Young entrepreneurs involved in the production of Made-In-Rwanda products have said that the cost of importation of raw and packaging materials continue to drive up the cost of the end products.
The challenges were expressed by emerging entrepreneurs during a recent visit by officials from Rwanda Development Board, Ministry of Trade and Industry to a local exhibition in Kicukiro District.
The entrepreneurs told Business Times that they often face a challenge of access to raw materials such as hides, leading them to have to import them at high cost, which pushes up the cost of their products..
"We import tanned skins because even the few ones produced locally are expensive and often of inferior quality. We import most of the tanned skins from Tanzania and Kenya. It becomes expensive because one has to do it through importers,” said Maritha Nyiramasabo, a shoemaker in Kicukiro District.
Producers say that locally made shoes are still expensive due to costly raw materials. Photo by Michel Nkurunziza.
One piece of quality finished skin costs around Rwf 2, 500, she said adding that most components of a shoe including a heel are imported.
Jean Claude Nizeyimana, said that quality shoe prices remain high arguing that they require quality raw materials which often come at higher prices consequently impacting cost of the final product.
Producers have also decried high cost of packaging materials for some products especially those in agro-processing industries saying that it leads to high prices of end products.
Layce Kwizera, who runs a firm that produces liquor, and wines from honey, fruits and banana beer, said that out of lack of option they are still importing bottles for packaging.
"There is no local factory that produces bottles. We want the government help us to attract investors in packaging manufacturing so that we can have an alternative to importing them at high cost,” she said.
The company, which started in 2014, currently produces 200 cartons of assorted beverages per day and each carton contains between 25 and 50 bottles.
Clare Akamanzi, the Chief Executive of Rwanda Development Board (RDB), said that the issue of raw materials on local market is still a challenge but noted that going forward there will be more skin tanning factories in the country.
"We have enough skins in the country but the capacity of local factories to process them is still low. However, we are in dialogue with different investors in raw and packaging production to come in. We are also supporting the existing leather factory to improve the quality of tanned skins. It is a long journey, but will eventually be successful,” she said.
She urged the young entrepreneurs to strive to produce many and quality products and pledged to link them to markets.
"Produce as many products as you can and then it will be possible to reduce prices on them,” she told the youth in private sector.
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