[PHOTOS]: Businesses tipped on available funding options to boost expansion of exports

Rwandan entrepreneurs will need to get informed and apply for existing funding opportunities, if they are to take their businesses to the next level, François Kanimba, the minister for trade, industry and East African Community affairs, said yesterday. Speaking in Kigali during the first national conference on the role of women in socio-economic development in the East African Community (EAC), the minister particularly singled out the Export Growth Fund (EGF) managed by the Development Bank of Rwanda (BRD) as being under-utilised. “We held many meetings with people involved in export business and they were delighted but what amazes us is that this rejoicing ended in meeting rooms,” Kanimba said. “We wait for people to come forward to use the fund but none comes up. This is a problem; I fought hard to see this Fund set up but now we have to explain why it is not used.” EALA MP Oda Gasinzigwa speaks during the meeting in KigalI. Responding to queries from the audience over high interest rates that purportedly smother start-ups, Kanimba explained that the Fund was established to help exporters get around such obstacles. If a bank gave an entrepreneur a loan at a 17 per cent interest rate, for example, he said, the Fund would chip in 6.5 per cent to ease things for the entrepreneur. The Fund is designed as a single facility with three separate windows including an investment catalyst fund providing subsidies on the interest rate of loans targeted toward private sector investments in export oriented production. Eugenie Nshimiyimana, chairperson of the chamber of women entrepreneurs, reacts to a question during the meeting. Then there is the matching grant fund for market entry related costs: matching grant to firms investing in activities specific to exporting that are not necessarily a consideration when not exporting; and the export guarantee facility, to provide transaction-related guarantees to commercial banks to securitise export finance transactions up to 80 per cent of value. Eugenie Nshimiyimana, chairperson of the Chamber of Women Entrepreneurs, said women entrepreneurs, in particular, are not readily informed about such initiatives. “There is a lack of information but now, for example, the few women here who have learned about the fund will inform many others,” she said. Guests together with participants pose in a group. Fast-track, expand exporters businesses According to Benjamin Manzi, the head of export financing at BRD, the EGF, introduced more than a year ago, aims to help to fast-track and assist local exporting firms to expand their business by providing finance. Manzi said the matching grant fund for market entry-related costs offers up to 50 per cent grants to cover genuine budget costs “but not more than $100,000 for anyone” who wants to penetrate the international market. “We are targeting SMEs and the minimum we can give is $50,000 and the maximum is one million dollars but the Ministry of Trade, Industry and EAC Affairs is looking into how it can increase to about five million dollars so that they can tap the big exporters,” he said. Martine Umubyeyi, Principal of LaColombiere School speaks during the EAC meeting in Kigali. According to Manzi, what many local entrepreneurs need to know is that with EGF support, the interest rate would shrink from the standard commercial banks’ rate of 18 or 19 per cent, to 14 per cent. “With a direct subsidy from government when they are working with BRD, it can even go as down as 10 percent as long as you are investing in long term financing and you are setting up infrastructure for export,” Manzi added. If an entrepreneur builds an industry that will increase products, and exports as well as employ more people, “rather than looking for working capital,” they stand a good chance to benefit from the EGF. EALA MP Dr James Ndahiro (R) speaks during the meeting as Permanent Secretary at MINEACOM, Innocent Safari looks on. The principle objectives of the facility, Manzi explained, are: to broaden the range of financial services of Rwanda’s formal finance sector; to facilitate access of export-oriented SMEs (with a turnover ranging between 50,000 to $1 million) with growth potential to tailored export finance products and services; and to provide access to finance at competitive prices for export-oriented SMEs. The EGF also aims to improve knowledge of SMEs on export related finance through technical assistance; and improve knowledge of finance institutions on export-related financing instruments and related business appraisal. The symposium, under the theme, “Strengthening Women Participation in EAC Integration to Ensure Sustainable Socio-Economic Development,” was held in collaboration with institutions such as the National Women’s Council. Participants sing during the first national conference on the role of women in socio-economic development in the East African Community. It sought to mobilise associations of women in business and women in EAC cross border trade to aggressively tap into opportunities provided by regional integration. Under the EAC Treaty, partner states are obliged to enhance the role of women in socio-economic development. Women constitute over 60 per cent of the EAC population and 52 per cent in Rwanda. The Permanent Secretary at MINEACOM, Innocent Safari answers a question during the meeting. editorial@newtimes.co.rw

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[PHOTOS]: Businesses tipped on available funding options to boost expansion of exports