The Kenya-China deal aims to diversify the east African nation's markets and "reduce trade imbalances", Trade Minister Lee Kinyanjui said in a statement.
The deal will allow for 98.2 percent of Kenyan goods to enter China without import taxes, notably eliminating tariffs on its crucial agricultural exports, Kinyanjui said.
The deal still requires ratification by parliament, his office told AFP.
Many African countries are increasingly looking to China and other trading partners since US President Donald Trump increased steep tariffs on countries worldwide last year.
Trump's administration imposed the lowest tariff increase of 10 percent on Kenya, but it was also hit by the expiration of the African and Opportunity Act (AGOA) in September, a longstanding deal that provided duty-free access to the US market for cars, clothes and other items from 32 African countries.
US lawmakers belatedly approved a three-year extension to AGOA this week, but it has yet to be approved by the Senate or signed into law.
Last year, US Senator James Risch called for an investigation into Kenya's trade relations with Beijing, which has invested heavily in the country's infrastructure.
Kenyan media reports have said US pressure delayed the deal with China, but Foreign Affairs Principal Secretary Korir Sing'oei this week dismissed the claims as "completely unfounded."
"We see no tension between our concluding a market access arrangement with China on one hand and our robust push for AGOA re-authorisation," Sing'oei posted on X.
On Tuesday, Republican Ways and Means Committee Chairman Jason Smith called for the urgent finalisation of the AGOA deal, warning that Beijing had made huge investments to "monopolise" the market.
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