TOP STORY:Gov’t losing revenue from unprocessed hides and skins

With government expecting $10 million (Rwf5.4 billion) from the industry by 2012, the rotting of the products could further retard the revenues, which have already suffered a blow. Rwanda’s treasury might be losing millions of Francs, as stocks of hides and skins in slaughterhouses. Information from the Rwanda Development Board (RDB) shows that revenues from hides and skins are declining. According to RDB’s statistics, exports of hides and skins were short of $1.21 million (Rwf671 million) as compared to government’s estimated revenues of $4 million (Rwf2.216 billion) in the first eight months of 2008. The livestock products fetched $2.8 million (Rwf1.545 billion), which however represented a 0.3 percent increment over 2007’s earnings of $2.7 million (Rwf1.540 billion) in the same period. With government expecting $10 million (Rwf5.4 billion) from the industry by 2012, the rotting of the products could further retard the revenues, which have already suffered a blow due to the global economic downturn. RDB officials said that, export earnings in the last two months of this year fell by 35.43 percent and 46.53 percent in value and volume respectively. A survey done by The Business Times reveals that two slaughterhouses in Kigali have rotting stocks of hides worth about Rwf80 million. Officials of Satra Abattoir in Kicukiro district said that the rotting stock is estimated to be worth Rwf40 million. According to the dealer, the hides and skins remain unattended to because of government’s ban on the exportation of unprocessed (valued added) hides. The proprietor of Satra Abattoir, Rugondo Mugabe said, “There has not been any exportation because of the ban while stocks are heaping day-after-day. Even the processing investors like Rwanda Leather do not have the capacity to buy from us yet my contracts in Asia have expired after my temporary permit was cancelled.” “Government is losing a lot of money but we are affected the most because most of our businesses depend on loans that we are supposed to pay or face confiscation of property,” he lamented. Mugabe explained that though he is willing to add value to the hides but the cost of investment estimated at $2 million for a ternary is high. A ternary is a place where hides and skins are treated for value addition. “It would be of great importance if government established a ternary, which we could use at a fee,” he suggested. Impu-Mahiu, located near Rwandex Coffee Factory in Gikondo, is a warehouse for hides and skins as well. Though Rwanda Leather Industries acquired some machines, the company’s capacity is said to be low. Government has scheduled more support in the form of training aimed at improving the quality and quantity of hides and skins. A hides and skins demonstration centre will also be established next year in Kabuga to improve on the quality. According to John Ndikuwera, Head of Agri-business Department in Support to Small and Medium Enterprises in Rwanda (CAPMER), the centre will be charged with checking defects on hides and skins for export. CAPMER is among the institutions which were recently merged to form the RDB. The demonstration centre is under the huge financial and technical support of the United Nations Industrial Development Organisation (UNIDO). Ends