2009 AGOA FORUM UPDATE

UNCLAS NAIROBI 000177

STATE PASS USTR CONNIE HAMILTON, PATRICK DEAN COLEMAN, AND WILLIAM
JACKSON

STATE FOR AF/FO, AF/E, AND AF/EPS ANN BREITER, GABRIELLE MALLORY,
MARY B. JOHNSON, AND TAWANNA DAVIDSON

STATE ALSO FOR AF/EX SYLVIE MARTINEZ AND AF/PD CLAUDIA ANYASO
STATE ALSO FOR EEB/TPP/BTA AMY HOLMAN
STATE PLEASE PASS USAID/EA AND USAID/AFR/SD BRUNO CORNELIO
TREASURY FOR DAN PETERS AND REBECCA KLEIN
COMMERCE FOR KEVIN BOYD, ALICIA ROBINSON, AND BECKY ERKUL
AGRICULTURE FOR DON EVANS AND CATHY MCKINNELL

SIPDIS

E.O. 12958: N/A
TAGS: ASEC AMGT ECON ETRD AGOA PGOV PREL KE
SUBJECT: 2009 AGOA FORUM UPDATE

REFS: (A) 01-29-2009 YOUNG-MALLORY EMAIL, (B) 09 NAIROBI 0049
(C) 08 NAIROBI 2839, (D) 08 NAIROBI 2594, (E) 08 STATE 114398
(F) 08 NAIROBI 2224, (G) 08 NAIROBI 2005, (H) 08 NAIROBI 1692


1. This cable is not/not for internet distribution.


2. Summary. The Government of Kenya (GOK) continues to plan for
the upcoming 2009 AGOA Forum scheduled for Nairobi the week of
August 3, 2009. The GOK has proposed August 4-6 as the specific
dates within that week for the three-day affair. At the same time,
Kenya forum planners also suggest that the private sector (and
presumably the civil society) program take place on the first day to
allow for its members' input to be considered by African and U.S.
government officials over the final two days. Proposed program
details are below. Organizers are looking forward to the early
February visit of the State Department's AF/EX advance team to go
over logistical arrangements as well as the possible mid-March
interagency visit. GOK officials confirmed that new Trade Minister
Amos Kimunya has replaced Deputy PM and new Finance Minister Uhuru
Kenyatta as the lead minister for the AGOA Forum. The next GOK AGOA
Forum Preparatory Committee meeting is scheduled for Thursday,
February 12. End summary.

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New Kenyan Lead Minister for AGOA Forum
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3. At the conclusion of the Government of Kenya's (GOK's) January
29 AGOA Forum preparatory committee meeting, Vice Chairman Richard
Sindiga confirmed that Deputy Prime Minister Uhuru Kenyatta is no
longer the lead minister for the AGOA Forum. In his stead, former
finance minister Amos Kimunya has taken over as trade minister and,
as a result, now heads GOK preparations for the forum. On January
23, Kenyan President Mwai Kibaki unexpectedly named Kenyatta as
finance minister and Kimunya as trade minister. Kimunya resigned as
finance minister last July after Parliament passed a no-confidence
vote against him when it learned that he had allegedly lied about an
imminent secret sale of a government-owned property, the Grand
Regency Hotel, to a Libyan group in violation of the Public
Procurement and Disposal Act. (Note: A yet-to-be-released inquiry,
the "Cockar Commission Report," reportedly concludes that Kimunya
did, in fact, mislead Parliament in late April 2008 about the hotel
sale. While the Cockar Commission Report does not hold Kimunya
accountable for the sale per se, it does fault him for not opposing
the sale and failing to require that it be tendered as required
under the Public Procurement and Disposal Act. See refs G-H and
septel. End Note.)

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Specific Forum Dates
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4. During the January 29 meeting, the GOK proposed that the
three-day forum should be held August 4-6 in Nairobi, giving us
specific dates within the original August 3-7 window. Following a
suggestion from the private sector subcommittee, the preparatory
committee agreed to propose that day one be devoted to the private
sector/civil society; day two to a conclave of African trade
ministers; and day three to the USA-Africa Ministerial. The theme
of the 2009 AGOA Forum would be "Realizing the Full Potential of
AGOA: Bridging the Gap."


5. Economic Counselor said he would seek Washington's concurrence
with the proposed specific dates of August 4, 5, and 6. E/C
informed preparatory committee members that the Ambassador and other
senior US Embassy officials are reviewing the GOK's suggested joint
press statement announcing the forum. Once the Ambassador gives his
approval, the US Mission will seek Washington's concurrence.

6. E/C also informed Sindiga and the preparatory committee that the
State Department will send an advance team to Kenya the week of
February 9 to meet with committee members responsible for logistics.
E/C noted that a larger USG interagency team would likely visit
Kenya in mid-March. The Kenyans welcomed the announcements of the
USG visits and said they look forward to working with their DC
counterparts in firming up logistical arrangements and the forum's
agenda. Both E/C and GSO officer emphasized that the USG would like
to see rapid progress on badging and accreditation procedures. In
response, the GOK Conference Subcommittee, led by a Kenyatta
International Convention Centre (KICC) representative, promised it
would come back to the full preparatory committee at the next
meeting (February 12) with additional information on plans for
badging and accreditation.

