PUBLISHED ON December 15th, 2014

Rwanda seeks regional trade logistics hub status

KIGALI, Rwanda – Rwanda believes it can turn into a trade logistics hub in the East African Community and this is why the government through the Ministry of Trade and Industry is streamlining services that will help realize this objective.

“The cost of trading across the borders which is mainly because Rwanda is a landlocked country, still affects the cost of shipping goods from Kigali to the ports of Mombasa and Dar es Salaam. Vice versa but we have an ambition of making Rwanda a regional trade logistics hub,” Rwanda’s Minister of Trade and Industry, Francois Kanimba said during the Services Investment Forum held in Kigali recently.

Kanimba said this may appear ambitious, but the government strongly believes it is possible.

“This will be achieved only through a multi-facilitated partnership, first of all with our neighboring countries in the region,” Kanimba said.

The current initiative under the Northern Corridor Integration Project, of which Rwanda is a member, is also aimed at cutting down the costs involved in trading in the landlocked countries.

Rwanda has so far achieved positive results with the establishment of the Single Customs Territory in the three countries (Kenya, Uganda and Rwanda).

“The removal of the non-tariff barriers such as the weighbridges, and roadblocks and the establishment of One Stop Border posts has dramatically reduced the costs and time spent to get goods from port of Mombasa to Kigali,” Kanimba said.

He said Rwanda hopes to enjoy same benefits through the Central Corridor when Tanzania joins the Single Customs Territory.

The road haulage industry of Rwanda represents around $5million per annum. This convinced the government to develop the trade logistics service strategy which has reduced the cost of transport services of goods to Rwanda and from Rwanda to the global markets tremendously.

“The market share of our transporters to tap into this opportunity has reduced now standing at 14% from the 21% it was on in 2007. This is because the country has been conducting a deep analysis to understand what are the factors that limit the competitiveness of its tracking industry engaging the business community, and a number of issues have been identified and decision have been taken by the government, but also engaging our partners in the EAC to remove some of the discriminatory practice which may have created unfair competition in the region,” Kanimba said.

He said, “Government looks at establishing a dry port at Kigali (the Kigali logistics platform) which will facilitate quick turnaround of logistics and again reduce on costs.”

“If such logistics are up and running efficiently they will transform themselves into potential exporters of logistic services since neighboring countries will use them,” Kanimba said.

Source: The East African Business Week

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