Kenya has opened talks with U.S. retail giant Walmart as it seeks to expand its market for tea, coffee and macadamia.
The talks that began on Thursday are being driven by Agriculture Cabinet Secretary Mutahi Kagwe, who is in the United States to drum up support.
The talks are among the multipronged approaches for Kenya as it seeks a new trade deal with the Donald Trump administration. Kagwe presented the case for Kenyan tea and coffee to the retail magnet, insisting that the country has the capacity to meet the demand with high quality and affordability.
“I have a feeling that there are some Kenyan products on your shelves that you might not know,” Kagwe said.
Go on to assert, “We want to establish a direct relationship, not through the English, the Irish or anybody else for that matter.”
During the presentation, leaders from the Kenya Tea Development Agency (KTDA) emphasised the advantages of sourcing tea directly from Kenya. They highlighted that this approach ensures the tea's freshness and traceability, ultimately leading to higher financial returns for local farmers.
Furthermore, macadamia farmers are also poised to benefit if the negotiations are successful, as Kenya aims to surpass South Africa and become the leading exporter of macadamia nuts to the U.S.
Macadamia Association of Kenya CEO Jane Maigua showcased Kenya's macadamia nuts as a premium product, cultivated organically by over 200,000 smallholder farmers. Notably, these nuts enjoy a 10 per cent duty rate compared to the 30 per cent imposed on South African nuts, which adds to their appeal for American buyers.
The CS who is leading a delegation in the U.S. will make the case for Kenyan agricultural produce with engagements lined up with the U.S. Departments of Commerce and Agriculture, the Governor of South Carolina, and private sector players.
The delegation will also participate in the North America Tea Conference.
Walmart has a complex history with the Kenyan market, having sought entry over a decade ago after acquiring South Africa’s Massmart in 2011. The American retail giant initially aimed to establish a presence in Kenya by pursuing a local chain as a target for acquisition.
However, an attempt to buy a controlling stake in the chain fell through in 2013 due to ownership disputes within the family involved.
After facing obstacles with the acquisition strategy, Walmart decided to build its own operations in Kenya. In 2015, Massmart opened a flagship Game store at Garden City Mall in Nairobi, supported by a $250 million investment.
Despite these efforts, Walmart struggled to compete with established rivals, like the French giant retailer, which rapidly secured prime retail locations in key areas.
Despite the challenges, Walmart continued to pursue expansion, unveiling its "Grow Africa" strategy in 2019, which included plans for more Game stores and the launch of Builders Warehouse in Nairobi.
By 2022, Walmart had established four outlets in Kenya, a modest footprint compared to leading supermarket chains.
