By encouraging Rwandans to produce and consume locally, Rwanda hopes to free itself from the yoke of importation.
According to the website africanews, in 2016, the country’s slate of imports was almost $ 2 billion in 2016, compared with only $ 621 million for exports. A trade deficit that the country intends to fill.
Kigali also wants to help entrepreneurship, especially in the textile and food industry. A logical continuation of the protectionist policy adopted by Rwanda about two years ago, which includes, among other things, the increase in taxes on imported products in order to further motivate local entrepreneurs who are being rid of great competition.
This policy, however, was criticized by the United States for denouncing illegal competition after Rwanda decided to raise taxes on second-hand textile from the United States. The latter had then threatened to remove Rwanda from the trade partnership agreement, AGOA , which favored these imports.
And the challenges are still big, like the Rwandan ambitions, at least for a start. Rwanda is still very dependent on imports, the rest for basic necessities. Reducing domestic demand to local production therefore implies high production to avoid the risks of inflation.
Another parameter relating to this is, of course, the supply of the raw materials necessary for the manufacture of these products which could also come up against the protectionist policies of the countries solicited. There is also the question of energy, the costs of which are still very high compared to neighboring countries. A concern that also inhabits Rwandans is the monopoly of companies that will impinge on the quality of products.
But for the time being, Rwanda believes in its good fortune and hopes to become China’s Africa soon.