Rwanda: Cimerwa calls for protection from illegal exports

Rwanda: Cimerwa calls for protection from illegal exports
Published: 22 June 2016

Tagged Under: Rwanda Exports 

Cimerwa, Rwanda's sole cement producer, has asked the government for protection, saying local dealers are exporting its cement illegally, affecting its key markets in the Democratic Republic of Congo and Burundi.

All Africa reported that Busisiwe Legodi, the Cimerwa CEO, said the problem is made worse by the fact that some of the local dealers buy cement at subsidised prices for the Rwandan market, but sell it on in small quantities to the DR Congo and Burundi, making it hard for the cement manufacturer to sell.

"Local bulk buyers get the cement at subsidised prices and sneak it out of the country to our target markets," she said, adding that illegal cross-border trade remains a challenge, not only for Cimerwa, but all exporters in general.

The Rwandan government and the private sector have intensified campaigns at encouraging Rwandans to consume locally-made cement, as well as broadening the country's exports base. Domestic cement demand currently stands at about 450,000tpa, driven by the increasing demand for cement by the local construction and real estate sectors. The surplus output is targeted for the export market in the region, especially Burundi and the DR Congo.

The firm has also cut factory prices to attract clientele in the highly competitive regional cement market. Cimerwa reduced the factory price for bulk buyers (more than 700 bags of cement or about 30,000t) by RWF1200 (US$1.59) per 50kg bag of cement to RWF7300 from RWF8500. However, Busisiwe said retailers benefitting from low prices export to regional markets, which has eaten into the firm's export markets.

"We we have raised the matter with the Rwanda Revenue Authority (RRA) customs department, but they yet to respond to our grievances," she said.

Rwanda's cement imports fell to US$82.7m in 2015 from US$85.6m in 2014, according to the central bank statistics.