Eastern Province SMEs decry electricity shortage

Small and medium enterprises in Eastern Province have decried low electricity penetration as one of the biggest hindrances to their operations and growth.
A participant contributes during the meeting. Kelly Rwamapera.
A participant contributes during the meeting. Kelly Rwamapera.

Small and medium enterprises in Eastern Province have decried low electricity penetration as one of the biggest hindrances to their operations and growth.

Speaking during an interactive session with Rwanda Development Board officials, the investors said low electricity penetration, especially in rural areas, has negatively impacted production.

For instance, Mericiana Uwamwezi, from Rwimiyaga Sector in Nyagatare District, said her pineapple juice plant cannot meet demands due to electricity shortage.

“Last year, I got a bigger market to sell my dried pineapples in Switzerland but because I don’t have electricity, I was handicapped,” said Uwamezi.

In the latest release of the World Bank Doing Business report, getting electricity was ranked among the lowest indicators for Rwanda, featuring at position 119th. This is largely due to the time taken to access electricity upon applications.

In response to the challenges, RDB chief operations officer Emmanuel Hategeka said the Government is working to address the challenge in the coming days as part of the doing business reforms.

As part of the intervention, Rwanda Energy Group is working on five new reforms to be implemented by May next year.

The Government also seeks to reduce the time for connection from the current 34 days to 20 days as well as revising tariffs to introduce preferential rates for productive users.

Rwanda Energy Group is also working on a system that will monitor outages and record frequency and durations of power outages so that it is predictable for people running factories.

Other reforms under the indicator include introducing electricity quality service codes and reducing the cost of connection.

Hategeka noted that the ongoing amendments are tailored as per investors needs and suggestions and will also improve the global doing business rankings.

The forum also served to showcase incentives for investors especially in exports promotion.

RDB’s head of investment promotion Winifred Ngangure said companies can get up to a 50 per cent tax exemption when they export 50 per cent of their products.

“It’s possible for a company to be exempted of taxes up to 50 per cent when exporting 50 per cent of their products,” she said.

The Government is in the process of incentivising exports as international trade has proven effective in reducing trade deficit.

Rwanda’s trade deficit narrowed significantly in the first six months of 2017 by over 25 per cent compared to the corresponding period last year.

Trade deficit in the first half of the year stood at $671.2 million compared to $902.3 million in the same period last year.

The provincial executive secretary, Kizito Habimana, called on the private sector to cooperate for investments.

“There are some opportunities that require mega investments which a single individual may not be able to uphold. I would ask the private sector to bring together their hands for mega investments,” said Habimana.

editorial@newtimes.co.rw