Kenya-UAE Trade Soars to Historic Sh445 Billion as Landmark Partnership Unlocks Unprecedented Economic Opportunities

The cooperation between Kenya and the United Arab Emirates has reached unprecedented heights with the signing of the landmark Comprehensive Economic Partnership Agreement (CEPA) in January 2025, setting the stage for the highly anticipated visit of UAE ruler Sheikh Mohammed bin Zayed Al Nahyan scheduled before December 2025. This transformative partnership has already propelled bilateral trade to a remarkable Sh445 billion ($3.4 billion) in 2023, establishing the UAE as Kenya’s third-largest trading partner globally and top partner in the Gulf region.

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The CEPA represents a historic milestone as the first agreement of its kind signed by the UAE with a mainland African country, fundamentally reshaping economic relations between the Middle East and East Africa. President William Ruto and His Highness Sheikh Mohamed bin Zayed Al Nahyan presided over the agreement signing at Qasr Al Bahr in Abu Dhabi, marking a transformative step in enhancing trade, investment, and economic cooperation that extends far beyond traditional trade relationships.

Trade between the two countries has more than doubled over the past decade, with the UAE now ranking as Kenya’s sixth-largest export destination and second-largest source of imports, accounting for 16% of Kenya’s total imports. This remarkable growth trajectory reflects the deepening economic integration and mutual recognition of strategic opportunities that extend across multiple sectors and value chains.

CEPA: Beyond Traditional Trade Boundaries

The Comprehensive Economic Partnership Agreement transcends conventional trade arrangements by addressing services, technological innovation, digital trade, and sustainability in a comprehensive framework. The agreement eliminates tariffs on over 80% of traded goods between the two countries, with Kenya targeting a 40% increase in exports to the UAE within five years—a goal that appears increasingly achievable given current momentum.

President Ruto emphasized the transformative potential during the signing ceremony: “The CEPA will unlock opportunities for our businesses and create jobs for our youth while positioning Kenya as the gateway to East Africa.” This strategic positioning aligns perfectly with Kenya’s Bottom-Up Economic Transformation Agenda (BETA), which prioritizes inclusive growth and sustainable development across all economic sectors.

The agreement opens new opportunities for Kenyan service providers in education, transport, communications, construction, and engineering to access the UAE market, while providing UAE businesses with investment opportunities in critical Kenyan sectors including energy, water, agriculture, health, ports, airports, logistics, human resource development, and ICT.

Agricultural Exports: A Growth Engine

Kenya’s agricultural sector stands to benefit dramatically from the CEPA implementation, with government projections indicating potential tripling of key agricultural exports. In 2023, Kenya exported Sh9.9 billion worth of meat and Sh10.8 billion in fruits and vegetables to the UAE, representing substantial market shares that are positioned for exponential growth.

The UAE has become a crucial destination for Kenya’s premium agricultural products, with meat exports reaching Sh9.9 billion in 2023, representing more than half of Kenya’s total meat exports. Additionally, fruit exports—including pineapples, avocados, and mangoes—generated Sh5.2 billion, while vegetables and flowers contributed Sh5.6 billion to the bilateral trade portfolio.

Government spokesperson Dr. Isaac Mwaura highlighted the agreement’s potential: “This agreement is expected to double these figures by eliminating trade barriers and simplifying customs processes.” The removal of tariff and non-tariff barriers creates a robust free trade environment that particularly benefits Kenya’s competitive agricultural sector, positioning the country to capitalize on growing Middle Eastern demand for high-quality food products.

Sanjeev Gadhia, CEO of Astral Aviation, emphasized the logistics benefits: “By boosting the export of Kenyan perishable goods like flowers, fruits, and vegetables to the UAE, it will likely open up more opportunities for Kenyan farmers and exporters while enhancing the UAE’s access to fresh, high-quality products.”

