Transforming Rwanda through trade expansion

KEY RESULTS

• Embedded support | The EIF’s Single Project Implementation Unit (SPIU) has carried out a number of trade-related projects and has influenced broader government policy by establishing similar units across other line ministries.
• Advancing e-commerce | The EIF’s e-commerce project in Rwanda has led to the development of an e-commerce policy and a review of the Competition and Consumer Protection Policy. It has also helped some fintech start-ups grow their businesses through financial support.
• Cross-border trade improvements | EIF projects implemented in Rwanda have improved the formalization of cross-border trade and led to the expansion of markets, improved infrastructure, increased demand, boosted income generation and contributed to community welfare. 
• Regional integration | EIF support for Rwanda’s African Continental Free Trade Area (AfCFTA) strategy brought together public, private, youth, and development partner stakeholders to discuss possible challenges and opportunities related to AfCFTA membership. 
• Boosting local industry | Export-focused support provided to micro-, small- and medium-sized enterprises (MSMEs) under the Made in Rwanda (MIR) programme (including the establishment of a digital portal), led to a three-fold increase in MIR products. 
• Increased market access | There has been increased market access for women-owned businesses locally and to Australia, Germany, the Netherlands, the United Arab Emirates (UAE) and Chinese Taipei. 

Rwanda is a landlocked country of some 13.2 million people (as of 2022) located at a high elevation in the Great Rift Valley of Central Africa. It is the fifth most densely populated country in the world and is surrounded by Burundi, the Democratic Republic of Congo (DRC), Tanzania and Uganda. Situated a few degrees south of the equator, Rwanda enjoys a temperate tropical climate and is home to fertile soils and numerous lakes. 

Rwanda's history has been deeply impacted by the genocide against the Tutsi in 1994, which resulted in the loss of more than a million Tutsi lives. However, in recent decades, the country has made significant socioeconomic development progress. As of 2024, Rwanda’s per capital gross domestic product (GDP) was USD 966.23, and national GDP was USD 13.31 billion. The country aspires to attain World Bank middle-income country status by 2035 through a range of transformational strategies. 

Since 2009, the EIF has supported Rwanda’s development initiatives with a focus on export diversification, increased regional integration of exports, women’s economic empowerment and e-commerce. Support was extended to several projects working to improve the livelihoods and earning potential of informal and formal cross-border traders. These efforts are also helping to transform the business environment for trading agricultural products and to assist with the integration of Rwanda into the global trading system through an increased supply of goods and services to international markets. 

NIU: A model for oversight, ownership, and co-ordination

Largely as a result of innovative activities undertaken by Rwanda’s National Implementation Unit (NIU), the country has become a pioneer in establishing and maintaining effective coordination of development partner-supported projects. The NIU activities have also helped attract focused investments into key drivers of trade growth, such as cross-border trade and e-commerce. 

Rwanda’s NIU, also known as the Single Project Implementation Unit (SPIU), was established in 2011 and is housed in a range of government agencies and ministries to manage donor-funded projects, such as the Ministry of Agriculture and Animal Resources. For example, the NIU housed in the Ministry of Trade and Industry (MINICOM) coordinates donor-funded initiatives related to Aid for Trade (AfT) to help improve efficiency and sustainability. 

The EIF helped build the NIU’s capacity to enable it to carry out trade-promoting initiatives and leverage the country’s resources to boost trade. Rwanda’s NIU was pivotal in undertaking various activities, ranging from negotiating the elimination of non-tariff barriers, facilitating cross-border trade, and advancing e-commerce, to developing value chains and providing needed oversight, ownership and coordination to development partner initiatives. 

The NIU undertook information-sharing initiatives aimed at ensuring that exporters were aware of the results of the EIF-supported Diagnostic Trade Integration Studies (DTIS). These efforts helped to align trade-related activities on the ground with DTIS recommendations. Several companies – including shoe manufacturer Uzuri K&Y and pyrethrum[1] producer Horizon SOPYRWA – have expanded their export operations to lucrative markets due to support from Rwanda’s NIU. 

