Discusses key economic indicators and trade statistics, which countries are dominant in the market, the U.S. market share, the political situation if relevant, the top reasons why U.S. companies should consider exporting to this country, and other issues that affect trade, e.g., terrorism, currency devaluations, trade agreements.
Last Published: 7/11/2019
Rwanda is a small but growing market, with a population of 12.2 million people and a Gross Domestic Product (GDP) of USD 9.14 billion dollars, according to the World Bank.  Rwanda enjoys strong economic growth, averaging over seven percent annually over the last two decades.  The Rwandan economy grew more than eight percent in 2018 as higher global prices for some traditional exports, improved agricultural output, growth in transport and tourism, and a rebound in construction activities helped the country to recover from drought and a cyclical downturn in 2016.  The International Monetary Fund (IMF) expects Rwanda’s Real GDP to grow between 7-8 percent in 2019 and 2020.  There are many positive big picture economic signs:  inflation was below five percent in 2018, the country maintains its reputation for low corruption, Rwanda's debt-to-GDP ratio, at 47.1 percent is relatively low (but growing quickly), and the percentage of foreign assistance (external grants and loans) in the country’s annual budget has dropped from over 80 percent a decade ago to 32.4 percent in the 2018/2019 National Budget.  Rwanda enjoys relatively high rankings in the World Bank's Ease of Doing Business Index, which ranked Rwanda 29th out of 190 economies in the 2019 report—second-best in sub-Saharan Africa behind Mauritius.

Leading sectors include energy, agriculture, trade and hospitality, and financial services.  Rwanda’s economy is overwhelmingly rural and heavily dependent on agriculture.  Strong growth in the services sector, particularly construction and tourism, has contributed to overall economic growth.  GDP per capita was USD 830 in 2018, according to the IMF.  The government’s economic priority is turning Rwanda into a regional trade, logistics, and conference hub.  Pillars of this strategy include the construction of several new international business class hotels, a convention center in downtown Kigali, a brand new inland container terminal and bonded warehouse in Kigali, and expanding and investing in the fleet for the national carrier RwandAir.  Construction of the new Bugesera International Airport is ongoing, with the first phase scheduled to begin operation in 2021.

Rwandan exports increased by 5.5 percent year-on-year in 2018, reaching USD 995.7 million, according to the National Bank of Rwanda. Commodities, particularly gold, tin, tantalum, tungsten, tea, and coffee, generated over 57 percent of Rwanda’s export revenue.  Rwanda earned USD 90.5 million from tea exports in 2018, a 7.4 percent increase from 2017.  Over the same period, coffee accounted for USD 68.7 million worth of exports, up 7.2 percent from the previous year.  Major markets for coffee exports are the United States and Europe, while the Middle East and Pakistan are the main buyers of Rwandan tea.  Tourism is the country’s leading foreign exchange earner, with total revenues estimated at USD 438 million in 2017, according to the Rwanda Development Board (RDB).  This is due to successes in leisure tourism as well as smaller but rapidly growing business tourism, also known as Meetings, Incentives, Conferences and Events (MICE).
 
Rwanda’s small industrial sector contributes around 16 percent to GDP and employs less than three percent of the population.  The services sector – including tourism - generates almost half of GDP (47 percent) and has grown at an average annual rate of around eigtht percent in recent years.  Rwanda is highly import-dependent, and the Rwandan government faces chronic and large current account deficits.  In 2018, imports totaled USD 2.425 billion compared to USD 2.215 billion in 2017, an increase of 9.5 percent due to ongoing large infrastructure projects and growing industry.  Import of capital and intermediary  goods increased by 10.4 percent and 12.4 percent respectively between the last two years according to the National Bank of Rwanda (BNR).  In 2017, principal imports included electrical machinery and parts; electronic equipment and parts; machinery appliances and parts; vehicles and accessories; cereals and other food stuff; pharmaceutical products; cement and construction equipment including iron and steel; and energy and petroleum products.  China, Europe, Uganda, Kenya, India, the United Arab Emirates, and Tanzania are among Rwanda’s major suppliers.

