Over 6000 products from ranging from horticultural, minerals, agro- processed and other food exports will be able to access the US markets days after the government and United States inked a free trade deal.
Early this month, trade and industry minister Francois Kanimba and the US Ambassador to Rwanda Erica J. Barks-Ruggles signed a Tax-Free exports deal under the African Growth and Opportunity Act.
Accordingly, Rwanda’s trade with US market continued to surge for the last decade with total trade between the two countries growing to 60 million in 2015 with export accounting U$ 46 million while imports fetched U$ 14 million in 2015.
“Rwanda’s exports have been growing steadily over the past ten years, with an annual average growth rate of 21percent,”said Emmanuel Hategeka, permanent Secretary in the Ministry of trade and Industry.
Export matters because it provides the foreign capital we need to invest in our economy and grow our GDP,” the Permanent Secretary added.
Statistics form ministry of Trade show that largest export to the US market was coffee with over 23 million in exports, minerals $ 17.8 million, pyrethrum 2.1 million and a range of smaller value exports.
Hategeka says that the US has also accepted specialty foods from Rwanda, another, opportunity for the country’s budding manufacturing and processing sector, “All these initiatives aim to help Rwandan firms to overcome the challenges they are facing.”
He adds, “To grow exports from our food sector we need to explore all opportunities.”
Under the arrangement, Rwandan producers have a significant competitive advantage from the 0 percent duty preference under AGOA.
The arrangement also includes 27 travel and luggage goods from developing countries on the list of products that receive duty-free treatment in US under Generalized System of Preferences (GSP) Annual Product Review.
“We are ready as private sector to utilize this opportunity and make sure that our local products access external markets,”said Stephen Ruzibiza,chief Executive Officer, private sector federation.
The country is under the National Export strategy looking at increasing its export receipts to fix its widening trade deficit that recently increased by 5.1percent in the first half of 2016.
Also, Rwanda and Kenya on Thursday signed the East Africa community-European Union Economic Partnership Agreement- “EAC-EU EPA”securing the duty free quota free market access to the EU on a non-unilateral offer but contractual basis.
The negotiation for this trade partnership has been dragging since 2007.
Under the agreement, the European Union is expected to liberalise 100 percent while Rwanda and Kenya will liberalize 82.6 percent on a progressive basis over a period of 25 years after signature, while 17.4 percent of tariff lines including agriculture processed and non-products has not been liberalized.