Consumers will have to dig deeper into their pockets to buy goods imported from China and other Asian countries, thanks to coronavirus disruptions that caused shortage in the country.
As manufacturers in China, Malaysia and other Asian countries suffered prolonged shutdowns due to the pandemic last year, most consumer goods are scarce.
And upon resumption of manufacturing, the Chinese population bought most of the goods produced, and demand that ensued led to a sharp rise in prices, a pain already felt by Rwandan consumers.
Among the imported goods whose prices shot up include clothes and foot wear and electronics “Consumer goods prices have significantly increased due to a sharp demand for Chinese goods in China because their industries spent months not producing, we have no option but increase prices also, this is a pain to our consumers but there’s nothing to do” said Aphrodis Mpayimana, an importer and president of Rwanda importers.
“Prices have increased almost by 40 percent which is unprecedented, and it is not getting any better,” he said.
The scarcity and high demand for Chinese manufactured goods in China has also led to shortage in local markets compounded by the fact that many importers in Rwandan have thrown in the towel after losing money last year.
The back to back restrictions and lockdowns during which which dealers in non-essential goods were not allowed, led to collapse of some import businesses which exasperated problems in the supply side of the market.
Mr Mpayimana said since importers could not travel to China for months last year, many relied on making remote orders, which exposed many to raw deals as some received goods that do not match orders they placed.
Some importers have made untold losses since by the time the ordered goods reach Kigali, there’s nothing that can be done.
“Many importers are still incurring losses because of erroneous or mismatching deliveries.” Although some logistical obstacles have been dealt with, and that the Coronavirus testing of drivers is more streamlined now, importers are still incurring extra costs due to existing logistical glitches.
“We are still experiencing delays at the customs, and these delays are attracting additional costs for us, which of course is reflected in our final pricing to the consumer,” said Mr Mpayimana.
Cooking oil from Malaysia which cost Rwf25000 before Coronavirus outbreak now costs Rwf36000, while a Chinese Techno phone which went for Rwf37000 now costs Rwf48000. He said they have also been subjected to additional taxes by the Tanzania authorities, which further exerts more financial pressures on importers.
In an interview with Joseph Akumuntu, the director of Rwanda Chamber of Commerce at Private Sector Federation and head ofbthe petroleum sector, he said the GPS tracking system has helped because it has minimised chances of truck drivers making unnecessary movements, which exposes them to risks of contracting the virus.
He noted that in a few days all truck drivers entering Rwanda will be tested at one location, and up to Rwf35000 will be paid by every truck to cater for the maintenance of these drivers at the location.
Tanzania authorities now accept Rwanda’s coronavirus test certificates, which wasn’t the case a few months ago.
The economic contraction as a result of coronavirus has led to a decline in disposable income among buyers, which has continued to shrink trader’s revenues.