Kenya now moves to set up product warehouses in Rwanda, Burundi and Congo as it tries to seal a $11.4 billion trade deficit

Nairobi City
  • Logistical challenges continue to remain a bottleneck.
  • Each household in Rwanda spends an average of 24,000 shillings ($240) monthly mostly on clothing and shoes.
  • The Kenya Export Promotion and Branding Agency is also carrying out research in Mozambique and Tanzania to establish potential markets.

Kenya is in the process of setting up warehouses in Kigali, Bujumbura and Lumbubashi and ease access of Kenyan products in the three countries.

The country has a Ksh 1.14 trillion ($11.4 billion) trade deficit that it now wants to reduce through increased exports to among others the east and central African market.

Logistical challenges has, however, continue to remain a bottleneck.

Kenya Export Promotion and Branding Agency (Keproba) CEO Peter Biwott says logistic challenges have seen the volume of Kenyan exports to the East and Central African market reduce, necessitating the new initiative.

Different consumers different needs

Kenya, mainly exports iron sheets, steel, oils, perfumes, paints, paper and cigarettes to Rwanda and Burundi.

In recent years though, the demand for Kenyan products has slumped in the two landlocked states amid competition from China, India and Saudi Arabia, a study by Keproba shows.

“There is a notable trend in the abandonment of the Kenyan brands in Rwanda and Burundi due to increasing prices, unavailability of products, competition from substitute products and counterfeiting,” says the study released on Tuesday.

Kenya commands 3% share of the import market in the two countries, valued at about Sh6.5 billion ($65 million) in Burundi and Sh17.8 billion ($178 million) for Rwanda.

According to research by the Kenya Export Promotion and Branding Agency, Rwanda is a lucrative consumer market with each household spending an average of 24,000 shillings ($240) monthly mostly on clothing and shoes.

On the other hand, Burundian consumers are more interested in price other than quality with Kenyan edible oils popular in that market.

As a result, county governments have been advised to harmonize their levies to lower the cost of production of local goods destined for east and central Africa.

Next frontier

The Kenya Export Promotion and Branding Agency is also carrying out research in Mozambique and Tanzania to establish potential markets for Kenyan goods.

Meanwhile, Uganda has been the region’s most consistent trade partner, surpassing Tanzania in 2017, according to a Uneca report dubbed An Analysis of the East African Community’s Trade Performance.

Uganda’s share of intra-EAC trade jumped to $800 million in 2017, from $780 million the previous year.

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