Rwanda’s informal cross-border trade grew 79 per cent last year, surpassing projections, the Ministry of Trade and Industry Permanent Secretary, Emmanuel Hategeka, has said.

"Informal trade with the East African Community (EAC) and the Democratic Republic of Congo (DRC) grew by 79 per cent in the first eight months of 2012, which translates into a Rwf51b,” Hategeka said. 

"This is an indication that our trade with the region has expanded greatly…As a result, we are no longer focusing on European markets too much,” Hategeka said.

He added that market and product diversification were important elements in regional cross-border trade. Hategeka cited the growing regional market for unprocessed food and livestock as examples.

Hategeka highlighted the development while the Ministry of Trade and Industry presented its 2013/2014 budget estimates and medium-term expenditure plan before the Chamber of Deputies’ standing committee on budget and national patrimony recently.

If approved, the ministry will be allocated close to Rwf22b in the 2013/2014 budget, up from over Rwf14.7b this financial year.

Hategeka said formal trade with EAC countries and the DRC grew 62 per cent last year compared to an average of 30 per cent over the past few years. 

Rwanda’s exports are targeted for two types of markets; the international market for coffee, tea and minerals, and the regional one for unprocessed food and livestock, agro-processing and light manufacturing.

On sector performance targets, Hategeka said the construction sector was the star performer, growing by 15.2 per cent and earning Rwf387b. This was almost 50 per cent of all industrial output. 

He said manufacturing grew 4.5 per cent, but this was a 3 per cent decline from the previous year’s performance. 

He attributed the drop to a 55 per cent fall in revenues from furniture and other products. Earnings from the construction materials sub-sector rose by nine per cent in 2012, while agro-processing grew by two per cent.

Exports performance

Hategeka noted that the exports sector hit the 28 per cent growth target, realising over $482m from formal trade and $101m informal trade.

He revealed that non-traditional exports receipts have tripled in the last four years to $111m, with manufacturing contributing half of this growth. 

He noted that the re-export business segment was also growing markedly.

Hategeka cited poor infrastructure in crossborder markets as one of the key challenges facing the informal trade.