 2024.

The expiry of AGOA’s preferential tariff regime has, however, exposed Kenya to steep costs. Without the duty-free access, tariffs for some Kenyan products entering the U.S. could rise to nearly 20 per cent, a change that exporters warn could lead to production cuts and job losses.

This is why the proposed one-year extension is seen not just as a technical adjustment, but as a lifeline. It would sustain momentum across value chains built over two decades, buying time for Nairobi and Washington to negotiate a longer-term trade deal.

High-potential sectors for expansion,

Mudavadi further revealed that the two players have identified several high-potential sectors for expansion, including apparel and textiles, agriculture, leather and footwear, chemicals and pharmaceuticals, and ICT and digital services.

”These areas offer substantial opportunities to create jobs, boost export earnings, attract investment, and enhance value chains across Kenya. This renewed engagement sets the stage for a more dynamic, mutually beneficial and future-focused Kenya–US trade relationship,” he added.

Negotiations between Kenya and the U.S. are already pointing toward an expanded framework that prioritises high-potential sectors. The envisioned partnership is expected to include: Agriculture and agro-processing, leather and footwear manufacturing, chemicals and pharmaceuticals and ICT and digital services.

Such diversification would reduce Kenya’s heavy reliance on apparel exports while encouraging value-added production. It would also align Kenya’s industrial aspirations with global trends, including digital innovation and high-skill manufacturing.