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GOK Program Suggestions - Private Sector Day and U.S./Africa Day
-------------- ---


7. The GOK tentatively supports the suggestion by the Private
Sector Subcommittee to devote the first day of the three-day forum
to the private sector session. While there was no discussion of
when the civil society session would take place, all of the GOK's
previous information has placed the private sector and civil society
programs on the same day. The private sector is seeking a day one
program so that its representatives will be well placed to provide
input to the programs on days two (Africa Ministerial) and three
(Africa/U.S. Ministerial). The private sector is also proposing
that it host a reception the evening of day one, and breakfasts for
the African Ministers and the U.S. delegation at the start of each
of the next two days as well as a lunch on day three.


8. Private sector program suggestions: Following an opening
plenary of 30 minutes on day one, the private sector proposes the
following:

-- Plenary 1 (morning): Sustainability of AGOA - What next beyond
2015?

-- Breakout sessions (morning; each sector would address what the
private sector wants to achieve under AGOA, successes and challenges
so far, and specific recommendations to bring to the attention of
African and U.S. Ministers):

(a) Energy
(b) Fresh Produce (flowers, fruits, vegetables)
(c) Tourism
(d) Textile and Apparel
(e) Coffee, Tea, Commodities
(f) Health
(g) Category 9 market access

-- Plenary 2 (afternoon): Competitiveness of African Suppliers:
Infrastructure concerns (road, railway, airport, port, energy)

-- Breakout Sessions (afternoon):

(a) Information and Communication Technology
(b) Diversification and Value-addition
(c) Finance and Insurance (realizing the promise of existing
financial instruments (EXIM, OPIC, USTDA),the challenge of tied
assistance; insurance instruments)
(d) Research and Development - Organic vs. Genetically Modified
Foods
(e) Enterprise Development
(f) Market Access and Market Development


9. For day three (the U.S./Africa Ministerial Day),the GOK's
technical subcommittee has also proposed a program. Please note
that day two, at this stage, would likely end with a "bush dinner"
in Nairobi National Park or some other gala dinner hosted by the
GOK. The draft program, following an opening plenary session, is as
follows:

-- Plenary 1 (morning): AGOA eight years on: Successes,
Challenges, and Prospects. Presentations on a regional basis - e.g.
EAC, ECOWAS, SADC, and COMESA.

-- Breakout Sessions (morning):

Session 1 - trade and investment in agriculture. The session will
look into the need for value addition and challenges as well as
challenges and opportunities for investment in agribusiness.

Session 2 - trade and investment in textile and apparel. This
session will look into:

(a) AGOA challenges - reasons for declining textile exports under
AGOA, including the impact of removal of China safeguard measures
and the NPDA bill.

(b) Category 9 - the status of utilization of this category vs.
others, challenges that have been encountered, steps that SSA
countries can take to enjoy this facility as well as improve
utilization.

(c) Vertical integration barriers to investment and remedial
measures.

Session 3 - SMES programs and access to finance. SMES play an
important role in the economic development of African countries.
The session will therefore look at what programs the African
governments have put into place to promote SMES in addition to
access to finance.

Session 4 - Trade and investment in the energy sector. The session
will look at oil exploration and trade, and alternative sources of
energy.

Session 5 - Contemporary global challenges. The session will look
at the following and how they affect trade and investment: global
warming, security bio-terrorism and piracy, and the global economic
recession.

Session 6 - Regulatory regimes. The session will look at the U.S.
regulatory regimes and their effect on AGOA. Presentation from
APHIS Regional hubs and FDA among others on the following will be
vital - quality standards and SPS.

-- Plenary 2 (afternoon): Exploiting AGOA for maximum benefits

-- Breakout sessions (afternoon):

Session 1 - Enhancing competitiveness. This session will look at
supply side constraints, human and technical capacity building,
necessary government incentives/subsidies, and regional
integration.

Session 2 - Enabling private investment. This session will look at
private/public partnerships for enhanced trade and investment under
AGOA, a conducive investment environment, e.g. the importance of an
enabling policy framework for investments, and attracting U.S. FDI
flows.

Session 3 - Market development. This session will look at
product/regional promotion (i.e. the need for strategic and joint
marketing programs for SSA, existing support programs (e.g. the
hubs),and product development and the importance of branding and
image.

Session 4 - Investment in infrastructure. This session will look at
what governments have done in this sector which is crucial for
trade, particularly in the areas of transport (roads, rail,
airports, and ports),and ICT.

Session 5 - Technical assistance and the role of aid for trade and
investment.

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Private Sector Exhibition
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10. The private sector subcommittee is also working with the
conference subcommittee to put together a product exhibition to
coincide with the AGOA Forum and which will be held on the grounds
of the KICC. The private sector subcommittee describes their broad
objective as "mobilizing both African and U.S. AGOA private sector
beneficiaries to participate in the Exhibition in a manner that will
deepen not only Kenyan but also African exports to the U.S. market."
The private sector subcommittee is headed up by the Kenyan
Association of Manufacturers (KAM) and includes the American Chamber
of Commerce in Kenya (ACCK). The subcommittee is aware of the
Corporate Council on Africa's (CCA) interest in the forum and is
seeking to reach out to it and other U.S. business organizations.

Ranneberger