By MOSES K. GAHIGI

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Local clothes and shoemakers under the “made in Rwanda” initiative are still grappling with low sales as buyers prefer imported products due to their quality and low cost.

According to consumers this paper spoke to at the just concluded Made in Rwanda Expo, many would buy locally-made products but most items were not stylish or their quality was low.

From locally-assembled motorcycles, furniture to canned mushrooms, a wide array of locally-made products were on display at the expo. However, perceptions of the high cost of the products remain a challenge as price remains a key consideration for most consumers.

Rwanda Private Sector Federation chief executive officer Yvette Mukarwema, said the prices are fair given the quality of the products made in the country especially leather products.

She said that comparing the semi-leather products, which are imported, with the genuine leather products made in Rwanda is unfair.

Although some of the shoes made in the country are manufactured from authentic leather, the finishing and alignment remains poor.

Waived taxes

Last year, the government waived taxes on imported raw materials and accessories for the apparel and footwear industries, but this has not yet translated into meaningful price reductions.

Market analysts say the small scale at which many local manufacturers produce undermines the potential benefits of the tax rebates.

The president of Drecoki, a garment makers co-operative, Benjamin Banziririki said the tax waiver has not helped reduce prices because it only applies to large-scale industrial producers.
“The waiver has only benefitted industrial producers who can go out and import raw materials and accessories for themselves. We still buy from local traders who are not eligible for the tax waiver,” said Mr Banziririki.

He added that for the prices to reduce, the government needs to extend the tax exemption to smaller producers and also facilitate access to cheaper credit to enable local manufacturers to grow.

READ: Rwanda seeks to raise export revenue, local production

Phasing out second-hand products

As part of efforts to support local manufacturing, the government started phasing out imported second-hand clothing and footwear by raising import duty on second hand clothes from $0.20 to $2.50 per kilogramme, while import tariffs on footwear increased from $0.50 to $5 per kg starting in 2016.

However, low supply from local manufacturers and the affordable cost of second-hand clothing and footwear makes them popular with consumers.

Overall, producers were happy with the Made in Rwanda Expo as it gave them a platform to promote their products and engage with consumers.

“It was a great opportunity for us and we saw a lot of interest about our products,” said Ritah Rwangezi, the marketing manager of Kigali Farms.

She said that in a month they sell one tonne of fresh mushrooms in Kigali and export two tonnes to Uganda and Kenya. Ms Rwangezi said they expect to increase their local sales due to gaining more visibility at the expo.  

READ: Outcry in Rwanda as govt increases tax on second hand clothes, shoes

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