The Minister of Trade and Industry, Jean-Chrysostome Ngabitsinze has urged local agro-process manufactures to tap into opportunities offered under the African Continental Free Trade Area (AfCFTA)
By Olivia Kageruka
He said on Wednesday, August 10, during the opening of East African Business Council (EABC) consultative meeting between East African Community (EABC), Southern African Development Cooperation (SADC) and the Common Market for Eastern and Southern Africa (COMESA).
Business councils converged to come up with a joint position paper on how the private sector from the three blocs can be considered in the AfCFTA implementation process.
This comes after Rwanda was picked among countries set to start trading under the AfCFTA framework in a pilot phase that also involves six other countries.
Ngabitsinze said that the first thing to consider is to identify where there is much potential in terms of continental trading.
“Over 4,000 local cooperatives are in agricultural business, small firm industries are agro-processing based, it shows how agriculture plays a major impact in trade and if we upsurge on the agro- processing industries, the county will be able to tap all the prospects in free trade area, but only if we have competitive products on the market”, he said
He added that despite other sectors’ role, agriculture plays a significant part in the country’s economy, based on the recognition of the major players and its impact, calling for the need to prioritize it.
Lack of stable political strategies to favour the continental trade from one country to another, high interest rate from the bank loan, high means of transport during importing and exporting product.
Meanwhile, the participants at the meeting called for collaboration amongst themselves saying that poor communication between traders was a major stumbling block.
“Another concern is transport which is too high for exportation compared with importing. The EAC should work with our government to decrease the tax and revenue, to allow domestic manufacturers to also export products easily,” said Jacky Uwase, who represented Esperanza Group Ltd, a Rwandan beverages firm.
She added that her firm has been exporting their products to different countries including Congo, Uganda and Tanzania, adding that they are ready to expand their horizons and spread to other countries under the continental trade platform.
“With the expansion of the free trade area, we are optimistic to expand our operations, which means more employment opportunities and industralisation growth in Rwanda,” she said.
According to the CEO of East African Business Council (EABC) John Bosco Kalisa, the AfCFTA offers a huge opportunity to all traders, the private sector and governments should work together to address any bottlenecks.
“We are embracing e-commerce and asking traders to work together and cut the high tariff on import and export. Banks should also reduce interest rate to lessen the cost of borrowing,” he said.
According to Kalisa, banks should consider reducing the cost of borrowing to at least 8 per cent instead of 17 or 20 per cent, which he said will bring more players on board and significantly boost intra-Africa trade.
The landmark AfCFTA agreement, signed in Kigali in March 2018, envisions a continental market of 1.2 billion people, with a combined Gross Domestic Product of more than $3.4 trillion.