Abstract:
Kenya has become a driving force of trade integration at the regional and continental level, albeit
that this process is still incomplete. Kenya was the first nation, along with Ghana, to ratify the African
Continental Free Trade Area (AfCFTA) agreement in May 2018, as it was already engaged with its
main trading partners. Trade policy can generate mixed effects across the economy and within the
agricultural sector, reflecting differences between markets and commodities. In this paper we argue
that a mix of modelling approaches is preferable in order to capture the complexities of these
changes. A dynamic-recursive computable general equilibrium model provides broad sectoral and
macro-economic effects, which are then incorporated into a partial equilibrium framework for a
detailed analysis at the sector level. We demonstrate this using the maize and wheat markets in Kenya
as examples. Combining the output of each modelling approach allows the analysis to explicitly
include certain characteristics of single markets, particularly regional trade relationships and
differences in pricing structure that would be missed by using a single approach in isolation. It shows
that further intra-African trade liberalisation will affect wheat markets more than maize in Kenya
but, given the low initial tariff levels, the ultimate effects will remain fairly small.
