Rwanda's trade deficit reduced by 21.7 per cent in 2017 due to improved international prices that boosted revenues collected from the country’s exports.
This represents a fall in Rwanda’s negative balance from $1.6 billion in 2016 to $1.27 billion in 2017.
This is according to the Monetary and Police Policy and Financial Stability report launched by the National Bank of Rwanda last week.
In total, export revenue increased by 57.6 per cent to $943 million while volumes increased by 36 per cent.
After three consecutive years of low international prices for minerals, Rwanda’s tin, coltan and wolfram exports regained footing to fetch the highest revenues for Rwanda, contributing a combined $125 million in 2017. This is an increase of 44.6 from the previous year.
The mining sector is, however, still dogged by the exportation of raw minerals which fetch low prices than processed minerals on the international market, Central bank Governor, John Rwangombwa said.
“The artisanal miners are disorganised and have little capacity to come up with bankable projects. The banks don’t really understand the sector very well and are reluctant to lend,” Mr Rwangombwa said.
“There are, however, changes in the sector spearheaded by the government, aimed at modernising the sector and this will help the artisanal miners going forward.”
Minerals were followed by coffee, whose export value increased by 9.6 per cent to $64 million; and tea which fetched $63 million, an increase of 33 per cent.
On the other hand, imports to Rwanda slightly declined by 0.4 per cent to $2.21 billion in 2017 from $2.22 billion the previous year.
“The decrease in the value of formal imports was largely driven by a decline of 12.4 per cent of capital goods, including machines, tools and devices,” Mr Rwangombwa said.
“This is related to the phasing out of some major construction projects, especially big hotels that imported machines to undertake construction in June 2016.”
Importation of clothes also drastically fell by 17 per cent in 2017 after government slapped a levy of 2.5 per cent per kilogramme of imported used clothes from 0.2 per cent, which was aimed at promoting Rwanda’s garment factories.