The Rwanda Country Programme

The Rwanda Country Programme

Advancing Trade, Improving Economies

Overall Programme Overview

CHALLENGE

Rwanda, a landlocked country, depends on East Africa's North and Central Corridors to import and export goods. Moving a container from either Mombasa or Dar es Salam Port to Kigali would cost almost US$5,000, and would take approximately 30 days in 2012.

This made Rwanda one of the most expensive countries in Africa for both businesses and consumers

RESPONSE

As part of a broader trade facilitation effort to enable Rwanda become more "land-linked" and increase its competitiveness, TradeMark East Africa (TMEA) supported the government of Rwanda and private sector players to undertake various interventions that would contribute to reducing the cost of trading across borders. Interventions included the following: supporting Information Communication Technology (ICT) interventions that reduce the time it takes to clear imports and exports; support to improving standards of goods for export; improvement of key infrastructure along the corridors to enable faster exit and entry of goods like construction of One Stop Border Post at Kagitumba, and removal of key Non-Tariff Barriers.

The Rwanda Country Programme

Overall programme results

  • US$65 M

    2010 - 2016 Budget

    2010 - 2016 Budget

  • US$100 M

    Amount of trade induced by key TMEA Rwanda projects

    Amount of trade induced by key TMEA Rwanda projects

  • 15%

    TMEA target on reducing transit time across borders.

    TMEA target on reducing transit time across borders.

Elimination of Non-Tariff Barriers to Trade

Response

The intervention sought to lobby for the removal of Non-Tariff Barriers. TMEA supported National Monitoring Committees on Non-Tariff Barriers (NMCs on NTBs) to identify and lobby for resolution of NTBs. The intervention was multi-pronged including evidence-based research to collect NTBs, online reporting system and raising awareness amongst key stakeholders like cross border traders, truck drivers, police etc. The NTB elimination project contributed to reducing the time taken along the corridor, thus complimenting other projects with similar aim like OSBP's, electronic Single Window and port modernisation programmes.

Results

  • Amount by which elimination of key NTB's like police road blocks, surplus weighbridges contributed to reducing cost of transporting a standard (40 foot) container from Mombasa to Kigali.

    US$6,500(2011) - US$4,800(2015)

  • Estimated savings to have been generated (at constant volumes) on the Mombasa-Kigali route alone due to elimination of NTBs

HARMONIZATION OF ROAD TOLLS

  • 69.6%

    Findings from the "Rwanda Road Freight Industry Competitiveness Study 2014" informed policy makers to lobby for the reduction of road tolls of Rwandan trucks entering Tanzania from

    US$50 - to US$152.

  • US$800,000
    ANNUAL SAVINGS

    Annual savings by Rwandan transporters as a result of advocacy efforts that resulted in Tanzania reducing the road toll.

KEY LESSON

Targeted sensitisation and training of stakeholders like small and medium sized traders will increase the reach of intervention such as NTB reporting systems and increase reporting of NTBs.

IMPROVED QUALITY STANDARDS

IMPROVED QUALITY STANDARDS

RESPONSE

The programme supported the Rwanda Standards Board to procure and install lab equipment that led to increasing its ability to test more elements. It also supported the training of staff, review and adoption of standards policies, creation of quality and standards awareness amongst producers and consumers.

RESULTS

  • Modernisation of laboratories

    Cost reduction on testing

    US$500 - US$250

    Time reduction on testing

    60 days - 8 days

  • As a result of the capacity built at RSB and the private section

    Enterprises dealing in food and beverages have been certified.

One of the major achievements from the technical assistance was upgrading and preparation of the laboratories for accreditation for international recognition, meaning Rwanda Mark of Quality WILL BE internationally recognised, hence, products bearing the mark of quality WILL NOT require further tests in international and regional markets. That WILL reduce cost of Rwanda goods and increase their competitiveness. MarketShare Associates

KEY LESSON

Awareness creation on quality, standards and the role of National Standards Bureaus (NSBs) in trade facilitation eliminates the mistrust between the business community and the NSBs. The lesson learnt is that this leads to increased transparency and cooperation among the stakeholders and the NSBs which leads to more access to the conformity assessment services such as testing and certification hence producing quality products that meet standards and are able to access markets.

Rwanda Electronic Single Window (ReSW)

electronic-window

RESPONSE

Reduce administrative processes in clearance of imports and exports. Upgrading the Customs Management System and introducing an Information Technology Single window so that all users( e.g. government agencies freight forwarders, banks) in the customs clearance process are linked into one web based information portal for ease in clearance process.

RESULTS

  • resw
  • resw
  • resw

REDUCED RELEASE TIME FOR IMPORTS

Thus greater predictability for businesses, improved planning, increased efficiency and trader confidence.

POSSIBLE LONG-TERM IMPACT

  • $8.7 MILLION

    The future growth of Rwandan export potential

  • EXPORT DIVERSIFICATION

    Expanded range of products due to greater trade facilitation provided by the ReSW; more products to export

Possible long term
  • 100%

  • For importers, the introduction of ReSW reduced the cost of clearance and obtaining exemptions from US$ 37 (RWF 30,000) and US$4.9 (RWF4,000) respectively, to close to zero in 2014.

KEY LESSON

Reform efforts should focus on all agencies involved in regulating trade flow, meaning the will not only work on customs but also on other border management agencies, such as police, immigration, etc.

women in trade

WOMEN AND TRADE

RESPONSE

Targeted support to 3,000 women informal cross-border traders to increase their ability to trade across-borders and consequently increase incomes. Supported formation of cooperatives and transformation from informal cross border trade to formal cross-border trade. Programme aimed to highlight the challenges faced by women traders in order to inuence policy at national level.

RESULTS

  • US$ 123

    Average women trader in a profemme programme now trading US$ 123 (Rwf 100,000) versus women outside the programme trading Rwf 84,000.

  • 28%

    Of cross border traders under the project have recorded improvement in nutrition, access to health insurance and ability to pay schools fees for their children.

  • $100,000

    15 of the supported 25 cooperatives have secured loans worth US$100,000 to expand their businesses

MINEAC (Ministry of East Africa Co-operation)

RESPONSE

Targeted support to MINEAC on Regional Integration (RI): programme focused on building capacity of MINEAC through implementation of a communications strategy to increase understanding of EAC, development of monitoring and evaluation systems to track implementation of Common Market Protocol, impact assessment on EAC regional integration with the aim of communicating anticipated opportunities for Rwandans, technical assistance consultants and a young professional programme that builds capacity of fresh graduates on RI, and awareness raising of both public and private sector on RI.

RESULTS

Key Lessons And Recommendations

Partnership: Leveraging the resources of government and development partners to supplement TMEA's own investments is an important sign of local buy-in and ownership. It also supports access to additional technical capacity.

Sustainability plan: Sustainability has multiple aspects in trade facilitation programmes; while capacity building and institution building are very important, developing a sustainability plan that includes a realistic expectation of needed nancial resources is critical. This should be considered from the design phase.

Quick win interventions: TF programmes should consider expanding interventions that provide information and capacity development on, and physical and process support to access, export potential, export markets, standards, and other processes and requirements to export goods and services producers. Such projects have an obvious link to household-level welfare enhancement.

Focus on entire system: Future Trade Environment projects should consequently invest in projects that will impact the entire system and all actors.

Invest on assessing impact on poor: It is important trade facilitation programmes check that the assumed relationship between lower transport costs and reduced poverty is valid and generate learning in this area so as to demonstrate return on investment.

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