U.S.-Rwanda bilateral trade has grown rapidly in recent years.  After Rwanda implemented new higher tariffs on imports of secondhand clothing and footwear in 2016, the U.S. government partially suspended African Growth and Opportunities Act (AGOA) benefits for apparel products from Rwanda, effective May 2018.  Many other Rwandan exports to the United States are still eligible for trade preferences under the Generalized System of Preferences and AGOA.  Rwandan exports to the United States have grown over 150 percent from 2010 to 2018.  U.S.-Rwanda bilateral trade in 2018 totaled USD 92.7 million (USD 25.3 million in exports to Rwanda, USD 67.4 in imports from Rwanda) compared to 109.8 (USD 66.1 million exports to Rwanda and USD 43.7 million imports from Rwanda) the year before; the decline is mostly due to fewer aircraft exports.  Top U.S. exports to Rwanda include aircraft and parts; mechanical and electrical machinery and related parts; and medical, pharmaceutical, and scientific equipment and products.

Less than seven percent of Rwanda’s total goods exports went  to the United States in 2018.   USD 3.86 million in total Rwandan exports to the United States came under AGOA, primarily apparel, travel goods, handbags, and arts and crafts (up from USD 2.16 million in 2017, 1.22 million in 2016 and USD 435,000 in 2015).

In 2007, Rwanda joined the East African Community (EAC).  Rwanda is also a member of the Common Market for Eastern and Southern Africa (COMESA).  Rwanda is the only nation in the region to have concluded a Bilateral Investment Treaty (BIT) with the United States.  Rwanda has also concluded a Trade and Investment Framework Agreement (TIFA) with the United States.  In 2009, Rwanda became the newest member of the Commonwealth and is scheduled to host the Commonwealth Heads of Government meeting in 2020.  Rwanda joined the OECD Development Center in 2019.

Rwanda is  a member of  the Northern Corridor initiative, which includes Kenya, Uganda, South Sudan, and Ethiopia as core members and the Democratic Republic of the Congo (DRC), Burundi, and Tanzania as observers.  Rwanda is also at the forefront of the Central Corridor initiative, which also includes Burundi, DRC, Tanzania, and Uganda.  Unlocking some of the larger infrastructure projects, such as rail transportation, envisioned under the these initiatives could help to reduce the cost of conducting business and transporting goods across the region.Rwanda benefits from low violent crime rates; its strong police and military provide a security umbrella that minimizes potential criminal activity and political conflicts. 

Leading reasons to consider the Rwandan market for U.S. export expansion include:
  • Sustained high economic growth: Strong average year-on-year GDP growth albeit from a low base, relatively low inflation, low (but growing) debt-to-GDP ratio;
  • Low corruption:  One of Africa’s four least corrupt nations and 48th in the world in the Transparency International’s 2018 Corruption Perception Index;
  • Easy to start a business: Top global consistent reformer since 2008 (World Bank Doing Business Report), 2nd easiest place to do business in sub-Saharan Africa.  Investors can register a business online or in person in as fast as six hours through the Rwanda Development Board.
  • Access to markets:  Rwanda’s market of 12.2 million people has a growing middle class, plus a market and customs union with a market potential of 162 million consumers in the EAC.  Close access to the eastern DRC market of approximately 35 million people.
  • Untapped investment opportunities:  Potential opportunities for investment are particularly attractive in the following sectors: infrastructure, energy, agriculture, tourism, manufacturing, information and communication technology, mining, financial services, real estate, and construction.

Summary of Basic Economic Statistics (2016/2017 figures)
Population Total :12,208,407 (2017 World Bank)
Real GDP growth :8.6 percent (2018)
GDP at current prices :
 		USD 9.135 billion (2017 World Bank)
RWF 8,190 billion (2018 National Institute of Statistics Rwanda (NISR))
GDP per capita:USD 830 (2018 IMF)
Consumer price inflation:CPI increased by 1.1 percent on average between December  2017 and December 2018.
Total Exports:USD 995.7 million (2018 BNR)
Total Imports:USD 2,425 billion (2018 BNR)
Exports to the USA:USD 67.39 million (2018 USTC)
Imports from the USA :USD 25.33 million (2018 USTC)
Exchange rate:900 RWF on May 11, 2019

 
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.


More Information

Rwanda Trade Development and Promotion