Cross border trade receipts surge

Trade between Rwanda and her neighbours increased significantly in the fist half of this year, creating a positive outlook for the country’s exports needed to offset her trade deficit.Rwanda generated Rwf21.9 billion from formal exports to neighbouring countries including Burundi, DR Congo, Uganda and Tanzania as formal import bill reached Rwf162.4 billion, according to figures from the central bank. On the informal basis, which is the main driver of Rwanda’s cross border trade, export revenues rose by 14 per cent to Rwf33.2 billion while imports increased by 1 per cent to 11.5 per cent. “The diversity of products Rwanda exports to neighbouring countries is far greater than to any other region of the world,” the Minister of Trade and Industry, Francois Kanimba said.The Minister said that Rwanda’s exports to the region are approximately 10 times more diverse than those to her non-regional export market.In the period under review, Rwanda traded 47 per cent of her merchandise exports through formal means, signalling a steady shift from an agricultural dependent export sector. According to Kanimba, cross-border trade plays an important role in poverty reduction as it provides trading opportunities for many poor folks, mostly marginalised communities—in this case women—around the borders. Rwanda’s cross border export products include agricultural goods, livestock, meat and dairy products, processed food and manufactured goods ranging from cement, beauty products and beverages.Accordingly, limited access to finance, poor infrastructure such as storage facilities are some of the factors that still weigh down on the hamper this trade.Moreover high costs and the long hours needed to clear cargo at border posts increase the cost and reduces demand for exports in cross-border markets. Often barriers are not based in legal regulation, experts say.Sylvere Mudendeli, Chief Executive Officer (CEO) of Rwanda Organic Agriculture Movement says that most organic products from Rwanda have no access to most markets since they cannot fulfil requirements such as standards and packaging.“What we are trying to do is to see how we get certification of our important markets, otherwise there is no way we can promote exports without working on our standards,” he said.Meanwhile the Ministry of Trade and Industry has designed a cross border trade strategy aimed at addressing the prevailing challenges to cross border trade. Kaliza Karuretwa, the Director General in charge of Investment Climate in the Ministry of Trade and Industry says that the strategy will reduce cost of crossing the border, improve competitiveness of Rwandan goods in neighbouring markets and increase export volumes.“Through this strategy, we will see how we Construct market and storage infrastructure in Cross border trade districts that meet the needs of informal traders and can accommodate high volumes of trade,” she said . She also adds that there are plans to improve information availability for producers through Cross Border Trade mainstreaming into e-soko market information system, linked to Trade Information Desks.

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Cross border trade receipts surge