Beyond Duty-Free Access: How Ruto’s EU Trade Push Aims to Reshape Kenya’s Export Economy and the Obstacles Standing in the Way

When President William Ruto met with EU Ambassador to Kenya Henriette Geiger at State House on February 24, 2026, the setting was familiar but the stakes were higher than ever. The two sides have been deepening a commercial relationship that, measured in raw trade volumes, already makes the European Union Kenya’s most important export market by a wide margin. What the meeting underscored was that Kenya’s government intends to do something more difficult than simply maintaining that relationship — it intends to transform it.

“Kenya and the European Union share a strong, long-standing partnership that has grown steadily over the years, making the EU our largest export market,” Ruto said after the talks, pointing to the EU-Kenya Economic Partnership Agreement that came into force in July 2024 as the central instrument of that ambition. The administration, he said, was focused on ensuring that Kenyan businesses — from smallholder farmers to industrial exporters — fully benefit from a deal that guarantees duty-free, quota-free access to one of the world’s most lucrative consumer markets.

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“Our goal is to expand global markets for our farmers, entrepreneurs and industries, increasing earnings, creating jobs and delivering tangible economic and social gains for Kenyans,” Ruto told reporters after the meeting, emphasising that expanding export opportunities is central to the country’s broader economic strategy.

The EPA: What Kenya Signed, and What It Means

The EPA between Kenya and the European Union represents a landmark in African trade diplomacy. Negotiations concluded in June 2023; the agreement was formally signed on December 18, 2023 in Nairobi, in a ceremony attended by Ruto and European Commission President Ursula von der Leyen. The European Parliament gave its consent in February 2024, and the deal entered into force on July 1, 2024 — making it the first fully operational trade agreement between the EU and an East African Community (EAC) country.

The terms are deliberately asymmetric, reflecting Kenya’s status as a developing economy. The EU immediately and permanently eliminated all tariffs and quotas on Kenyan goods — every product except arms and ammunition enters the EU market duty-free from day one. Kenya, by contrast, has committed to liberalise only 82.6% of imports from the EU, spread over a phase-in period of up to 25 years, with sensitive agricultural and manufacturing sectors protected from tariff reductions. The arrangement explicitly includes safeguards for agriculture, food security, and infant industries.

What the EU describes as the agreement’s most distinctive feature is its sustainability framework. The EPA is the most ambitious trade deal the EU has ever signed with a developing country when it comes to provisions on climate and environmental protection, labour rights, and gender equality. It includes binding and enforceable commitments on workers’ rights, a requirement to implement the Paris Agreement on climate change, provisions to combat illegal wildlife trade, illegal logging, and illegal fishing, and a dedicated chapter on economic and development cooperation designed to strengthen the competitiveness of the Kenyan economy.

The EPA is also deliberately open-ended. The agreement remains open for other EAC partner states — including Tanzania, Uganda, Rwanda, Burundi, South Sudan, Somalia, and the Democratic Republic of the Congo — to join, positioning Kenya as a potential regional gateway for EU market access.

What Kenya Actually Exports to Europe — and How Big the Stakes Are

The EU absorbs a dominant share of Kenya’s agricultural output. Total EU agri-food imports from Kenya reached €1.237 billion in 2024, up 10.3% year-on-year — the highest level on record. Horticulture is the single largest category at €501 million, followed by coffee, tea, and spices at €203 million, and fruits and nuts at €216 million. Across all goods, total bilateral EU-Kenya trade stood at €3.3 billion in 2022, an increase of 27% compared to 2018 — a figure that has risen further since the EPA took effect.

Flowers are central to this story. Kenya is the world’s second-largest cut-flower exporter, supplying approximately 40% of all roses traded in the EU. The sector generated $835 million in export earnings in 2024, according to the Kenya Flower Council, with forecasts pointing to $851 million in 2025 — driven by Valentine’s Day demand and a recovering export season. Lake Naivasha, situated above 1,800 metres, accounts for the majority of Kenya’s floriculture output; roses alone make up 66% of Kenya’s floriculture market.

The avocado sector has emerged as one of the fastest-growing components of Kenya’s EU export portfolio. Kenya earned $159 million from avocado exports in 2024 — an 11% increase year-on-year — with the Netherlands absorbing 32% of those shipments. Post-forecasts by the USDA project avocado export values rising to $175 million in 2025, supported by expanded cultivation areas projected to reach 34,000 hectares and growing demand across European retail chains. Approximately 70% of Kenya’s 966,000 avocado farmers are smallholders managing between ten and twenty trees per homestead — meaning the avocado boom has broad rural welfare implications.

Tea and coffee complete the picture. Horticulture as a whole — comprising fruits, vegetables, and flowers — earned KES 71.8 billion from EU exports in 2024, with the EU accounting for approximately 45% of Kenya’s total horticultural export destination. Agriculture contributes over 20% of Kenya’s GDP, employs more than 40% of the population, and accounts for 65% of the country’s export earnings — making European market access a matter of macroeconomic importance, not just sector-level policy.

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The Compliance Challenge: Phytosanitary Standards and Non-Tariff Barriers

The EPA eliminates tariffs, but it does not eliminate the compliance burden that Kenyan exporters must meet to access the European market — and in some cases, that burden has grown heavier, not lighter.

Fresh vegetable exports to the EU plunged by more than half in 2024, falling from KES 50.9 billion in 2023 to KES 23.4 billion, primarily due to tighter EU pesticide residue rules. The EU’s enforcement of Maximum Residue Limits (MRLs) for pesticides is among the most stringent in the world, and Kenya’s flower sector suffered significant losses from intercepted consignments under the EU’s False Codling Moth regulations, which target a pest that can contaminate rose shipments. Challenges including phytosanitary controls, labelling, packaging, and environmental safety compliance have historically constrained exporters, particularly those dealing in vegetables, fruits, and flowers.

