Zimbabwe’s trade development and promotion agency, ZimTrade, says local manufacturing companies should consolidate their orders to Rwanda to enjoy maximum benefits of a plethora of opportunities in the Eastern African nation and cut high transport costs in the process.
Presenting survey results on Rwanda market, ZimTrade export promotion manager, Vuyiswa Mafu, said Rwanda, last year imported goods worth more than US$1bn against exports of about US$318m, leaving a trade deficit of about US$700m.
Imported goods include fast moving consumer, building and construction materials, horticulture products and services.
ZimTrade said local companies can exploit these trade opportunities.
It is understood that for a Zimbabwean company to export to Rwanda, an exporter has to pass through Zambia and Tanzania.
ZimTrade said these were costs that companies can minimise if they can export in numbers.
“Local companies can consolidate orders to reduce individual cost of transport. The 45% price differential is good for Zimbabwean products and a consideration is to be made for the local products to be exported to Rwanda as prices after transporting may match local prices in retail,” Mafu said.
ZimTrade said Rwanda offers access into other markets, such as the East African Community which offers a market potential of 177m consumers and close access to the DRC market.
The market has a strong link to USA and Tanzania through the main retailer Simba Supermarkets, Sina Gerard and other smaller supermarkets such as, Rafta Mart, Umiringa, Carrefour, Best Friend and Raah.
Rwanda has a pool of small supermarkets located around the country.
Sina Gerard and Simba Supermarkets are the bigger retailers and have outlets across the country.
Smaller, informal traders are assisted by the government with tax exemptions for the first two years of operations.
ZimTrade said distributors in Rwanda were interested in sourcing products from Zimbabwe.
Most Rwandan distributors in the FMCG industry are interested in mayonnaise, tomato ketchup, rice and sugar.
Agriculture in Rwanda is a major economic sector that employs about 70% of the total population with 75% of the agricultural produce being generated by smallholder farmers.
The main products are tea, coffee, pyrethrum, flowers, cassava bananas, sugarcane and bananas among others.
Mafu said farmers in Rwanda need skills development and training on farming techniques hence consultants and technical experts from Zimbabwe can provide technical experiences on horticulture through exchange visits between the two countries.
Products from the smallholder farmers are consolidated for trade and the government is providing incentives and support to promote production in this sector.
This includes infrastructure support for product processing, technical support as well as extension services, awareness training, storage facilities and innovation facilities.The production volumes are still low and there is an opportunity for farmers from Zimbabwe to invest in Rwanda as the country has made land available, ZimTrade said.
There is also a surge in the building and construction industry as the country is under development.
This includes office buildings, recreational facilities, hotels, houses and stadiums.
There are multiple projects happening concurrently therefore leaving a gap in skills and increased requirements for materials.
Sourcing locally (Africa) is ideal as the turnaround time is shorter.
Mafu said Zimbabwean consultancy firms have the opportunity to bid for tenders using the online platform as approximately 80% of the inputs used by building and construction companies are imported.
Local companies, Mafu said, should also consider joint ventures as Rwandan companies are open to creating partnerships with foreign companies, especially for the supply of inputs for construction works and monetary investment to support project implementation.