How to Import Goods into Kenya

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How to Import Goods into Kenya

Kenya is known as a third world country struggling to survive. However, after the 2017 presidential election, Kenya showed the world that they still have the dedication and resources to improve as an economy. In fact, over the last decade, Kenya has recorded a GDP growth of 5.9% and got placed as one of the top performers on the African continent.

This significant data has made way for many foreign investors to invest in this country. Many businesses including B2B platforms have been studying Kenya import data to see if their goods stand any chance of getting sold. One reason for this is that export data of Kenya shows that not many local businesses are involved in sending their products across the border.

Having that said, let me provide you with a small guide on how you can import and be competitive in this growing country.

PRICING

If you are an exporter, one thing that you need to understand is that Kenya’s local suppliers are highly competitive and have most of the market share. On the other hand, the wealthiest 10% of the population holds 39% of the income. While the poorest 10% only hold 2%. This figure indicates that due to inequality within the economy you can’t expect to sell your stock at a high price.

If you want to compete with the local suppliers, we suggest that you price your products with a margin of 10%-15% over cost. Though this may seem a bit too low, you won’t ever feel the need to increase it as your number sales will cover it. On the other hand, there is an exception for unique products. If you import a first-of-its-kind product in the Kenyan market, you are free to set the price according to factors of demand and supply.

DOCUMENTATION REQUIREMENTS

Just like any other country, Kenya is also strict with its import and export rules and regulations. To avoid getting into any trouble and to get all your goods cleared by the customs department you’ll need the following documents.

  • Export Manifest: this is the detailed doc carried by the cargo carrier. This doc will show all the cargo on board, weight and dimension details, and details of the sender and the receiver.
  • Airway Bill: this document has a summary of all the material inside the package. It’s basically an agreement between the receiver and sender and issued after the package is dispatched from its origin.
  • Customs Bond: this is proof of the exporter agreeing to all customs laws and duties of Kenya. The exporter must sign this bond and reveal it to the customs officers.
  • Certificate of Origin: this certificate is issued by the government of the exporter’s country. If the state is a trade ally of Kenya, then these imports will receive special preference and care.
  • Pre-shipment Inspection: a certificate of proof of inspection also needs to be provided by the importer. This document will be issued after a thorough review is done before the shipment gets shipped.
  • Import Declaration Form: The agent clearing the goods prepare this doc. This form will include a summary of all docs accompanied with the shipment.

IMPORT TARIFFS FOR KENYA

  • The customs duty enforced under The East African Community (EAC) varies from 1% to 100%, with the average being 25%.
  • No minimum threshold is set in this nation. Therefore, tariffs are payable regardless of the value or quantity of the imports.
  • A standard rate of 16% of VAT is applicable on the sum of all tariffs combined
  • Other custom and tax fees
    • An Import Declaration fee will be charged with25% of the CIF value or Ksh 5000 per import. – Higher of the two is to be paid!
    • Alcoholic beverages and tobacco are charged an excise duty. This fee will be a percentage that’ll be decided according to the quantity or values of your shipment.

Major Import Origins of Kenya are:

  • The UK ($660m)
  • South Africa ($793m)
  • Japan ($892m)
  • China ($3.22b)
  • India ($3.93b)

Major Export Destinations are:

  • The UK ($419m)
  • The USA ($439)
  • The Netherlands ($489m)
  • Uganda ($533m)
  • Zambia ($680m)

WRAP UP

According to Kenya import data, you can clearly see how dominant China and India are in sending their products to this country. On the other hand, export data Kenya shows that they are dealing with a massive BOP deficit. However, with the economy growing, many manufacturers have shown interest in exporting goods to reduce the BOP and also bring in foreign currency to the nation. You as an international export need to keep these guidelines in your minds to avoid getting caught up in any mess.

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