In a competitive global market and at a time of dwindling trade barriers and border restrictions, economic diplomacy has become an all-important tool to secure investment opportunities through bilateral and multilateral trade cooperation.
Economic diplomacy deals with the nexus between power and wealth in international affairs. It not only promotes the state’s prosperity but also, as occasion demands and opportunity allows, manipulates its foreign commercial and financial relations in support of its foreign policy.
Current trends include increasing collaboration between state and non-state agencies, and increased importance given to WTO issues, the negotiation of free trade and preferential trade agreements, and accords covering investments and avoidance of double taxation. Abroad, embassies, consulates, and trade offices handle economic diplomacy.
The main focus is on promotion to attract foreign business, investments, technology and tourists.
Diplomatic relations through state visits, export promotion and development cooperation are relevant in minimising potential risks that businesses encounter, especially in Foreign Direct Investments.
They provide an avenue to mitigate various forms of risks such as political, legal and credit risks that may discourage potential exporters from entering foreign markets through negotiated trade agreements.
Last week’s Common Market for Eastern and Southern Africa (Comesa) Source 21 International Trade Fair and High-Level Business Summit that brought together 21 Comesa member states was a clear manifestation of the importance of regional blocs and the positioning of Nairobi as a regional economic hub and preferred conferencing destination. The forum, officially opened by President Uhuru Kenyatta, was held at the KICC.
In the past, Nairobi has hosted international conferences and at the same time, Uhuru has played host to heads of State and governments which yielded trade agreements.
The government’s Big Four agenda presents unlimited opportunities for investors. It is a chance to open new avenues to attract investments, create jobs and facilitate skills transfer.
At the Kenya National Chamber of Commerce and Industry (KNCCI), we have embarked on an aggressive push to expand the available trade opportunities in international markets through our extensive network. We are, however, cognizant of the need to adhere to global standards to capture these markets.
For instance, during the Kenya Trade Week 2019, we presented an agenda for the chamber to upgrade its Certificate of Origin (CoO) systems to accept the issuance of all preferential Certificates of Origin issued by the government.
Automation of the issuance of Ordinary Certificates of Origin will enhance the efficiency and security of the process. Additionally, the system shall hold a database on all pertinent export information which shall be used to target new markets and improve existing ones. Effectively, Kenyan traders will enjoy an expanded market for their goods.
For the last one month, the chamber has signed at least five trade pacts with foreign trade delegations and embassies in Kenya. We believe in a well-crafted and skillfully implemented economic statecraft for prosperity and security. The author is president, Kenya National Chamber of Commerce and Industry