Sawmill East Africa is set to build a wood processing factory in Rwanda after it signed an agreement with the Government to harvest and manage four state forests in a deal aimed at adding value to the forestry sector, promote exports and reduce the country’s import bill on timber.
The agreement was signed yesterday between the Government, through Rwanda Development Board, the Ministry of Land and Forestry on one hand and Sawmill East Africa on the other.
Without disclosing the size of investment, Sawmill’s Chief Executive Officer, Agnis Magelinskas, said that the factory is currently under construction at Rwamagana Industrial Park and is scheduled for completion by end October 2018.
Government hopes that the factory will reduce the country’s import bill on furniture and other wood construction inputs such as ceiling boards and potentially ease property prices.
Under the terms of the agreement, the firm will have the rights to exploit the forests, produce furniture and other products as well as replant the forests.
Sawmill will manage, exploit and replant four forests in the southern part of the country in Rusizi, Muhanga and Huye.
The Chief Operating Officer of RDB, Emmanuel Hategeka, told The New Times that the deal is set to usher in ideal use of forest resources as part of efforts to reduce imports of wood products and furniture into the country.
Hategeka said that the agreement aims to serve Rwanda’s export promotion strategy to diversify and improve value addition and reducing imports.
The firm will seek to add value to the wood processing sector building on raw materials to have complete manufactured products.
The firm’s management said that the deal will transform the local forestry sector into a profitable wood products’ market for furniture, building materials for domestic, regional and international markets.
Sawmill East Africa will also be required to replant trees.
Magelinskas said that the firm will work with local carpenters and build capacities on production of various products and furniture. It plans to create some 400 jobs in its first year of operation.
However, some conservationist called on the Government and Sawmill East Africa to implement the deal with caution, arguing that harvesting the forests could derail the country’s ambitions of attaining its forestry coverage target of 30 per cent of the total surface area by 2020.
This means at least 714,102 hectares are expected to be forests reserves before the year 2020. There are more than 107 small size forests across the country.
Government in 2016 estimated that forest cover was around 29 per cent, from 25.9 per cent in 2010.
The Government’s target largely relies on agroforestry.
Hategeka allayed the concerns raised by environmental activists, saying that increasing forestry and conservation is one of the key contents of the agreement to ensure that gains made in recent years are consolidated.
The Minister for Land and Forestry, Francine Tumushime, said that previous efforts (in increasing forest cover) have laid a foundation for the initiative.
This is the second such agreement in the sector.
In 2011, New Forest Company signed an agreement with the Government to harvest Nyungwe belt reserve trees to produce fine timber and charcoal.