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Rwanda: Govt, Investors Sign Deals to Boost ExportsFriday, December 05, 2014 > 12:04:16
New agreements signed with several investors in the service industry could see the country earn more export revenue from the sector.
The agreements, signed yesterday between Pan African Logistics Limited (PAL), Africa Smart Investments, and Kwetu Film Institutions, are geared toward scaling up service exports, the Minister for Trade and Industry, Francois Kanimba, said.
The initiative is also expected to help reduce trade deficit, create employment opportunities and ultimately enhance the country's economic growth.
The signing took place at the closure of the two-day Service Investment Forum in Kigali.
Under the memorandum of understanding, PAL will commit a $10 million investment capital and 150 trucks to boost the country's transport between Kigali and sea ports.
In the same respect, Africa Smart Investments will also commit about $15 million (Rwf10.3 billion) toward promoting and exporting products made in Rwanda across the globe.
Under the agreement, government will offer the necessary support, including logistics, infrastructure and facilitation to the investors.
"It's a testimony of good cooperation and a strategy to increase service exports. We want to make sure that every time we set a target it is a shared responsibility," Kanimba told investors.
He also noted that government has already signed similar deals with investors in the mining and manufacturing sectors.
We are yet to sign more agreements with those investing in horticulture and other sectors of the economy, he added.
Jain Sugu, Director Pan African Logistics Limited, said the initiative will help further reduce Rwanda's cost of doing business and enhance its competitiveness in the regional markets.
"With this agreement, government is committing to facilitating our cargo trucks do transact business between Kigali and sea ports at no cost. This will help reduce the unnecessary delays truckers have been experiencing and enhance our competitiveness in the region," Sugu said.
It's a signature of mutual commitment that will help our growth while penetrating other regional markets, she added.
With its headquarters in Nairobi, Kenya, Panafrica Logistics Limited was incorporated in 2003 as an overland long haulage transportation of containerised transit cargo from the port city of Mombasa in Kenya to various destinations in East Africa.
Francois Karenzi, Board Chairman Africa Smart Investments, said the agreement will strengthen the company's ability to export products made in Rwanda across the globe.
"We have committed ourselves as a consortium of 15 companies to export products made in Rwanda. The agreement, therefore, is a big booster to us as a group of companies in terms of knowledge and capacity."
Eric Kabera, the managing director, KWETU Film Institute, said he will take advantage of the agreement to market the country's film industry internationally.
Government is targeting to increase its exports to a tune of 28 per cent per year by 2018, according to the second Economic Development and Poverty Reduction Strategy.
Exports from the service sector alone are projected to increase from current$400 million to $2.5 billion by the same period.
This will help narrow the country's trade deficit currently widened by 14.9 per cent during the first eight months of 2014.
The service industry currently contributes 48 per cent to Rwanda's GDP, 75 per cent and 47 per cent to global and African economies respectively.
The two-day forum attracted more than 600 investors, policy makers and business leaders from Angola, Djibouti, Zanzibar, Mauritius, Kenya, Uganda, South Africa, Nigeria, Spain, and the US.