Rather than pursue tax exemptions on apparel exports to the US that were suspended under the African Growth and Opportunity Act, Rwanda will focus on other products and investment opportunities with Washington.
“We have a strategy that looks at how we can develop other value chains; we have earmarked home décor, fashion & design and specialty foods like roasted coffee and honey,” said Robert Opira, the director-general of trade and investment at the Ministry of Trade and Commerce.
“It is only textile that was affected the rest are still benefiting from the exemption.” In July 2018, President Donald Trump suspended duty-free access to the US market for Rwanda’s apparel exports, after the latter slapped a prohibitive tax on secondhand textile and footwear imports.
Since the suspension, Rwanda has had several trade engagements with the US, with the most recent being the fifth Trade and Investment Framework meeting (TIFA), which happened on October 31.
One of the items on the agenda was to collectively come up with steps to maximise the remaining years of Agoa, which expires in 2025.
Mr Opira said that while tax exemptions on textiles may have been removed, the Agoa deal still gives Rwanda up to 4,800 tariff lines.
“Rwanda will now continue fasttracking the other value chains, and help the private sector take advantage of the US market,” he said.
A joint statement released after TIFA notes that both countries intend to strengthen commercial co-operation and develop short-term solutions to reduce barriers to trade and investment between them.
The countries agreed to renew bilateral engagements that will increase economic growth.
They also sought to identify other potential areas of collaboration to ensure that trade grows substantially while focusing on quality compliance and capacity building in other sectors.
The two countries discussed the establishment of an American Chamber of Commerce in Rwanda to promote trade and investment between Rwanda and the US. Rwanda exported goods worth $75 million to the US last year.
“There were no further discussions on apparel, the set up of the American chamber of commerce in Rwanda will be key in attracting more US investments and give a platform for US and Rwanda businesses to network and increase trade flows between them,” said the Minister of Trade and Industry Soraya Hakuziyaremye.
The two countries also agreed to explore ways to work together to support the negotiation and implementation of the African Continental Free Trade Area.