Kenya Signed Trade Agreement With Indonesia

Kenya signed trade agreement with Indonesia

Kenya has signed an agreement with Indonesia to manufacture and distribute pharmaceuticals and vaccines, as part of its efforts to rejuvenate its pharmaceutical sector. This deal is part of a larger set of six agreements encompassing food security, mining, and renewable energy.

These agreements, which resulted from discussions between President William Ruto and Indonesian President Joko Widodo, will facilitate collaboration between Kenya’s Biovax and Indonesia’s BioFarma for the production of vaccines and other pharmaceutical products, promoting easy accessibility between the two nations.

In a health-focused memorandum of understanding (MoU), these two companies will also explore marketing opportunities for the vaccine portfolio to be manufactured by BioFarma in Kenya.

According to the Ministry of Health, the government has invested up to Ksh2 billion ($13.85 million) in the Biovax project, with a primary focus on the manufacturing of Covid-19 vaccines and other related immunizations.

This development aligns with the Kenyan government’s push for local production of healthcare products to reduce excessive reliance on imports and generate employment opportunities.

Additionally, the Kenya Pharmacy and Poisons Board and the Indonesia Food and Drug Authority have signed an MoU aimed at enhancing regulatory cooperation in pharmaceutical products.

President Ruto emphasized the need for collaborative efforts, involving the private sector, to build the capacity for vaccine and pharmaceutical production in their respective countries, ensuring they are not caught unprepared as they were during the Covid-19 pandemic when they lacked the facilities to produce their vaccines.

Furthermore, Dr. Ruto highlighted Kenya’s openness to business and discussed the importance of concluding a bilateral investment treaty to create a stable and predictable investment environment, a crucial factor in encouraging private sector investment. Drafting this treaty is expected to be completed within the next 90 days.

Indonesia enjoys a favourable trade balance with Kenya, with expectations of exporting goods worth $580 million (Ksh83.75 billion) to Nairobi by 2021, with palm oil as a primary export. The country’s exports to Kenya, including items like hot-rolled iron bars and stearic acid, have experienced a steady annual growth rate of 14.5 percent over the past 26 years, driven by increased local demand for cooking oil.