Kenyan Factory to Fire 1,000 Employees After US Deal Expiry

Kenya’s United Aryan factory will lay off 1,000 workers after the African Growth and Opportunity Act (AGOA) expires on September 30.

The factory, which produces Wrangler and Levi’s jeans for the US market, is set to face import duties of 33 percent, up from 10 percent under AGOA.

On September 26, the factory CEO, Pankaj Bedi, stated that the layoffs would have severe consequences for thousands of families.

Uncertainty Clouds US Trade Relations

Bedi represented the Kenyan Association of Manufacturers at meetings in New York, where African leaders were given off-the-record assurances that AGOA could be renewed.

“Everybody we met from the US side is in agreement that, yes, AGOA should continue,” he said.

“But still, there’s no champion… They’re all waiting for a sign from the White House, basically,” he added.

Lawmakers in Washington have faced political gridlock, with debates over government spending and trade priorities leaving little room for African trade deals.

Some officials have indicated that AGOA might be renewed retroactively in November for a period of two years.

Impact on the Kenyan Industry

US President Donald Trump’s focus on bilateral trade deals and tariffs has disrupted African exports.

“The uncertainty is not only with buyers, but with lenders, the banks, and all that. Everybody’s very nervous,” Bedi noted.

Also Read: Mass Layoffs Loom as International Conglomerate Plans to Fire Over 2,000 Kenyan Workers

Notably, Kenya’s textile sector relies heavily on the US market under AGOA.

With the deal expired, higher tariffs make Kenyan goods less competitive compared to those from cheaper producers in Bangladesh, Vietnam, and other Asian countries, potentially reducing export volumes and affecting the revenue of local manufacturers.

Latest on AGOA Renegotiation

The African Growth and Opportunity Act (AGOA) is a U.S. trade program enacted in 2000 to enhance economic relations between the United States and sub-Saharan Africa.

It provides eligible African countries with duty-free access to the U.S. market for over 1,800 products, including textiles, apparel, and agricultural goods.

To qualify, countries must demonstrate a commitment to market-based economies, the rule of law, and respect for human rights.

Also read: Mass Layoffs as CMC Motors Shuts Down in Kenya After 40 Years

As the expiration date approaches, discussions are underway regarding the future of AGOA.

Ruto on AGOA Renewal

On Wednesday, September 24, Kenya’s President William Ruto announced that Nairobi expects to sign a trade deal with the United States by the end of the year and will push Washington to extend its duty-free agreement with Africa for at least five years.

Ruto emphasised the importance of renewing AGOA to address trade imbalances and strengthen U.S.-Africa ties.

He noted progress in bilateral negotiations and highlighted Kenya’s desire for broader U.S. market access for products such as tea, coffee, and avocados, while also exploring new sectors like mining and fishing.

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