Rwanda’s export to the EAC on the rise

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Rwanda’s informal cross border exports up despite Burundi’s trade ban.

Rwanda’s informal cross border exports up despite Burundi’s trade ban.

New economic data from Rwanda’s formal cross border exports to East Africa increased by 25.7 percent to U$ 83.48 million from U$ 66.4 million in the first half of 2015. The cross border formal exports represented 33.3 percent of total exports.

Whilst, Imports dropped by 7.4 percent in the first half of 2016 up from U$ 201.2 million in 2015, thus pushing the formal cross border trade deficit to contract by 24.4 percent  to USD 143.3 million in the first half of 2016 from USD 189.6 million in 2015.

However, Rwanda’s informal cross border exports continue to surge by 28.3 percent in the first half of 2016, despite trade hiccups since the beginning of 2016 before climaxing in July with Burundi closing its trade borders.

Information from the Central bank of Rwanda indicate in its half year results indicates that the country’s informal cross border export receipts which accounts for 24.6 of  its total  exports amounted to U$ 66.2 million in the first half of 2016 from U$ 51.6 million in the same period of 2015.

Informal trade captures trade between borders that is normally done by communities around borders and may not be recorded the country main trade statistics but is the trade driver along the borders. 75 percent of this trade is done by women.

Accordingly, Democratic Republic of Congo accounts for 65.8 percent of Rwanda’s total informal cross border exports, while Uganda accounted for 26.9 percent while Tanzania accounted for 7.3 percent and Burundi only shared 0.03 percent.

The positive outlook in total informal export receipts John Rwangombwa, Governor of Central Bank says “is due to the high exportation of livestock as well as mobile phones to Uganda,” with Uganda taking over from Burundi.

Experts say that the ban of trade by Burundi has so far boosted trade both in imports and exports between Rwanda and Uganda.

“When you go to see, what Burundi was exporting to Rwanda is replaced by Ugandan products,” Davis Mukiza, a business analyst told this website.

The country’s informal cross border trade continued to register a surplus of 25.4 percent increase in the first half of 2016 as result of good performance in its informal exports despite an increase of imports by 39.5 percent to U$ 14.8 million in the first half of 2016 from U$ 10.6 million in 2015.

“Our main trading partners in informal imports cross border were Uganda, Burundi and Democratic Republic of Congo (DRC) which represent a share of 58.6 percent, 32.1percent and 6.9 percent respectively,” said Thomas Kigabo, Economist with Central Bank.

The Survey conducted by KT Press at the border of Gatuna –Rwanda’s main border with Uganda indicate that exports of fish, fruits, and eggs and other products from Uganda had increased since June this year.

Whilst a surge was recorded at Rwanda’s Rubavu border with DRC after the latter opened its market for more Rwanda products this month.

“We are taking this advantage of Congo to increase the cross border market our agro processed products and we believe this will increase export receipts,” said Christine Murebwayire, chairperson of the Agriculture chamber of Private sector Federation.

Statistics from the bank indicate that the main commodities traded were livestock, agriculture products, telecommunication equipment for exports and maize flour, agriculture products, fresh fish, modern beer, cement and other manufactured and recycled products.

 

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