Home ECONOMY Uganda resists trade war push with Kenya over impounded milk

Uganda resists trade war push with Kenya over impounded milk

by biasharadigest
Market News

Uganda resists trade war push with Kenya over impounded milk

suspected counterfeit Lato milk
Workers load cartons of suspected counterfeit Lato milk in Kisumu on January 17. PHOTO | TONNY OMONDI  

Uganda will not take retaliatory action on Kenya’s move to confiscate and send back a consignment of milk that had been exported to the country.

President Yoweri Museveni said over the weekend that Uganda was not going to hit back at Kenya’s move, bringing to an end fears that Kampala would escalate the issue to a trade war with restrictions on Kenyan goods.

Mr Museveni opposed the plans by his Foreign Affairs minister and other Ugandan State officials to impose barriers on Kenyan exports after Kenya Bureau of Standards and Kenya Revenue Authority nabbed 19 truckloads of Lato milk mid last month. Uganda’s Foreign Affairs ministry wrote to the Kenya government last week demanding the release of the milk to avoid possible retaliation.

Kampala had sent a protest note to Nairobi demanding the immediate release of the consignments seized by Kenyan officials on alleged quality concerns.

“I saw people say retaliate; I will not accept because President Kenyatta is a very friendly person, very clear-headed on business because he is a businessman himself. He’s also very clear-headed on African issues,” Mr Museveni was quoted saying by the Daily Monitor newspaper.

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Mr Museveni pointed out that the countries in the region should do away with trade restrictions as it impacts negatively on integration.

Kenya and Uganda have been locked on a trade tussle over cross-border business touching on a number of goods.

The latest spat resulted from an influx of cheap Ugandan milk in the country that has seen farmers and Parliament raise concern over the negative impact that it has had on local prices.

Uganda is Kenya’s biggest trading partner in the region. Kenya’s imports from Uganda more than doubled between 2016 and 2017 from Sh19.28 billion in 2016 to Sh42.04 billion 2017. As at 2018, imports from Uganda to Kenya stood at Sh41.94 billion.

Exports to Uganda from Kenya on the other hand dropped from Sh62.16 billion in 2016 to Sh61.88 billion in 2018.

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