MINICOM begins district consultative sessions to validate new National Cross-Border Trade Strategy
27-30 Aug.2012- Stakeholders involved in cross border-trade met in Rubavu and Rusizi Districts with the Minister of Trade and Industry, François Kanimba, and representatives from the Ministry to discuss the new National Cross Border Trade Strategy.
In his opening remarks, the Minister said that the vision of the Cross-Border Trade Strategy to bring about dynamic and diversified trade with neighbouring countries, creating jobs and income in both the formal and informal sectors and improving the trade balance. “The strategy is closely aligned with the Trade Policy Mission of growing sustainable and diversified products and services for trading locally, regionally, and internationally, with the aim of creating jobs, increasing incomes and raising the living standards of Rwandans.” Minister Kanimba said. As the majority of this trade is conducted by women traders, the strategy has a strong gender focus.
According to BNR and RRA Trade Data the DRC is Rwanda’s largest regional export market. In 2011 an estimated Rwf 41 billion was exported to DRC both formally and informally. Exports to the DRC accounted for close to 70% of total formal cross border exports and almost 80% of informal exports. Burundi is Rwanda’s second largest cross-border market accounting for Rwf 8 bln in 2011, while exports to Uganda were Rwf 5 bln and exports to Tanzania were under 0.7 bln. As much as 74% of all cross-border trade is conducted by women traders, highlighting the importance of the strategy from a gender perspective.
Rwanda’s informal exports are mainly food and livestock. Both unprocessed and processed food accounted for approximately 50% of informal exports between 2009 and 2011 while livestock is accounted for 26% of exports over the same period.
During both meetings, traders stressed the point that they are limited by lack of finance to increase their trade. Minister Kanimba urged banks to facilitate cross border traders by lending to traders. Other challenges identified in the strategy and validated during the meetings included the poor application of rules and procedures by border officials, often not on the Rwandan side of the border, and inadequate or inappropriate market and storage infrastructure. These constrains make it more expensive for traders to trade and limit the supply in cross border markets. The issue of support to trader cooperatives, and particularly women cooperatives was also highlighted. An important issue to emerge during the meeting was the importance of a coordinated approach by the Government in the area of cross-border trade support. There is much already being done by the Government to support this trade but the information on these initiatives is not being adequately passed down to traders. The Minister thanked participants for their comments and said the strategy would reflect their concerns.
The Cross-border Trade Strategy emphasises a market led approach to growth in exports through initiatives to support the realisation of Rwanda’s true cross-border trade potential. Among other initiatives in the strategy that will have a direct impact on the private sector: Reduction in barriers to trade with neighbouring countries; Increased information availability and increased awareness of opportunities for trade with neighbouring countries; Improved access to finance for small traders and increased opportunities for trade; Stronger linkages between producers and firms in Rwanda and markets in neighbouring countries; Suitable markets to meet higher volumes of trade and traffic.
The strategy was developed by MINICOM with support from Trademark East Africa, a regional trade programme. The strategy will have its final validation meeting in Kigali on the 13th of September 2012.