Rwanda needs to promote consumption of locally manufactured products as the key to youth job creation and addressing the country’s trade imbalance, lawmakers said.
Members of the Senatorial Standing Committee on Economic Development and Finance said Made-in-Rwanda products should be supported so as to be competitive enough to help accelerate the country’s economic development.
The senators made the remarks Friday as they began a three-week tour to evaluate industrial zones in the City of Kigali and in several selected districts in the countryside.
They started by visiting the Kigali Special Economic Zone in Gasabo District.
Other districts to be visited include Musanze, Rubavu, Rusizi, Muhanga, Huye and Nyagatare, Nyabihu and Bugesera.
Senator Celestin Sebuhoro, the Committee Vice-Chairperson, said the tour is intended to assess the status of industrial zones in the City of Kigali and in the countryside.
In Kigali, senators visited manufacturing companies including strawtec Ltd, which manufactures construction materials (panels) from wheat stems (straws); PharmaLab, which produces medical equipment, and Sahasra Electronics (Rwanda) PVT. Ltd, which produces energy-efficient lights (LED); as well as C&H Garment, which manufactures clothes.
Sebuhoro commended the progress at the Kigali Special Zone, including the tarmac roads network that eased access to the facilities in the area, street lights, electricity and water infrastructure.
He noted that the Government established the special economic zone in a bid to have an appropriate area for industries.
Giving Made-in-Rwanda products a priority
The legislators called on Rwandans and public entities to prioritise Made-in-Rwanda products.
Senator Bizimana said that Rwandan products enjoy preferential treatment under revised procurement law.
Even where an imported product costs 15 per cent cheaper than a Made-in-Rwanda product, the latter will be considered, he said.
PharmaLab’s Commercial Director, Cyriaque Rugwizangoga, said the company invested $5 million (over Rwf3.5 billion) in 2015 for the first phase of its medical production project.
It is currently producing 25 million blood tubes and five million urine and stool containers.
“The country’s demand for blood tubes is estimated at ten million while that of urine and stool containers is about 3 million,” he noted, adding that the East African region’s demand for blood tubes is about 60 million.
In June, the company said it will be selling its products to Rwanda Biomedical Centre. Before, Rwanda was importing similar products.
One hundred blood tubes are sold at between Rwf4,500 to 5,500 depending on the type; while one urine or stool container costs Rwf80, according to information from PharmaLab.
Cécile Nkomeje, PharmaLab Managing Director, said they will start to produce syringes, and probes (blunt-ended surgical instrument used for exploring a wound or part of the body) of various types in the second phase of the project.
Meanwhile, Sahasra Electronics (Rwanda) PVT. Ltd produces about 60,000 lamps per month which include bulbs for indoor use and streetlights for outdoor use. Its investment was $3.5 million.
For energy saving, the lamps are over 50 to 80 per cent energy-efficient than fluorescent lights, said Suresh Negi, the company’s operations general manager.
“Our products help to reduce energy consumption and by so doing, energy is saved,” he said.
He, however, said substandard products on the market kill their business.
Senator Chrysologue Karangwa asked the manufacturers to produce affordable and quality products which are competitive on the market.
However, manufacturers raised a number of challenges, including loan interest rates which are still high [at about 18 per cent].
The senators’ exercise will end on March 28 after which they will present their findings and recommendations to the senatorial plenary, according to Senator Sebuhoro.
The Domestic Market Recapture Strategy, developed in 2015 by the Ministry of Trade and Industry, identified areas that would save some $450 million per year in the medium term (representing 17.8 per cent of Rwanda’s import bill), if all measures to promote local production were effectively implemented.
The proposed areas include construction materials, textile and garments, pharmaceuticals, soaps and detergents, reagents, packaging materials, wooden furniture and insecticides as we as agro-processing
The contribution of industrial sector to the country’s Gross Domestic Product is currently 14 per cent, against the Vision 2020 target of 20 per cent, according to the ministry.