Exports grow by 33.2 percent

Rwanda’s export receipts in eight months have grown from $204.6 million (Frw112.8 billion) to $306.7 million (Frw169.1 billion), Rwanda Investment and export promotion Agency has said (RIEPA).

Rwanda’s export receipts in eight months have grown from $204.6 million (Frw112.8 billion) to $306.7 million (Frw169.1 billion), Rwanda Investment and export promotion Agency has said (RIEPA).

According to RIEPA, the 33.2 percent increase in export revenues is mainly due to government intervention in the sector by allocating significant resources to spur export development.

RIEPA also introduced the Rwanda Competitiveness Fund (RWACEF) and export guide, to further help the country realise increase in export.

It is a new scheme to help private companies that operate in Rwanda, improve their competitiveness in export markets.

The scheme helps Rwandan private companies to hire consultants and obtain other services that will help them diversify, improve and expand their product lines.

Statistics show that tourism, coffee, tea, minerals and handcrafts are the highest foreign exchange earners.

Export earnings from handcrafts in particular increased by 109.3 percent to $526,992 (Frw289.1), making it the most improved sector as there are better organised. 

Most of the weavers and exporters have formed associations rather than individuals doing the same work, rivaling each other yet with a common goal.

On the international market, Rwandan handicrafts especially the peace basket is fetching high ranging from $150 (Frw82,285) to $400 (Frw219,428). Locally, the baskets cost Frw7,000 on average.

In eight months tourism raised $137.7 million (Frw75.9 billion) compared to $88.8 million (Frw48.9 billion) in the same period last year.

The sector has been regarded as the fastest growing in Rwanda in the recent years, surpassing coffee and tea industries.

Last year, tourism industry emerged the top foreign currency earner generating revenues worth $42.3 million while coffee and tea industries earned $35.7million and $31.5million respectively.

These developments are attributed to the introduction of new arrival and departure forms at entry points like Kigali International Airport and land borders to improve on tourism statistics.

With these new forms, Office of Tourism and National Parks (ORTPN) can easily collect actual data of tourist arrivals.

The agency can also identity how much money and time they spend in the country.

Rosette Rugamba, the Director General of ORTPN attributes the increasing number of tourists in the country to improving facilities and investments in the sector valued at $78 million today.

She said that hotel rooms have increased from 3,268 last year to 3668 this year.

Rugamba also explained that the introduction of other tourism attractions such as bird watching and mountain climbing have also fetched in more revenue.

Adding that there have been aggressive marketing of tourism packages which has seen the number of package sellers increase from seven in 2005 to 40 today.

The Rwanda tourism sector is expected to raise $148 million from 884,220 international tourists this year, making it the country’s top source of direct foreign earning.

Coffee which almost faced extortion decades ago earns 42.04 per cent above last year foreign earnings of $18.5 million in the first eight months.

This is justifiable with its first half earnings of $15 million this year.

Ocir-café, the government-owned coffee supervising body said the increase is because of the timely application of fertilisers and pesticides, mulching and pruning by farmers.

Alex Kanyankole, the Director General of Rwanda Coffee Authority (Ocir—café) said that the attractive prices offered to the farmers also played a role.

However Ocir—café’s sales target is $50.9 million, an increase from last year’s total sales of $30.2 million and is expected to be generated from 28,000 tonnes of coffee.

Though the Ocir—café is $10 million shy of meeting half their goal in the first six months of the year, Kanyankole said he is optimistic that the authority will meet its target by the end of the year saying that much output and revenue will be generated towards the end of the second half.

Tea earnings have significant increased by 34.6 per cent form $29.8 million to $22.1 million

The increase has been attributed to the high demand of tea at the Mombassa auction market and the rise of prices on the international market.

Dealers who used to auction coffee at $1.71 (Frw936) per kilogram, last year, are now earning above $2.29 (Frw1,253) per kg.

Ocir-The says the good quality of Rwandan tea has also pushed the prices up despite a decline in production by 4 percent.

The country produced 10.881 tonnes of processed tea, valued at $26 million (Frw14.2 billion) between February and June this year.

But last year, during the same period, only 11.500 tonnes worth $18 million (Frw9.8 billion) was exported.

Other tea market players however say, Rwanda is cashing in on the low supply of tea on the Mombasa auction following Kenya decline in production early this year due to harsh weather conditions that hit tea producing areas.

Kenya is the leading tea supplier at the Mombasa auction market.

Pyrethrum and horticulture recorded the worst foreigner earning from exports.

Despite the potential to generate substantial export earnings, pyrethrum production has not been fully exploited.

The cash crop’s earnings have dropped from $ 2.6 million to $0.38 million, an 85.3 per cent decline.

The Northern Provinces of Ruhengeri and Gisenyi provide suitable climatic conditions for the development of this crop but no intensive planting has been embarked on.

Vincent Karega, State Minister for Industry and Investment Promotion said that the decline in pyrethrum is because of the restructuring of Société de Pyrèthre au Rwanda (SOPYWA), the only pyrethrum factory, for value addition.

He was however optimistic that by the end of the year, production will have increased thereby realizing a further increase in exports.

Horticulture sector that includes bananas, fresh fruits and flowers recorded a 61.6 per cent decline from $0.34 million down to $0.13 million.

Rwanda Horticulture Development Authority (RHODA) attributes the fall in export revenue to the low value of horticulture exports saying it does not attract much demand on the international market.

Karega however said that the horticulture sector lacks sufficient investment to spur great export levels.

Information from RHODA show that only five local exporters produce for international markets.

They include, East African Growers, which exports French beans, Rwanda Flora—exporting flowers, Floris— sweet bananas, Shekina and Sorwatom which exports vegetables.

Rwanda is targeting $425.5 million (Frw234.5 billion) in exports by 2012.

Last year the county’s exports were $202 million (Frw111.6 billion) but government plans to increase the figure to $234 million (Frw129 billion) this year.

As part of its drive to promote exports, Riepa held a session with exporters.

Francis Gatare, the Director General of Riepa explained that the meeting was timely as exports are crucial for economic development.

Its is hoped that with an export driven economy, the Economic Development and Poverty Reduction Strategy (EDPRS) will be achieved.

Gatare said that dialoguing is vital for having a common understanding amongst stakeholders.

“It helps set realistic export targets, address export barriers and underscores incentive packages that help to increase exports,” he explained.

Rwanda’s natural resources are limited. However, a small mineral industry provides about 24 percent of the total foreign exchange earnings from $45.1 million to $68.8 million, with minerals such as Cassiterite (tin), Wolfram, tungsten, columbium and Coltan.

In its Vision 2020, government identified the mining as a priority sector that would enable it diversify its export base.

Government injected Frw12.5 billion in the sector for 2008-2010, in order to strengthen its regulation, avail new data to interested investors, support value addition to metallic ores and quarries, and into the sector consolidation and sensitisation programme.