NAIROBI (January 07 2004): Kenya will lose its share of the crucial Pakistani tea market if it does not open up to more exports from Pakistan, a trade official told Reuters on Tuesday.

Pakistan is the biggest importer of Kenyan tea, lapping up about a quarter of the east African country's total production of 287.1 million-kg in 2002.

Kenya imported $112 million worth of goods from Pakistan, mainly wheat and rice, compared to $135 million that it exported.

"Pakistan is under tremendous pressure from Sri Lanka, Bangladesh and India to sign free-trade agreements based on tea especially in the context of the Saarc conference that has just been concluded," said Safdar Sohail, Pakistan's Commercial Counsellor to Kenya.

"If plans go as have been envisioned and India gets some tariff reductions by 2006, there is no way that Kenyan tea would be able to compete with Indian tea."

"We are suggesting that before that kind of time comes, Kenya's government should move quickly to sign an agreement which could see their share going higher," Sohail added.

However, Kenyan tea authorities said they were not worried about the threat by Indian tea, saying that its world-famous tea with a distinctive flavour could hold its own against competition.

"Teas from different places have distinct characters. Kenyan tea is world renowned but we should not sit on our laurels and pretend nothing is happening," the Kenyan marketing official said.

Sohail said Pakistan submitted a free trade agreement draft in April 2003, seeking a mutual reduction in tariffs, but that they have not received a 
response yet.

Pakistan proposes to export fabrics, agricultural machinery and chemicals to Kenya should such an agreement be made.

"A favourable agreement would be welcome especially for tea but before signing, you should look at everything. It is good for tea, but what will we open ourselves to," the Kenya Tea Board official said.

Courtesy Business Recorder