Agriculture Cabinet Secretary Mutahi Kagwe has acknowledged the tension between the EU’s legitimate regulatory goals and the compliance cost burden on Kenyan farmers. Kenya has now banned more than 200 pesticides that fail to meet global standards and is working with regional partners to harmonise sanitary and phytosanitary measures across COMESA. The EPA’s dedicated SPS chapter commits both sides to promoting harmonisation of standards with international norms and to EU development assistance supporting farmers’ capacity to comply — but the practical gap between the EU’s requirements and what smallholders can routinely deliver remains a structural challenge.

One reason for optimism is Kenya’s designation as a low-deforestation risk country by the European Union — a classification that benefits exports of tea, coffee, and cut flowers by reducing the compliance burden under the EU Deforestation Regulation, which entered into force alongside other aspects of European green trade policy. The Kenya Plant Health Inspectorate Service (KEPHIS) has also reported significant improvement in flower inspection outcomes, with interceptions at EU borders falling sharply in recent months. The state-run Horticultural Crops Directorate certified 1.8 million metric tonnes of produce in 2024, supporting 1.2 million smallholders, and conducted 3,200 capacity-building sessions attended by 85,000 farmers.

Climate Finance, CBAM, and Kenya’s Green Competitive Edge

A major subtext of the Ruto-Geiger meeting was climate. The EU’s Carbon Border Adjustment Mechanism entered its definitive phase on January 1, 2026, becoming the world’s first fully operational border carbon price. CBAM currently covers cement, iron, steel, aluminium, fertilisers, electricity, and hydrogen — sectors that are not Kenya’s primary EU export categories today. But the mechanism is set to extend its scope to additional ETS-covered sectors and downstream goods from 2026 onwards, and its full enforcement signals the direction of travel: carbon-intensive manufacturing will face higher costs to access the EU market.

Kenya’s heavy reliance on renewable energy — geothermal, hydro, solar, and wind collectively supply the majority of the country’s electricity — gives it a distinctive competitive advantage in a world where carbon content increasingly determines market access. Manufacturing in Kenya carries a naturally lower carbon footprint than equivalent production in many other developing countries that rely on coal or heavy fuel oil for power. As the government accelerates efforts to attract EU foreign direct investment into local manufacturing capacity, that clean energy endowment is a commercial asset, not merely an environmental one.

Kenya’s ambition under CBAM is to position itself as what government officials call a “green manufacturing hub” — a base from which to supply carbon-sensitive European supply chains with goods that carry credible low-emissions credentials. The EPA’s sustainability chapter, including its binding Paris Agreement commitment, reinforces this positioning and signals to European institutional investors that Kenya is aligning its regulatory environment with green transition requirements.

Diversification Beyond the EU: Leveraging European Standards to Open New Markets

Ruto was clear that the EU relationship, while central, is not the ceiling of Kenya’s trade ambitions. The administration views the discipline required to access the European market — GlobalGAP certification, phytosanitary compliance, traceability systems, carbon reporting — as a springboard for penetrating other premium markets in North America, the Middle East, and Asia.

Kenya signed a Comprehensive Economic Partnership Agreement with the UAE in January 2025, which simplifies sanitary and phytosanitary protocols for cut flowers and fruits entering Gulf markets. The Netherlands, already the single largest destination for Kenyan avocados at 32% of exports, is also the primary re-export hub for Kenyan flowers into wider Europe. Cold-chain investments across key growing regions — particularly in avocado-producing counties such as Murang’a and Kisii — are reducing the post-harvest spoilage losses that have historically affected 30–40% of perishable produce, while expanding the range of markets that Kenyan exporters can realistically serve.

The World Bank has noted in its Kenya Economic Update that exports to the EU have remained concentrated on the same basket of products — flowers, coffee, tea, avocados, and green beans — for more than two decades. This concentration limits resilience to commodity price swings, regulatory changes, and competition from countries such as Colombia and Ecuador in the flower market. Value-added agro-processing — converting raw avocados into avocado oil, processing coffee into specialty roasts, or producing semi-finished horticultural goods — is increasingly seen as the route to both higher export earnings and reduced reliance on a narrow export base.

What the EPA Means for Kenya’s Long-Term Economic Trajectory

The EU-Kenya EPA is not merely a trade deal. It is the framework through which Kenya intends to industrialise, formalise, and green its agricultural supply chains — and to attract the European investment capital that would accelerate that transformation.

According to the EU, the agreement provides a platform to support job creation on both sides, with targeted cooperation to enhance Kenya’s economic development. EU development assistance channelled through trade capacity-building measures is explicitly designed to support farming and rural employment, and to build farmers’ ability to comply with agricultural standards that increasingly define whether they can participate in global supply chains at all.

President Ruto’s framing of the moment captures the strategy in its simplest form: “The core of this arrangement is to put real money into the pockets of ordinary people.” Reaching that goal requires more than preserving the trade volumes already flowing — it requires turning the EPA’s architecture of standards, sustainability commitments, and development cooperation into a ladder that Kenya’s farmers and manufacturers can actually climb.

Kenya’s exports to the EU hit KES 450 billion in 2023, and are rising. The question that President Ruto and Ambassador Geiger were addressing on February 24, 2026 is whether they can rise faster, in more product categories, through more value-added processing, and with lower barriers for the smallholder farmers who grow the goods — and whether Kenya can use Europe’s stringent standards not as a barrier but as an engine.

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By: Montel Kamau

Serrari Financial Analyst

25th February, 2026