Rwanda boosting cross-border trade facilities

Rwanda boosting cross-border trade facilities
Rwanda boosting cross-border trade facilities

Africa-Press – Rwanda. The Ministry of Trade and Industry is urging the business community, mainly women cross-border traders, to use to maximum advantage the cross-border markets and one-stop border posts the country is establishing.

One of the new cross-border markets nearly complete is Kagitumba cross-border market, according to Richard Niwenshuti, the Permanent Secretary of the Ministry of Trade and Industry.

“Government invested a lot in constructing cross-border markets. So far, we have constructed 10 cross-border markets. There is also another market being constructed at Kagitumba border,” Niwenshuti said.

“The cross-border markets are constructed to facilitate small traders. Kagitumba cross-border will be completed by April next year if nothing changes in the plan.”

Cross border traders at La Petite Barriere, the border between Rwanda and DR Congo in Rubavu. File photo

Rwanda has different cross-border markets including two in Rusizi District, one in Nyamasheke, Burera, Rubavu and Karongi districts, in addition to the one being built at Kagitumba border.

“Rwanda has borders with three countries namely DR Congo, Burundi, and Uganda. There are huge opportunities in cross-border trade, especially on the border with DRC,” Niwenshuti said.

Petit barrier’ border post between Rwanda’s Rubavu district and the DR Congo’s Goma is one of the busiest borders in Africa with up to 90,000 people crossing daily, according to statistics by the Directorate of Immigration and Emigration of Rwanda.

Studies indicate that 74 percent of informal cross-border trade is conducted by women.

According to available statistics, cross-border trade with DR Congo amounts to an average of $100 million annually with approximately $30 million going through the Rusizi border.

In mid-2022, the Ministry of Trade and Industry launched two cross border markets in Western Province, in Rusizi and Nyamasheke Districts. These are the Bugarama cross border market situated at Bugarama-Kamanyola border in Rusizi district and Rugari cross border market in Nyamasheke district, to boost trade with DR Congo.

Experts say that if the African Continental Free Trade Area (AfCFTA) agreement is operationalized, trade value between Rwanda and DR Congo could increase by $56 million. Rwanda exported its first consignment of goods under the AfCFTA to Ghana on September 30. Neighboring DR Congo is a big market for Rwandan small traders as it receives 86 percent of goods from informal trade in Rwanda. In 2019, Rwanda exported goods worth $372 million to DR Congo which took 32 percent of all Rwanda’s total exports. However, this amount was reduced to $88 million in 2020 due to the Covid-19 pandemic that affected cross border trade but still DR Congo ranked second in receiving Rwanda’s exports.

Lake Kivu

The construction of four cargo and passenger ports on Lake Kivu was derailed by review of designs and unfavorable site conditions as a result of the Covid-19 pandemic, but the project will eventually be done. In 2018, the government embarked on a Rwf22 billion project meant to develop trade, maritime transport and tourism along the lake. Ports are to be built in four districts – Rubavu, Rusizi, Karongi and Rutsiro.

According to Niwenshuti, the ports being constructed on Lake Kivu will also boost trade in the districts of Rubavu, Karongi, Nyamasheke, Rutsiro, Rusizi, as well as neighboring DR Congo.

“There is a project to construct ports on Lake Kivu that will facilitate trade with DR Congo,” he said.

There will be three major ports with a handling capacity of about 1.5 million passengers per year, and projected to reach 2.8 million by 2036 which are also set to improve cross-border trade through water. A smaller port, the fourth planned port, in Karongi District, will start with a capacity of between 300,000 and 400,000 passengers, by 2036. The ports’ maximum cargo handling capacity is 580,000 tons, while the minimum is 270,000 tons.

Two of the four ports are already being constructed, according to the Rwanda Transport Development Agency (RTDA). As noted, construction of Rubavu port is at 25 per cent while construction of Rusizi port is at nine per cent. The agency has also started the procurement process to get a contractor to build Nkora (Rutsiro) and Karongi ports.

