Manufacturers urge EAC govts to prioritise energy, trade facilitation

On June 11, Rwanda and the other East African Community (EAC) member countries – Kenya, Uganda, Tanzania and Burundi – will present their 2015/16 financial year budget estimates. Before the D-Day, the The New Times will serialise views and budget expectations of various players in the local and regional economies, including traders, industrialists, academics and farmers, as well as bankers and SACCOs and the microfinance sector, among others. Today manufacturers tell us why they want governments to prioritise the energy and transport sectors, as well as support skills development and innovation, writes Peterson Tumwebaze. Robert Bayigamba, the chairman of the Rwanda Manufacturers Association, says increasing funding to the energy and transport sectors will facilitate industrial growth and boost Rwanda’s economic development generally. Bayigamba says there is need to further improve local infrastructure facilities to ease market access, “which will eventually reduce cost of doing business”. These sectors if well funded have the potential to boost the manufacturing sector, create jobs and facilitate export promotion, he argues. Bayigamba adds that supporting innovation and skills development is essential as it will provide the required personnel to run industries and help grow the sector. “All these initiatives will help reduce the cost of manufacturing and, ultimately, benefit consumers, and governments in terms of taxes,” Bayigamba told The New Times on Friday. According to the budget framework paper, Rwanda will spend Rwf1,768.3 billion during the 2015/16 financial year, an increase of Rwf5.9 billion compared to Rwf1,762.4 billion this year. This fiscal year, government prioritised infrastructure development, agriculture and export promotion to spur rural growth, one of the key components of the second Economic Development and Poverty Reduction Strategy (EDPRS II) development blueprint. Meanwhile, Lawrence Oketcho, the head of policy and advocacy at the Uganda Manufactures Association, urges regional law-makers to draft producer-friendly tax measures to fast-track economic development across the EAC bloc. “Most often such tax measures and reforms are designed to benefit consumers without considering producers. However, ignoring manufacturers means that consumers will still bear the burden of such reforms through price increases. Therefore, it is important that EAC governments adapt tax regimes, which will not deter consumption,” Oketcho counsels. He was speaking during the East African Manufacturers meeting in Kigali last week. Bernard Selemani, the vice-president of the Burundi Manufacturers Association, says EAC member states should invest more in value-addition ventures to make the industrial sector more competitive and profitable, as well as a vehicle for job creation. “We are talking about focusing on promoting standardisation and other facilities that will help support value-addition to boost regional export volumes and revenue.” Betty Maina, the chief executive of the Kenya Association of Manufacturers, calls for initiatives that will boost cross-border trade and industrial growth. “We expect regional governments to channel more money into Technical and Vocational Education and Training (TVETs) to produce the right expertise and reduce the skills gaps the region faces.” Regional manufacturers are currently seeking ways of working together in dealing with the challenges facing the sector. Last month, industrialists agreed to set up a lobby association to promote their interests. Dr. Samuel Nyantahe, the chairman for the Confederation of Tanzania Industries, says governments should work harder to eliminate trade barriers, arguing that they are pushing up the cost of doing business in the region. Rwanda’s manufacturing sector grew by Rwf67 billion during the fourth quarter of 2014 compared to Rwf68 billion during same period the previous year, according to data from the National Institute of Statistics of Rwanda. The sector also contributed only 5 per cent to the national growth domestic product (GDP).

News

Manufacturers urge EAC govts to prioritise energy, trade facilitation