Rwanda’s private sector is continuing to make efforts to not only expand within the country, but also reach out to other markets, especially in countries that have developed close relations with Rwanda.

Countries like Mozambique and Central Africa Republic (CAR), where Rwanda is providing support in terms of security, are potential markets for the local private sector, in addition to countries like Zimbabwe which have shown enthusiasm in doing business with Rwanda.

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The New Times talked to the Private Sector Federation (PSF) CEO Stephen Ruzibiza about this and more.

Excerpts:

There is this talk about the AfCFTA. What opportunities does it bring for Rwanda’s private sector?

It is a common market for African countries. What makes it a common market is that some of the trade regulations, restrictions, and procedures can be removed as countries meet and agree on what they are going to do away with, and what they are going to introduce to facilitate the movement of goods and services.

In this framework, a number of protocols have been signed to harmonise the required procedures and standards that will be used to trade.

Rwanda was one of the first beneficiaries of the piloting phase of trading under the AfCFTA. There are businesspeople who have started trading under this framework, but their volumes of course are not at a good level yet. There are some challenges here and there but at least the trade has started.

The government has been pushing Made-in-Rwanda. How do you rate the progress so far?

I can’t say it is good, but again, it is not bad. You have seen the VW which is being assembled in Rwanda for example. It is Made in Rwanda.

Made in Rwanda does not mean that a product has to start and end in Rwanda. There is a certain percentage of the in-country production that qualifies a product to be called Made in Rwanda.

In terms of industries coming up, we have seen a number in the country. Today we have over five industries that have invested in cooking oil, for example. In terms of manufacturing we are there, in addition to agro-processing, and even logistics.

Made in Rwanda does not necessarily mean that you look at the final product. Things like the percentage of Rwandans participating in a given business sector also matter because it contributes to their involvement and ownership of the process.

The high cost of air tickets is one of the issues affecting businesses in Africa. Have you tried to address the problem?

It is not only air transport but even normal logistics like road transport. The situation was actually worsened by Covid-19.

But specifically speaking about the flight costs, yes, they are high. I was reading social media comments that air transport from Germany to Turkey is $150 while from DR Congo to Nigeria, which is an equal distance, is between $500 to 871. That gives you a perspective of the cost.

We have tried to engage at the regional level EAC, with assistance from the regional private sector organisation – EABC, calling for more affordable air transport. We don’t say that it should be zero, but it should be affordable.

During the process, we learned that the tickets are not really expensive but what is expensive is the airport tax. That is the area where we want the government to intervene because taxes are more of the government’s portfolio.

In countries like CAR and Mozambique where Rwanda is supporting in terms of security, has the local private sector tried to explore any business opportunities there?

We have projects which are ongoing in CAR, and are under construction. The first building – a commercial estate is up and running. I think they are now in the process of discussing the functioning of the building and how they are going to utilise it. There are some businesspeople there in agriculture, trade and farming.

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In Mozambique, there is a joint collective investment company that has come up, and it wants to go to different business sectors. They are in the process of registration. I think they have already completed registration in Rwanda, but they have to co-register it in Mozambique. It is called Zambezia Limited. The holding is established in Rwanda but the subsidiary is the one that will be doing business in Mozambique.

What about Zimbabwe? Rwanda has been strengthening its relations with it and there have been some business forums. Are there some opportunities so far?

Business is nurtured. You have to go through feasibility studies and do a well-connected networking. It is a process; it is not a go-and-pick. There were people who were there even before the collaboration picked up. We have people in agriculture, for example, horticulture, and some are exploring the opportunity of setting up processing companies for agro-products. There is also a collective investment company that has come up for the purpose of raising business opportunities in Zimbabwe.

ALSO READ: Rwanda, Zimbabwe move to boost trade, economic ties

The government has introduced a new ministry for privatisation. What do you think about that?

Everything has a reason. I assume they had a good reason to put up a ministry in charge of privatisation. The beauty of this is that the government wants to privatise part of the state-owned corporations. I am okay with that because it builds the size of the private sector. The more the government has a hand in the private sector, the more likely it is to create monopolism and unfair competition.

When the government is moving away from the private sector role that means you are levelling the ground for economic participation.

This year, we have had economic challenges, especially related to high prices. Any lessons you have learned?

It is not only the Rwandan private sector that has suffered since these challenges have been global, but we have learned that at some point we should have done better to prepare for this kind of situation.

We probably should have put up reserves for particular commodities or goods that are essential to the businesses. We could have invested heavily and probably asked for government intervention in some of these sectors. The last lesson learned is that we should go into this thing collectively, it is not just the private sector alone that is going to suffer, but all of us.