Technology and Innovation Partnerships

The CEPA framework recognizes the critical importance of technology transfer and innovation in driving long-term economic transformation. Kenya has emerged as a global leader in startup funding, attracting $638 million in 2024, representing 29% of Africa’s total startup funding, according to The Big Deal Africa. This success is underpinned by innovative government initiatives such as the Digital Superhighway program under the BETA plan.

The UAE’s investment opportunities in Kenya’s ICT sector align with the country’s digital transformation agenda, which includes a Sh53 billion digital infrastructure investment program designed to connect every corner of the country. Kenya’s startup ecosystem captured 32% of Africa’s funding in the first half of 2024, fueling job creation and driving innovation across sectors like fintech, climate tech, and digital services.

The partnership extends to broader technological cooperation, with both countries committing to promote clean technologies and environmentally responsible practices. This sustainability focus ensures that economic growth is achieved responsibly while benefiting future generations through green technology adoption and environmental stewardship.

Infrastructure Development and Regional Connectivity

One of the most ambitious aspects of the Kenya-UAE partnership involves infrastructure development, particularly President Ruto’s announcement of UAE involvement in extending Kenya’s Standard Gauge Railway to Uganda and South Sudan. This collaboration could play a pivotal role in advancing regional connectivity and positioning Kenya as the definitive gateway to East and Southern Africa.

The infrastructure component aligns with the UAE’s role as a global logistics and financial hub connecting the Middle East, Asia, and beyond. The partnership creates opportunities for large-scale infrastructure projects that enhance regional connectivity while supporting Kenya’s position as a transport and logistics hub for the broader East African region.

Dr. Thani bin Ahmed Al Zeyoudi, UAE Minister of State for Foreign Trade, emphasized the strategic importance: “The UAE fosters economic growth through stronger open trade and investment policies. The country’s business community is expected to reap further commercial and investment benefits from these agreements.”

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Financial Services and Investment Flows

The CEPA framework significantly enhances opportunities for financial services cooperation and investment flows between the two countries. Kenya’s rapidly growing financial services sector, characterized by innovations in mobile banking and fintech, offers substantial opportunities for UAE investors seeking exposure to Africa’s most dynamic financial markets.

The UAE’s position as a global financial hub provides Kenyan businesses with enhanced access to international capital markets and sophisticated financial services. This bilateral financial cooperation supports the broader goal of positioning Kenya as a regional financial center while leveraging UAE expertise in Islamic finance and wealth management.

The agreement includes provisions for protecting and promoting investments, requiring commercial presence for foreign service providers to establish local operations. This approach aims to increase productivity, improve infrastructure, and enhance access to essential services while creating employment opportunities and facilitating technology transfer.

Regional Integration and Global Market Access

The Kenya-UAE CEPA complements Kenya’s broader trade strategy, which includes key agreements such as the African Continental Free Trade Area (AfCFTA), the Kenya-EU Economic Partnership Agreement, the Kenya-UK Economic Partnership Agreement, and the African Growth and Opportunity Act (AGOA) with the United States.

This comprehensive network of trade agreements positions Kenya as a gateway to global markets representing nearly half of the world’s GDP. The strategic positioning enhances Kenya’s attractiveness as an investment destination while providing Kenyan businesses with unprecedented market access across multiple continents.

Alfred K’ombudo, Kenya’s Principal Secretary for Trade, described the CEPA as “a historic milestone in Kenya-UAE trade relations,” emphasizing its potential to foster trade, enhance investment capabilities, and promote collaboration in logistics and trade in services.

Energy Sector Collaboration and Sustainability

The partnership recognizes the critical importance of energy sector cooperation, particularly in renewable energy development where both countries have demonstrated leadership. Kenya has established itself as a regional leader in clean energy development, with approximately 90% of its on-grid electricity coming from renewable sources.

The UAE’s expertise in energy infrastructure and renewable energy technologies, combined with Kenya’s abundant renewable energy potential, creates opportunities for large-scale collaborative projects in solar, wind, and geothermal energy development. These partnerships support both countries’ commitments to sustainability and climate change mitigation while creating new economic opportunities.

