Marketing and value addition the way to go for Rwanda’s exports

A Turkish business delegation lands at Kigali International Airport seeking business opportunities in Rwanda. Photo/Cyril Ndegeya  Nation Media Group

Rwanda is almost a net importer of essential commodities in all aspects of the economy and the high trade deficit is attributed to this phenomenon.

The country’s aggressive efforts to break into the East African Community market have yielded little as imports have continued to rise while it looks to Burundi and the Democratic Republic of Congo for her exports.

However, for a developing country like Rwanda to cut down on aid dependency, its focus should be on increasing export revenues. Rwanda’s progress in this line in the past decade has been slow, partly due to lack of value addition.

Rwanda’s industrial sector, a key driver for economic growth, is projected to grow at an annual rate of 14 per cent by 2020.

The government has in the past year been lobbying to win the Turkish market.

With the high-level business delegation led by President Paul Kagame himself, there were signs of a breakthrough with interest from Turkish consumers although Rwandan traders are yet to supply the market.

The ball is in Rwandan traders’ court, and the million-dollar question for Rwanda is whether the country has got a competitive edge on the global market against the big industrialised economies.

Some Rwandan commodities that have already made it to Turkey, such as pineapples, minerals and cassava starch need more value addition if they are to be well received on the competitive global market. That will require heavy investment in machinery, which is still a challenge to the Rwandan industrial sector.

With limited capacity to improve the quality of exports, one is left to wonder if the country is able to meet the required demand regionally and globally. With exception of a few manufacturing exporters eyeing the Turkish market, the Rwandan private sector is still resource-crippled and therefore most exporters sell raw or unfinished products.

The government has been supportive. For instance, washing stations have been established to export semi-finished coffee and tea products and the two products are among the country’s leading foreign exchange earners.  

But to successfully break into the international market also requires a concerted marketing strategy for products to compete globally. In export diversification, the country, rather than individual exporters, need to internationally market other potential products alongside traditional cash crops.

The local private sector is one of the smallest in the region and this makes it incapable of solely going global,
 so a lot more than finding the market for the products is needed.

The Rwanda Bureau of Standards should also be alert to ensure international standards so as not to compromise the products’ competitiveness.

Since it cannot compete in terms of volumes with large producers of some products, Rwanda can only capitalise on the quality of its exports.