Improving trade competitiveness through e-commerce

The Government of Rwanda has demonstrated its commitment to developing e-commerce to support export growth. Prior to COVID-19, only a handful of companies had an online presence; by 2024, however, hundreds of firms – including MSMEs – had harnessed the trade potential offered by e-commerce. In 2019, Rwanda’s Ambassador and Permanent Representative to the United Nations and other international organisations in Geneva, H.E. Dr François Xavier Ngarambe, expressed the country’s high ambitions for e-commerce development. "Affordable multimodal platforms will help businesses adopt information technology and export with minimal expenditure and risk,” the Ambassador told the EIF. “Small suppliers and traders – particularly women – will be able to sell online both wholesale and retail.”

As part of the Export Growth Initiative project, EIF support helped to establish and strengthen the capacity of the Made in Rwanda Portal. The portal operates as an online platform to disseminate trade-related information as a means to improve market access for exporters and buyers. Further, the portal allows for efficient interactions between the private and public sectors and provides an interface for identifying needs and improving trade administration. The skills of officials in facilitating learning opportunities to help meet the country’s digital goals were also strengthened as part of the project, with 10 private sector companies receiving training to improve their online marketing platforms. 

With support from the EIF, the Ministry of Trade and Industry ensured that key stakeholders – including the Ministry of Information and Communication Technology & Innovation, the National Bank of Rwanda, the Rwanda Utilities Regulatory Authority and other partners – were able to play a role in e-commerce development. These consultations, together with a diagnostic review of Rwanda’s e-commerce ecosystem, served as a basis for the development of an e-commerce policy and training curriculum. In addition, the project supported a review of Rwanda’s intellectual property laws and its competition and consumer protection policy. 

A range of stakeholders have collaborated with MINICOM to deliver e-commerce training to more than 400 MSMEs. As a result of these efforts, Rwandan MSMEs now have access to international e-payment systems and are tapping into new markets. According to Godfrey Gakire, SPIU Coordinator at MINICOM, MSME training and awareness-raising activities led to a number of businesses being onboarded to e-commerce platforms such as Rwanda Mart (where more than 800 MSMEs have more than 4,500 products on offer), Afri-Farmers Market (where produce from more 7,000 farmers across 15 districts can be accessed), and farm produce site eHaho (which boasts more than 16,000 users). 

These efforts have led to the adoption and implementation of new technologies that will help improve Rwanda’s access to international markets. A MINICOM-hosted government data collection and reporting tool to harvest data from e-commerce platforms is now also in place. In addition, three financial technology (fintech) start-ups were empowered through grants of USD 15,000 each to design new e-commerce solutions and operationalize existing ones to facilitate MSME access to international markets. 

Made in Rwanda: Marketed to the world

Support from the EIF facilitated market linkages to scale-up exports under the Made in Rwanda (MIR) initiative. Training was provided to 719 MSMEs to ensure they met safety requirements in food manufacturing and quality standards in products for export. While MSMEs were initially producing 136 MIR products, the project led to an additional 279 MIR products being produced – a three-fold increase. These locally produced products were marketed to major hotels, leading to a 30% increase in MIR products being used in hotels. The project also supported to establishment of an MIR portal and an updated survey on MIR products and companies. The portal is now operational, with 159 companies registered and 420 products recorded as of August 2023.  

Through the EIF-funded Export Growth Initiative project, the EIF linked nearly 150 women-owned businesses to buyers and markets locally and internationally (e.g., Australia, Germany, the Netherlands, the United Arab Emirates (UAE) and Chinese Taipei), as part of the SheTrades programme. SheTrades, an initiative launched with support from the EIF in partnership with the International Trade Centre (ITC), has helped increase women’s incomes and improve their standard of living. For example, Agnes Mukashinja, Managing Director of Nova Coffee Company, estimated that her company saw a 25% increase in business as a direct result of the project. Mukashinja benefitted from the use of Farmer Connect blockchain tracing technology, a market linkage programme that helped her add value to products and expand exports. She says she has witnessed consistent growth of her business – from four to eight shipping containers of coffee products – and of the coffee producers who are her suppliers.

