Revenue from beer exports is expected to drop significantly after Democratic Republic of Congo introduced new taxes to protect its industry.

Total revenues from export of beer from Rwanda to DRC were between Rwf27 and 40.8 billion in the past two years.  

Although Rwanda’s leading brewer Bralirwa, exports huge volumes to DRC and Burundi, exports to other East African Community countries are still low.

DRC is restricting Rwandan beers to protect its local industry after establishing a brewery factory in Goma, the capital of eastern province of Kivu.

However, trade experts believe that with growing and diversification of Rwanda’s trade basket, the protectionism from DRC won’t affect the country’s export sector.

“DRC has introduced restrictive taxes and charges against Rwandan beer exports in order to protect its products and this was done without any prior warning,” said a trade expert with Trademark East Africa.

However, experts also believe that restrictions by DRC will improve innovation for Rwandan brewers to penetrate new markets.

“Rwanda’s exports are growing and the restrictions by DRC will improve innovation and efficiency in the country’s brewery industry, which would make it easy to penetrate into new markets,” the expert added.

Currently, Rwandan beer makers are exporting insignificant amount of their products to EAC markets while both East African Breweries Ltd and Nile Breweries Ltd have flooded Rwandan market with their products.

Bralirwa products go for an average of Rwf800, skol costs Rwf1000 while tusker larger and bell larger cost Rwf1000 in most bars in Kigali.

According to the monetary policy and financial stability statement released in February, Rwanda’s export sector in 2013 recorded Rwf363 billion in formal exports, representing an annual increase of 18.7 per cent.

Skol downplayed losses it is likely to suffer as a result of DRC’s protectionism, saying it does not directly export its products to Congo.

“For skol, we have not suffered any problem since we don’t directly export there but we have partners in that country manufacturing the same product,” said Mark Mugarura, skol’s marketing manager.

DRC has two plants producing skol located in Kinshasa and Lubumbashi.

By the end of 2012, skol was producing 100,000 hectolitres annually but with a five year expansion plan which has seen Rwf1.3 billion earmarked, the brewer expects increased production.

However, Bralirwa, which exports directly to eastern DRC and Burundi could not comment about the new tax regime in the neighbouring country.