Local manufacturers outline factors that hinder production and affect market prices


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Local manufacturers outline factors that hinder production and affect market prices

Yanditswe Feb, 06 2020 16:36 PM

Factory owners here in Rwanda say they have continued to face a number of challenges in their efforts to develop and say they could cause the prices of locally manufactured goods to keep going up.

Even though Factories have been developing and increasing in Rwanda; now 349 compared to just 49 before the 1994 Tutsi Genocide, things like taxes have continued to be a concern for the Private Sector.

Theoneste Ntagengerwa,  PSF Spokesperson said; "What we want is for all those taxes to be consolidated, but take into account what activities are actually being carried out. The fact is, people in all countries pay taxes and they do so in a way that is conducive to business. All we ask is that it be considered if some taxes are hindering trade. Every little increment in such taxes, however small, must have an impact on the finished product's price. The most important thing is also to look at the benefits of paying that particular tax because we all know there are benefits," 

Industrialists who import raw materials to manufacture their local products do not have to pay import tax for those materials, but they say the packaging is still a serious problem.

Saidi Hitimana, a local factory proprietor said; "We need packaging facilities, because it is very hard for us, be it for goods to be sold here in the country, or exported. Bad packaging leads to a loss of confidence in the product itself. There is also the issue of mindsets. When people see clothes that are not wrapped, they thing they are second hand. We have that problem,”

Rising energy costs have also been another issue of contention, especially in the Rwanda Manufactures Association.

Claudine Mukeshimana,  Rwanda Manufacturers Association Executive Secretary said; "We noticed that they hiked up prices for manufacturers and we are part of the Made in Rwanda Initiative. Any small rise has an impact on our operations. That means our commodity prices will also have to go up which will be a problem. If energy costs are going up, they should reduce something else so that we can meet in the middle," 

Officials in the Ministry of Trade and Industry say everything possible is being done to promote Industries in the country.

Samuel Kamugisha, Director General at the Ministry of Trade and Industry said; "There is the elimination of VAT, be it on the the equipment they use or other raw materials they may need. That applies to those in packaging, but we are still looking into how to perfect it. We are also encouraging more investment in that particular sector; in packaging; because those involved as of now are no more than 10 entrepreneurs,"

The Government seeks to create 200,000 new jobs every year outside the agricultural sector and that is why the Industrial Sector must be development rapidly.

Serge Ntore reports 

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