Latest projections indicate that construction activities are set to end in late 2022 for Rubavu district, early 2023 for Rusizi port while Karongi and Rutsiro ports will be completed by early 2024. A high-capacity ship that transports 150 people, six cars and 10 tons of goods will “soon” be introduced on Lake Kivu to boost water transport.

“The works to assemble the ship under government support are at about 50 per cent. It will cost between $2.5 million and $3 million,” Niwenshuti said, adding that it will be completed by the end of the current fiscal year.

Challenges affecting cross-border traders

In spite of the effort to improve infrastructure, traders are put off by different challenges.

“The charge of $30 for a permit known as Permis de Sejour to cross the border for trade in DR Congo is affecting trade. Small women cross-border traders cannot afford it. If the fee is waived, the cross-border trade can be boosted,” said Winifrid Mukeshimana, a trader in Rusizi district who exports vegetables and fruits to DR Congo.

Mukeshimana, who represents a cooperative of 50 women traders, said that they transport and sell vegetables, and fruits to DR Congo three times a week.

“If I sell one bundle of vegetables, I get Rwf1,500 profit. Selling three or five bundles a day for a small cross-border woman trader generates income to satisfy family needs but the charged fee for the trading permit is a hindrance,” she said.

Fabienne Niyitegeka, a cross-border trader in Rubavu district, said that another issue that threatens cross-border trade is the working hours that have been reduced, triggering losses.

“The border is closed at 15:00; at a time when some products have not yet been sold. This results in losses, especially for fruits and vegetables. We are requesting that there be discussions between the Rwandan and the Congolese side, and the hours go back to at least 18:000,” she said.

Low occupancy in cross-border markets

Louis Munyemanzi Ndagijimana, Vice Mayor in charge of economic development in Rusizi district, said that there are still challenges affecting cross-border trade with DR Congo and Burundi despite the available cross-border trade facilities.

“We are hopeful that with relations improving between the countries, traders will be able to make use of the facilities. Previously, the Rusizi-1 cross-border market was highly occupied. But because of charging permits to come to Rwanda, the number of Congolese traders decreased leading to low occupancy in the cross-border market,” he said.

Ndagijimana said the number decreased because small traders are charged $30 to get a permit to come to Rwanda which they can’t afford if they want to buy a few quantities of goods.

“They usually come to buy fruits, vegetables, meat, and different types of flour. We are talking to partners such as Pro-Femmes Twese Hamwe so that we help women in cooperatives to use the market. Meanwhile Bugarama cross-border market is functioning well as it attracts traders from Rwanda, Burundi, and DR Congo,” he said.

More than 13,000 women from Rwanda involved in cross-border trade will be supported through capacity building, financial literacy, and business formalization to understand their rights under a simplified trade regime under the partnership.

According to Theophile Niragire, the vice mayor in charge of economic development in Karongi district, the cross-border market connecting to Lake Kivu is not occupied at full capacity. He said that the cross-border trade between Rusizi district and Idjwi island requires safe boats to transport goods through Lake Kivu.

“It takes about 12 kilometers to reach the island. We need standard boats. There is a market for meat and other goods,” he said.

Betty Mutesi, the Country Director for International Alert Rwanda, said that they are working with small cross-border women traders to address challenges.

“They should play a role in building peace while doing cross-border trade. They need skills to meet quality and standards. Needed on the market. They should respect the rules of the country where they sell,” she said, adding that peace is needed in the region to boost cross-border trade.

“We have projects that provide financial education and financial capability to improve their capital,” she said.

The support is provided through the project dubbed “Mupaka Shamba Letu” which supports women traders in border areas between DR Congo and Rwanda, DR Congo and Burundi and between Rwanda and Burundi.

“The aim of the project is to contribute to an inclusive society, improved cooperation, and lasting peace in the Great Lakes Region of Africa. The project focuses on strengthening the role that women traders residing in the border communities can play through trade.”

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