Strengthening cross-border trade

For decades, cross-border trading between Rwanda and its neighbours remained largely informal, insecure and unregulated. However, a profound shift occurred in 2018 when Rwanda’s NIU – with support from the EIF – established two cross border markets and coordinated a resource mobilization drive to support additional cross border markets. The drive raised some USD 15 million from development partners such as the World Bank, African Development Bank and Trade Mark East Africa (TMEA) to establish eight cross border markets centres across the country at strategic locations Following the development of the Cross-Border Market Operationalization Milestone, cross-border markets that were previously not operational or not fully operational, are now functioning. 

The National Cross-Border Trade Strategy (2013-2018), supported by TMEA, MINICOM and the EIF, played a central role in facilitating the construction of the Karongi cross-border market (on the border with the DRC) and the Burera cross-border market (on the border with Uganda). Together, these markets provide a trading home to 708 members of cooperatives. Improved capacity, enhanced business skills and the removal of trading barriers since the launch of the strategy have led to a significant increase in sales volumes. Recent figures show that 74 members belonging to three cooperatives at Karongi cross-border market are collectively generating approximately USD 240,000 per month. Livestock traders, such as Baziruwiha Bartazar, say the cross-border markets have been of unparalleled benefit to traders. He says that before the Karongi market was built, he could only sell 200 pigs per week; however, by 2022, his sales had grown to 450 pigs per week.

Immigration statistics indicate that weekly livestock buyers from DRC have also increased from 40 buyers before COVID-19 to approximately 150. The tax revenue generated by cross-border markets is being re-invested into local projects, such the construction of community health and education facilities.

Rwanda SPIU-supported policies are also facilitating the efficiency of cross-border trading mechanisms – many of which were previously cumbersome. Examples of supported trade-related national policies and strategies that are still under review include an update of the National Strategy for the Elimination of Non-Tariff Barriers (NTBs), a review of Rwanda’s Trade Policy, National Export Strategy III, and the Trade in Services Strategy.

Cross-border cooperatives were assisted in their procurement of equipment for processing and storage of fresh produce. Meanwhile, buyers of livestock products were linked to markets, thereby increasing the trade of goods to regional and international markets. Rwanda’s Comprehensive Exporters Guidelines now provide access to information for new exporters, which will ultimately increase export volumes.

With an estimated 70-80% of all cross-border traders in Rwanda being women and with more than USD 100 million in cross-border trade flows, the pioneering cross-border trade project has provided a number of lessons on inclusive trade. Support to informal traders, especially for marginalized groups like women, can open up opportunities.  

Looking into the future

Rwanda is continuing its efforts to integrate into regional trade through effective participation in the African Continental Free Trade Area (AfCFTA). EIF support is increasing Rwanda’s understanding of exporter guidelines and reducing export-related challenges faced by those looking to penetrate African markets. Women and youth are of high priority in the project, including through assistance provided to the Private Sector Development & Youth Employment (PSDYE) mechanism (organized by Rwanda MINICOM through its NIU). The PSDYE brings development partners together with public and private sector stakeholders to facilitate high-level discussions on Rwanda’s AfCFTA roll-out, including possible challenges and opportunities, as well as other pertinent trade issues. The EIF Focal Point (the Permanent Secretary of the Ministry of Trade) is the Chair of this forum, while the European Union Office is the Co-Chair, represented by its Head of Cooperation in Rwanda. 

The success of the NIU model in Rwanda has led to strong national ownership and coordination to the point that the Government is replicating the model across other ministries. A strong vision for coordination by the Government provided a key driving force for partners to work together. Investing in coordination for the cross-border trade initiative has enabled collaboration between the EIF and other key funding partners – including TMEA, the World Bank, and others – and has led to remarkable success.