Utexrwa, the oldest local fabric manufacturer, is revamping its operations after winning a lucrative tender from Rwanda Defence Forces (RDF) to make army uniforms.

The company is also being urged to manufacture more for the local market due to a sharp reduction in importation of second-hand clothes — which have been the main source of clothing for the biggest segment of the population.

“This month we won the RDF contract and it is a positive development for us because we had lost it in 2009,” said Ritesh Patel, the managing director of Utexrwa.

The company expects to produce up to 70,000 uniforms per year for RDF as well as 100,000 uniforms for motorists per year.

They also make uniforms for the Rwanda National Police, the Diana Fossey Foundation rangers among other clients.

However, the company is still unable to produce affordable clothing to meet increasing domestic demand, following a recent government decision to charge higher taxes on imported second-hand clothes.

Lack of options

For a long time millions of Rwandans have depended on imported second-hand clothes, but the 2016 tax disincentive has left many without many clothing options.

A low-income earner in Nyamashekye could get clothes for as low as Rwf500, but now new imported clothes are expensive and the lowest price is Rwf3,000.

A shirt made by Utexrwa sells for Rwf4,500 in the market, which Mr Patel says is still expensive compared with second-hand shirts even with the prohibitive taxes imposed on them.

C&H, a Chinese garment manufacturer based in the special economic zone also said they have started producing clothes for the local market, but their products are also still considered costly.

Habimana Bienvenue, a cloth seller in Giporoso Remera, said many of his clients still ask for second-hand clothes because of the quality and price.

Mr Patel said Utexrwa is working with local retailers and has also opened up outlets in Kigali’s commercial centre.

He said the prices of the clothes they make remain high compared with other local options because they import almost everything they use to make the garments. He said increased production will see prices reduce.

He added that Rwanda being landlocked has made transport costs very expensive for them, since most of their raw materials are imported.

Waiver

Utexrwa buys its cotton from Uganda and Tanzania, its chemicals are from India, dyes from Europe, Polyester from China, India and Indonesia, which all drive up costs.

The government waived all import duties from raw materials used in local footwear and textile industries, but this has not been enough to bring prices down.

Last year, the company made an annual turnover of $1 million and is banking on existing contracts and the progressive reduction of second-hand clothes in the country, to further strengthen its capacity to serve the local textile demand.