For the first time in ten years, the volume of trade between Kenya and Tanzania has recorded a decline, retreating from a record high and raising fresh concerns about slowing momentum between East Africa’s two largest economies. According to the 2026 Economic Survey, total bilateral trade fell by 9.4 percent to KES 114.1 billion in 2025, down from an all-time peak of KES 125.9 billion in 2024.
This decline marks the first drop since 2016, breaking a sustained growth trend that had seen trade more than double over the past decade. The last contraction occurred nine years earlier, when trade shrank by 5.9 percent to KES 47.61 billion, largely due to protectionist policies imposed by former Tanzanian President John Magufuli, including restrictions on Kenyan goods and tighter border controls. The current downturn, however, comes under a different political environment one of renewed diplomatic warmth between President William Ruto and Tanzanian President Samia Suluhu, suggesting that economic rather than policy factors may now be driving the slowdown.
Drivers of Kenya – Tanzania Trade Decline
A breakdown of the figures shows that Kenyan exports to Tanzania declined by 5.3 percent to KES 63.63 billion in 2025 from KES67.2 billion the previous year, signaling softer demand in a key regional market. According to the Kenya National Bureau of Statistics, this downturn was mainly attributed to reduced domestic exports of soap and flat-rolled iron and non-alloy steel products to Tanzania.
At the same time, imports from Tanzania dropped even more sharply, by 14.1 percent to KES 50.47 billion from KES 58.72 billion, pointing to reduced purchasing activity and possible shifts in supply chains. Despite the overall contraction, Kenya’s trade surplus with Tanzania widened by 55.2 percent to KES 13.16 billion, up from KES 8.48 billion in 2024, a result driven more by the steeper fall in imports than by stronger export performance. The data highlights increasingly volatile trade patterns between the two neighbors, with sharp swings replacing the relative stability seen before 2020.
The disclosures in the Economic Survey come ahead of President Ruto’s expected address to Tanzania’s Parliament, which is a high-stakes visit aimed at strengthening economic ties. Both leaders are also scheduled to attend a Kenya–Tanzania Business Forum bringing together private sector players to explore ways of boosting trade and investment. After lingering below KES 60 billion for years, total trade surged to KES 100 billion in 2021, climbed by 11.4 percent to KES 111.4 billion in 2022, edged up 1.4 percent to KES 112.9 billion in 2023, and jumped 11.5 percent to a peak in 2024. The turnaround in 2025 now raises questions about the sustainability of that growth, underscoring the need for urgent bilateral measures to restore momentum.
