Rwanda’s Growing Appetite for Imports Widen Trade Deficit

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Boosting local production while encouraging consumption of locally manufactured goods will boost exports and play a key role in trade balance.

Rwanda’s trade deficit continues to widen owing to a large import bill dampening the prospect of East Africa’s largest economy sustaining its current growth streak. This comes even as economists warn that the country’s reliance on exports is exposing the economy to shocks and should be addressed.

According monthly statistics of external trade in goods released this week by National Institute of Statistics institute Rwanda’s total trade amounted to US$ 102.22 million in March 2017, an increase of 34.61 per cent compared to the previous month of February.

Year-over-year, the formal trade in goods deficit decreased by 10.51 per cent on the deficit of March 2016. Experts believe boosting local production while encouraging consumption of locally manufactured goods will boost exports and play a key role in trade balance, thus stabilizing the economy going forward.

Figures show that domestic exports values also increased by 39.56 per cent compared to February 2017 and increased by 23.40 per cent compared to March 2016. Table 2 shows exported goods in value of exports in March 2017 by SITC sections.

Import Growth

In March 2017, total imports values increased by 29.68 per cent compared to February 2017 and also decreased by 1.08 per cent compared to March 2016.

According to the report re-exports values decreased by 5.73 per cent compared to February 2017 and also increased by 13.57 per cent compared to March 2016.

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