Knowledge of potential export markets for South African stainless steel is key for business growth in 2021. This month one of our country profiles is Rwanda, the second fastest growing economy in Africa which has averaged robust annual GDP growth of 7.5% for the past decade.
The population of Rwanda is approximately 12.6-million and education is a key focus of the country, and particularly tertiary education, with a literacy level of 75% and an unemployment figure of 15%. In terms of language use, most of the population speak English and French and in terms of age profile, 70% of the population is under the age of 30. The split in terms of the economic business sector is: Services (49%), Agriculture and Agro-Processing (24%), Industrial (18%), and Other (7%)
Export opportunities
Currently, the largest exporters into the country are Uganda, Kenya and Tanzania, with China and India also present but not dominant. South African exports to Rwanda have grown steadily over the past decade from R181-million in 2010 to R450-million in 2019.
The major export sectors are:
• Chemicals;
• Vehicles, aircraft and vessels (including parts thereof);
Note VW has a manufacturing operation in Rwanda and many of the parts come from SA.
• Machinery
Most exports currently enter the country via the ports of Dar es Salaam (Tanzania) and Mombasa (Kenya) ports, and proposed upgrades to the harbour in Mpulungu (Zambia) should be finished by next year, greatly improving logistics within the country.
Projects with potential
There are currently 85 active projects happening in Rwanda with a total value of US$20-billion, amongst the following sectors:
• 9% Water, sanitation and dams
• 25% Transport, logistics and infrastructure, ports
• 15% Power
• 29% Agriculture and
Agro-processing.
The government has also committed US$440-million over the next three years for further developments in water, sanitation and dams.
There is also a strong commitment from the government to encourage the participation of foreign-owned companies and investors in the country, with a capital gains exemption on the sale or transfer of shares. A foreign country can register as either a Rwandan company, subsidiary of an overseas company, a joint venture or online and receive their certificate via email. There is also no need for a resident foreign owner or partner and no restriction on repatriation of funds.
In addition, a Visa is not required by any African citizen and an automatic 30-day visa is issued on arrival in the country, free of charge. Land ownership by foreigners is also allowed, with a 49-year maximum leasehold, depending on the use of the land.
Regional outlook
With the regional economic context, Rwanda is a signatory to Africa Growth and Opportunity Act, and part of the Common Market for Eastern and Southern Africa and the East African Community. It has also signed and ratified the Africa Continental Free Trade Area (AfCFTA). Its full support of the AfCFTA is no surprise given its strategic location, with easy access to DRC, Uganda, Tanzania and Burundi. It also has various Special Economic Zones (SEZ’s) close to its borders with these countries with the largest, the Kigali SEZ located just outside Kigali and close to the international airport.
Interestingly, unlike many countries on the African continent, Rwanda has a surplus of power and is encouraging industries that use power in high quantities to set up industries in the country to absorb its excess power supply.
If you are interested in investigating business and export opportunities to Rwanda further, Sassda has a close working relationship with the Rwandan Development Board and we would be happy to help our members set up suitable meetings. In addition, South Africa’s Ambassador to Rwanda, HE Mandisi Mphatla, has worked with Sassda for some years, including during his previous stint as Mozambican Ambassador.
For more information and or for any assistance you might require please email Sassda Market Intelligence Specialist, Lesley Squires
lesley@sassda.co.za