By the Blouin News Business staff

New allies: Kenya, South Africa boost cooperation

by in Africa.

Kenyan President Uhuru Kenyatta (C) flanked by Deputy President William Ruto, addresses the Nation at the State House capital Nairobi on April 4, 2015. JOHN MUCHUCHA/AFP/Getty Images

Kenyan President Uhuru Kenyatta addresses the Nation in Nairobi on April 4, 2015. JOHN MUCHUCHA/AFP/Getty Images

Kenyan President Uhuru Kenyatta met with his South African counterpart Jacob Zuma on Sunday, and they agreed to create a Joint Commission of Cooperation (JCC). Kenyatta is the guest of honor at the Sixth Ordinary Session of the Pan African Parliament, held in South Africa starting on Monday, so it is a convenient moment to improve relations with Zuma’s government.

The JCC, to be formed within the next two weeks, will promote economic, political, and social cooperation between Kenya and South Africa. Trade and industrialization are two prime areas of importance for creating badly-needed jobs for the young populations of both countries. While South Africa’s economy is second in size only to Nigeria in Africa, much of the population does not have opportunities for steady or well-paid employment. (The key issue behind the bouts of xenophobic violence that rocked South Africa last month were locals’ fears that immigrants from other African countries were taking away job opportunities.)

The economic relationship between the two countries is unequal, in that South Africa has a consistent high trade surplus with Kenya. For example, in 2012 South Africa exported $708 million to Kenya, and imported only $30 million in return. South African Minister of Trade and Industry Dr. Rob Davies described Kenya as a strategic country for South African companies looking to access the East and Central African markets, and said Kenya boasts strong agricultural and manufacturing sectors which make it a key trade and investment destination.

Previously South African companies faced distrust and major red tape in Kenya, but a meeting in early 2013 organized by the First Kenya & SA Trade Forum was crucial in repairing relationships. About 60 business executives from South Africa and 40 from Kenya ironed out “differences,” including non-tariff barriers, visas, taxation, trade licenses and immigration processes, according to the Financial Mail. From 2009 to 2015, there have been 17 South African FDI projects in Kenya worth $185 million in total, Davies added. And more are likely to materialize as ties grow between the two countries — in part thanks to a business delegation of 31 South African companies that participated in the Outward Selling and Investment Mission to Kenya and Tanzania in February.

Kenyan officials will also try to persuade South Africa to drop or reduce its onerous visa requirements for Kenyan citizens, which impedes the flow of trade and tourism. Kenyans currently do not need a visa if they stay 30 days or less, but face a roughly $60 entrance fee. A visa for a longer stay costs the same amount, but cannot be processed from within South African territory, meaning that Kenyans wanting to stay would have to return to Kenya and then file for a visa. South Africa imposed these tighter restrictions in mid-2014, in an effort to curb foreign competition for local jobs. Kenya initially retaliated with similar sanctions but suspended them in August after South African authorities reportedly called for talks — which are only happening now.

The two countries also agreed to boost their regional cooperation, including the integration of the East African Community and the Southern African Development Community. “We stand to gain more if we work together,” Kenyatta emphasized. Additionally, the two presidents agreed to share information to help combat terrorism, and reiterated their support for the East African Community’s stance to resolve the Burundi political crisis.

Zuma and Kenyatta will exchange official state visits, as will their Ministries of Foreign Affairs. Expect bilateral trade and investment to grow in the near future.