Market Survey of Mozambique

Kenya's trade has expanded substantially since the introduction of liberalization reforms, with exports increasing from US $ 2.70 Billion in the year 2004 to US $ 4.90 Billion in 2008 registering an annual average growth of 16.50%. The upward trend in export growth is to be maintained under the country’s Vision 2030 policy framework, in which trade sector is expected to contribute significantly towards the attainment of economic growth target of 10% in the planning horizon.
However, Kenya’s overall trade imbalance continues to widen, with imports rising from US $ 4.60 billion in the year 2004 to US $ 11.0 billion in the year 2008 registering an annual average of 28.40%. The main  exports  remains dominated by primary commodities including horticulture, tea, articles of apparels & clothing, soda ash, coffee, iron & steal, which together account for over 60% of total exports. Further, the regional destinations for Kenya’s exports are concentrated within COMESA, EU and other African countries.

From the analysis, total bilateral trade between Kenya and Mozambique has more than doubled during the period 2004 to 2008 rising from US $ 8 million in 2004 to US $ 17 million in 2008, an annual average growth of 22%. This trade though is skewed in favour of Kenya which has maintained a trade surplus with Mozambique throughout this period, is still very low. The trade surplus ranged between US $ 3.31 million and US $ 9.28 million between 2004 and 2008.

Kenya exports to Mozambique grew from US $ 6.7 million in 2004 to US $ 13.2 million in 2008, representing an annual average growth of 23.4% while imports from Mozambique grew from US $ 1.3 million to US $ 3.9 million an annual average growth of 61.5% during the same period. Kenya’s main exports to Mozambique were sugar confectionary, pharmaceuticals, and footwear made of textile while Mozambique’s main exports to Kenya were liquefied butanes and sugar.

It is therefore recommended that to expand the trade, Kenya must not only consolidate and expand her exports to the Mozambique, but also diversify her basket of export products. Kenyan footwear exports enjoy sizeable market share in Mozambique and the shares need to be expanded. There are potential products which Kenya has a capacity but currently export little or do not export to Mozambique and Kenya should consider exporting them. The products, mostly manufactured products, includes among others: animal/vegetable fats and oils, paper and paper products, dairy products, construction materials (iron & steel, and cement), glass ware, beverages (fruit juices, wine and spirits), in-organic chemicals (soda ash), rubber articles, soaps and detergents.

Analysis of potential export products to Mozambique
In this section, products with export potential have been identified through consideration of the following factors: Kenya’s global exports to Mozambique, Kenya’s global exports and Mozambique’s global imports. Trade potential is deemed to exist in two cases; the first case represents products in which Kenya already has market presence in Mozambique and the second category of product refers to cases where there is a match between Kenya’s exports to world and Mozambique imports from world although no actual trade is reported between the two countries.

Products with supply base but minimal or no presence in MozambiqueCement
Products with presence in MozambiqueRaw tobaccoFlat rolled zinc coated productsFootwearPharmaceuticals

Sugar confectionary (Chewing gum)  

What is Covered in this report.
1.0 Background 5
2.0 Key Economic Indicators 6
2.1 Kenya: Country profile 6
2.2 Mozambique: Country Profile. 7
3.0 Trade flow analysis 9
3.1 Kenya’s Foreign Trade: an Overview 9
3.1.1 Balance of Trade 9
3.1.2 Kenya’s Export Composition 10
3.1.3 Geographical Distribution 10
3.1.4 Kenya’s Merchandise Imports 11
3.2 Trade between Kenya and Mozambique 12
4.0 Analysis of potential export products to Mozambique 14
4.1. Market Analysis for Kenya’s Potential Exports to Mozambique 14
5.0 Conclusion and recommendations 19
5.1 Conclusion 19
5.2 Recommendations 19

Figure 1 Proportion of Kenya’s Merchandised Exports in 2008 9
Figure 2: Kenya’s Trade Balance 2003-2008 10
Figure 3: Proportion of Exports by Region in 2008 11

Table 1: Proportion of Commodity Exports, 2004- 2008 (%) 10
Table 2: Value of Merchandise Exports by Region in Billion Kshs (2004- 2008) 11
Table 3: Trade balance between Kenya and Mozambique (In US $ millions) 12
Table 4: Top Kenyan Exports to Mozambique 13
Table 5: Top Kenyan Imports from Mozambique 13
Table 6: Analysed products 14


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