Uganda’s export earnings from Rwanda fall to an all time low 

Thursday November 05 2020

The Gatuna border, which is an easier access route for Ugandan exporters has been partially or fully closed for at least 21 months. PHOTO | FILE

By Dorothy Nakaweesi

Uganda’s export receipts from Rwanda have fallen to an all-time low, demonstrating the impact that the closure of the country’s border has had on trade between the two countries. 
Some of Rwanda’s border points have been closed to Uganda for almost 21 months now with negotiations to reopen them ongoing. 
In the period between August 2019 and August 2020, cumulative export earnings from Rwanda, according to Bank of Uganda, fell to just $5.1m (Shs19.2b) from $131.8m (Shs494b) in the same period between August 2018 and August 2019.
The fall represents a Shs493b decline, which Ugandan exporters have lost within one. 
Export earnings to Rwanda have been falling since February 2019 but the worst decline was recorded in April and August in which Uganda earned a paltry $40,000 and $60,000, respectively.
Before the closure, Uganda had been fetching an average of at least $18m earnings per month. 
The sharp decline in April was largely due to the global lockdown, which had forced closure of borders across the world. 
It is difficult to know when Rwanda will open its borders to Uganda, with negotiations to solve the tension bringing out more demands.  
On February 28, 2019, Rwanda closed off its Katuna border, which was preceded by a trade standoff between Ugandan exporters and the Kigali government. 
The standoff between the two East African countries has hit manufacturers of Cement, Steel and Roofing materials the hardest. 
Others manufactures such as personal care products, petroleum products, beverages, and other fast consumer goods have also not survived. 
Although other border points such as Mirama Hills, Cyanika and Kamwezi have been open, there is limited entry of goods and exporters have said the distance and cost of transport to access the above mentioned borders is economically not viable. 
Roofings, which manufactures iron and steel products and one of the largest exporters to Rwanda recently told Daily Monitor they had suspended exports to Rwanda worth between $7m and $8m. 
The company had been exporting at least between 600 and 1,000 tonnes of iron sheets. 
Yesterday, Mr Stuart Mwesigwa, the Roofings business development manager, said they had not resumed exports to the country. 
Mr Mwesigwa, who is also a representative of Uganda at the East African Business Council, although they had tried to intervene under the EABC, they had, as Roofings explored other markets such as DR Congo, South Sudan and Tanzania.
Hima Cement and Movit Products, which manufacture personal care products, have also registered massive losses in export income.
Ms Caroline Kezaabu, the Hima Cement public relations officer, yesterday said the company was yet to lift the suspension that was instituted at the close of last year.  
Rwanda had, before the suspension, been Hima Cement’s export destination taking at least about 30 per cent of the company’s cement exports. 
However, the company has since ventured into DR Congo and South Sudan although Hima recently acknowledged they are not comparable to Rwanda in terms of consumption. 
In June 2018, for example, Hima Cement commissioned its $40m a plant in Tororo that had sought to add 0.8 million tonnes of cement per annum specifically for export.