Local manufacturers have unveiled a three-year strategic plan aimed at enabling the manufacturing sector to cut production costs, become more innovative and improve the quality of local products.
It is envisaged that this will subsequently increase productivity, increase competitiveness of local products in local and foreign markets and boost the sector’s contribution to national Gross Domestic Product (GDP).
Manufacturing currently accounts for only 19.2 per cent of GDP (the value of goods and services produced in the country), but analysts say it could do better with improved efficiency and exploitation of untapped opportunities in areas such as construction materials, pharmaceuticals, chemicals and chemical products.
More avenues to broaden the manufacturing sector have been reported in electronic and electrical equipments, packaging and paper products.
The plan, developed with support from Trade Mark East Africa, positions manufacturers to engage authorities in the energy sector, Rwanda Revenue Authority, the Ministry of Trade and Industry and the Private Sector Federation in discussions on how to reduce production costs.
Top on the agenda will be the cost of water and electricity, taxes on raw materials, high cost of transport, access to market and competition from imports, said Anne Rwigara, the secretary general Rwanda Manufacturers Association.
“Bringing together different stakeholders in the value chain of production will lead to reduced cost of production,” says Robert Bayigamba, the association president.
During the launch of the plan last week, manufacturers also used the occasion to sign statutes committing themselves to the goals of the strategy and most importantly assist the association attain a legal status.
“We have been operating under the old statute, despite the fact that we now operate under a different name and different laws. Therefore to make the organisation a legal entity, we are adopting a new statute which members must sign before being approved,” Rwigara said.
The strategy provides a platform through which manufacturers will receive updates on relevant issues that will enable then constantly enhance productivity such as environmental regulations, market information and innovative transfer of technology.
Bayigamba added that the plan will encourage and assist in the implementation and use of new technological processes and programme for improved and sustainable services.
“We want to work proactively and improve the profitability and competitiveness of members, associations and all other stakeholders involved. This, we are confident, will drive the country towards economic sustainability.”
Chantal Umuraza, the executive director, Chamber of Industries, said that the strategy will initiate and promote cooperation between manufacturers, their clients and customers and most importantly bring on board innovations to make Rwandan products.
“We are looking at working on a strategy that will see manufacturers come together in promoting ‘Made in Rwanda’ products. This can only be achieved if we work together and not as individual manufacturers.”
Duack Eckardt, the board chairman Strawtec Building Solutions said, the strategy clearly defines the roles manufactures and stake holders must play towards transforming Rwanda’s industrial sector.
“Its timely and aligning its self with government’s EDPRS2 objectives which will drive the economy towards sustainability.”
Manufactured exports accounted for 45 per cent of Rwanda’s non-traditional exports last year from 36 per cent in 2011.
Growth has been witnessed in milling (by 337 per cent) and brought into the country $15.7million in 2012. Beverage exports have also increased by about 153 per cent fetching about $10.7million in exports while steel exports have since 2012 grown by over 185 per cent and raked in $3.8 million.
Plastics, soaps and washing detergents manufacturing also witnessed growth over the past year, but the association says more work needs to be done in the area of branding and general innovations to improve quality of local products. This, according to the strategic plan, will be achieved by identifying more innovative technologies through training, collective branding under “Made in Rwanda” and export promotion strategies.
It is hoped that this will ensure transforming from traditional means of production to more modern and internationally accepted methods of production, Rwigara said.