It is a Friday afternoon and more than 1,000 women cross-border traders are gathered at the stadium in Rubavu District, singing and dancing to local traditional music.

The women have reason to be happy; this last May event hosted by a Rwandan civil society organization, Pro-Femmes TweseHamwe (PF/TH) and supported by TradeMark East Africa (TMEA), is an opportunity to get information on how to overcome the numerous challenges they face in their trade with neighbouring countries.

In the past, such opportunities never happened; instead the women traders were often harassed and goods confiscated as their business was deemed illegal or smuggling.  "We could use short cuts to dodge border authorities; on a good day you could pass without being caught but often we could be apprehended and made to pay heavy fines,” says Florida Nyirambonigaba, a trader at Cyanika border.

Indeed, a 2012 baseline study by PF/TH revealed that informal cross border traders, 74% of them women, faced harassment from border officials, insufficient information on regional trade protocols and services, limited access to credit, robbery and loss of goods. Such losses perpetuated poverty in families in which these women are the breadwinners.

Thanks to a PF/TH project funded by TMEA and implemented since 2012, these women can now afford to be happy. Under its first phase, the project targeted women informal cross-border traders at six border districts bordering Burundi, Tanzania and Uganda (Bugesera, Nyaruguru, Gisagara, Kirehe, Nyagatare and Burera) with the objective of significantly increasing their revenues through formal trade and improved trade facilitation.

Now under its second phase, the initiative has been extended for two years (2016-2017) and expanded to cover three more border districts of Rusizi, Rubavu and Gicumbi bordering the DR Congo and Uganda. The project is currently being implemented in nine districts and covers 14 border posts of Nemba, Kagitumba, Musheri, Rusumo, Akanyaru Haut. Others are Akanyaru Bas, Rusizi I, Rusizi II, Ruhwa, Kamanyora, Petite barriere, Grande barriere, Cyanika, Gatuna and two crossing points of Gasenyi and Gahara.

According to Chantal Umuhoza, the PF/TH project coordinator, about 2,000 cross border traders in the nine districts have already gained information on key issues relating to cross border trade. This information has helped them formalize and improve their businesses."The project supported us to move from informal to formal trade through the border post; this eliminated harassment at the border and improved our security and safety of our goods. Formal trade has improved our profits and household livelihoods,” says a beneficiary from Jyaheza Cooperative from Akanyaru Haut on the Rwanda-Burundi border.

In helping the women formalize their trade, the project also supported formation of cooperatives. To date, 27 women cross-border traders’ cooperatives are operational as a direct result of the project activities. However, the project currently reaches a total of 63 cooperatives in nine districts, including those that existed before the project started. "Working in cooperatives strengthened our teamwork and capacity building programmes improved our resource management, saving culture, access to finance, planning, ability to know whether we made profits or losses,” says a beneficiary from the East Gate Cooperative operating at the Rwanda-Uganda border of Kagitumba.

Previously, the women traded individually using small capital of $20 -$50. "Currently, cooperatives’ capital in form of only cash ranges between $1,500 and $6,000 depending on the nature of products and available markets,” says Chantal.

A bigger capital means bigger profits: the women have significantly increased their revenues and the amount of money they are able to take home and re-invest.

A recent evaluation of the project confirms that it has empowered targeted border communities to improve their economic wellbeing through enhanced trade across borders.

Available figures show that, 28% of cross border traders under the project have already reported improvement in nutrition, access to health insurance and ability to pay schools fees for their children. "There has been remarkable change in living standards of the members of the cooperatives and their businesses are better organized,” says Chantal.

Access to finance

The cooperatives PF/TH helped to form have facilitated mobilization of border traders towards easier access to finance.

Through PF/TH and TMEA support, 15 cooperatives have already accessed loans totaling $100,000 from savings and credit cooperatives (SACCOs) through the Business Development Fund (BDF). These loans have enabled members expand their businesses, earn more and improve their incomes and welfare.

Under the ongoing second phase of the project, Pro-Femmes will also implement a cost-sharing fund initiative, in which more than 20 cooperatives will be given grants of about Rwf10 million each to enable implementation of value addition projects which will help them to grow their businesses and increase their revenues.

Sustainability

According to Chantal, the cooperatives have been supported to register businesses and linked to Rwanda Cooperative Agency (RCA), in order to sustain the achievements. The cooperatives are also being linked to the Private Sector Federation’s Chamber of Women Entrepreneurs. The two institutions will take on responsibility to follow up on these cooperatives. "In addition, cooperative members have been trained and linked with microfinance institutions that they can always approach for loans. Most of the cooperatives have good reputations and are acquiring assets that can be used as collateral,” Chantal said.

TMEA has also pledged to continue working with partners to implement interventions that address specific challenges faced by women cross border traders under the second phase of TMEA programme starting next year up to 2023. "Gender responsive programmes, especially those that address the specific challenges faced by women in trade, feature prominently in our 2017-2023 strategy.” says David Butera, TMEA Programme Manager. "This will include policy change advocacy as well as other interventions that will ensure that gender issues are prioritized in all projects funded,” Butera said. 

Economic linkages

Cross border trade is business in goods and services between neighbouring countries that takes place close to the borders and plays a big role in economic growth of a country. For Rwanda, this refers to trade with Burundi, DR Congo, Tanzania and Uganda.  As the World Bank 2011 Report points out, this trade is a fast-growing component of Rwanda’s export base. As of 2014, nearly 60% of Rwandan exports have been to EAC countries and DR Congo, amounting to $341.56 million (including $96.40 million to Kenya).  About $161.37 million worth of exports are through informal channels.

The project is, therefore, in line with the country’s goal to boost exports -from current levels of 8 to 11% of the country’s GDP to 28% by 2020- and has inter-sector economic linkages that could in the long run improve the tax base as untaxed informal trade is formalized.