The energy cooperation extends to traditional sectors as well, with UAE petroleum products representing a significant component of bilateral trade. The partnership framework provides opportunities for enhanced cooperation in energy infrastructure development, including ports, airports, and logistics facilities that support energy trade.

Tourism and Cultural Exchange

The CEPA framework enhances opportunities for tourism cooperation between the two countries, building on existing cultural and business connections. The UAE’s position as a global aviation hub and Kenya’s status as a premier safari and beach destination create natural synergies for tourism cooperation and promotion.

The UAE’s focus on key sectors including tourism aligns with Kenya’s tourism sector development goals, creating opportunities for joint marketing initiatives, infrastructure development, and service standards enhancement. The partnership supports both countries’ goals of diversifying their tourism markets while enhancing visitor experiences.

Manufacturing and Industrial Development

The CEPA creates significant opportunities for manufacturing sector cooperation, particularly in areas where Kenya has demonstrated competitive advantages. Kenya’s manufacturing sector, supported by preferential access to US markets under AGOA, benefits from enhanced access to UAE markets and investment flows.

The agreement’s focus on promoting industrialization and regional value chains supports Kenya’s manufacturing sector development goals while providing UAE businesses with access to Kenya’s skilled workforce and strategic location. The partnership facilitates technology transfer and skills development that enhance manufacturing competitiveness across multiple sectors.

The agreement provides duty-free and quota-free access for Kenyan manufactured goods to UAE markets, enhancing the competitiveness of Kenyan products while encouraging industrial development and job creation.

Future Prospects and Implementation Timeline

The upcoming visit of UAE ruler Sheikh Mohammed bin Zayed Al Nahyan before December 2025 represents a crucial milestone in implementing and expanding the partnership. This high-level engagement will cement additional trade deals worth billions of shillings while enhancing work relations between the two countries.

The implementation of the CEPA involves technical working committees established to undertake detailed consultations on fourteen key areas, including intellectual property rights, digital trade, and sustainable development. These committees ensure that the agreement’s implementation addresses practical challenges while maximizing opportunities for both countries.

Dr. Mwaura highlighted that the CEPA provides the UAE with investment opportunities in critical sectors while aligning with Kenya’s strategy to reduce borrowing through enhanced public-private partnerships and foreign direct investments.

Economic Impact and Transformation Goals

The CEPA’s economic impact extends beyond immediate trade benefits to support broader transformation goals in both countries. For Kenya, the agreement supports the Bottom-Up Economic Transformation Agenda by unlocking new markets for priority value chains, attracting foreign direct investment, and promoting technology transfer.

For the UAE, the partnership advances its CEPA program goals of elevating non-oil foreign trade to AED4 trillion ($1.1 trillion) by 2031 while strengthening its position as a global trade hub connecting high-growth economies across multiple regions.

The partnership creates a foundation for sustained economic growth that benefits both countries while contributing to broader regional development goals in East Africa and the Middle East.

Conclusion: A Model for South-South Cooperation

The Kenya-UAE Comprehensive Economic Partnership Agreement represents more than a bilateral trade arrangement—it exemplifies successful South-South cooperation that creates mutual benefits while supporting broader development goals. The partnership’s comprehensive scope, from agriculture and manufacturing to technology and sustainability, demonstrates the potential for emerging economies to create transformative economic relationships.

The achievement of Sh445 billion in bilateral trade, coupled with the ambitious expansion goals enabled by the CEPA, positions this partnership as a model for other African countries seeking to diversify their economic relationships and enhance their global market access.

As Kenya continues leveraging its position as the gateway to East Africa and the UAE strengthens its role as a global logistics and financial hub, their partnership creates unprecedented opportunities for economic transformation that benefit businesses, workers, and communities in both countries while contributing to broader regional prosperity and development.

The upcoming presidential visit and continued implementation of the CEPA framework will undoubtedly further cement this historic partnership while creating new opportunities for economic cooperation and shared prosperity in the years ahead.

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By: Montel Kamau

Serrari Financial Analyst

19th August, 2025