Home NewsNational Rwanda Motor Taxi Industry Generates $1 Billion Annually

Rwanda Motor Taxi Industry Generates $1 Billion Annually

by Dan Ngabonziza
4:32 pm

On a cool Tuesday morning, Edward Tuyisenge 30, arrives at Nyabugogo bus terminal from Ruyenzi town centre in the outskirts of Kigali, Rwanda’s capital.

The 30km ride from Ruyenzi in Southern part of Rwanda to Kigali, is part of Tuyisenge’s daily routine.

He rides 60km every day. “I hit this road every morning and evening. Kigali is the busiest destination for my business,” says the father of three.

Tuyisenge has been a motor taxi operator for the past 10 years; he says “Motor taxi business pays off. I look after my family, take children to school and save money for other investments,” he told KT Press.

In Ruyenzi town centre, Tuyisenge owns a sizeable residential house and two commercial buildings.

“I built these houses from savings I got from this business,” he says.

Like Tuyisenge, Rwandan motor taxi operators contribute enormously to Rwanda’s economy, despite their profession regarded as ‘cheap’ business to many in the country.

Motor Taxi transport is affordable and most used form of transport across the country.

Motor Taxi transport is affordable and most used form of transport across the country.

A billion dollar business

A chilling investigation conducted by KT Press, indicates that motor taxi transport industry is worth Rwf726 billion ($1 billion) annually.

This is worth a total grant the World Bank Group recently committed to Rwanda in the next five years.

According to FERWACOTAMO,an umbrella organization for 240 motor taxi cooperatives, there are 78,000 known members.

Each cooperative pays Rwf160, 000 as taxes annually, amounting to Rwf38, 400,000 ($54, 000) from the 240 cooperatives.

Now, every motor taxi operator is required to commit Rwf300 daily to FERWACOTAMO, yet for every three months, each driver pays Rwf18, 000 as taxes, equivalent to Rwf72, 000 ($100) per year.

KT Press established that on average, a motor taxi operator can generate Rwf25, 000 ($45) daily or more depending on the number of clients and working hours.

Jean Pierre Ndaruhutse 25, has been driving a motor taxi for six years in the capital Kigali.

“Normally, when I hit the road hard, I can take home more than Rwf40, 000($55) a day,” he says.

It is from this amount that Ndaruhutse services his motor cycle, buys fuel and saves the balance to take care of his family including; paying rent, buy food, clothing and cover other expenses.

KT Press has established that the annual taxes from the motor taxi business (Rwf6 billion) can fund an entire district budget.

According to the Ministry of Local Government, one district spends roughly Rwf8 billion.

Ironically though, the industry generates more revenues (Rwf712 billion) than revenues generated by Bank of Kigali, the country’s largest commercial bank, which makes Rwf21 billion as annual net profit.

Also, Bralirwa, the largest brewer, a conglomerate of Dutch-based Heineken group, does not come close to the motor taxi industry.  It makes just Rwf19 billion annual net profit.

The 78,000 motorbikes operating around Rwanda are largely distributed by Verma, an Indian-based company with offices in the country.

More so, the industry is also twice bigger than the country’s total 2014 exports, including minerals, cash crops and others, according to the National Institute of Statistics of Rwanda, were worth Rwf432 billion ($599.8 million).

There are about 78,000 motor taxi operators in the country. They contribute over $1Billion annually into Rwanda's economy

There are about 78,000 motor taxi operators in the country. They contribute over $1Billion annually into Rwanda’s economy

From ex-combatants, school drop-outs to motor taxi operators

According to available data from FERWACOTAMO, most categories of these motor taxi operators in Rwanda are ex-combatants in the Rwandan army, while others are school drop-outs.

“Almost 70% of motorists fall in that category,” Celestin Ntaganzwa, the president of FERWACOTAMO told KT Press.

Alexandre Karekezi, is a motor taxi operator in down town Kigali’s busiest Nyabugogo bus terminal.

He joined the business after being repatriated after spending years in Democratic Republic of Congo fighting for FDLR, a militia group responsible for the 1994 genocide against Tutsi that claimed a million lives.

“I realized staying with FDLR was a bad choice. I decided to surrender and return home where I was taken to a re-integration centre before joining the business,” he says.

Working for government and corporate institutions

Meanwhile, apart from generating high revenues, the motor taxi industry is also involved in social activities such as Umuganda (community work).

According to Celestin Ntaganzwa, the president of FERWACOTAMO, when all the members of the association take part in the exercise, their work is valued at Rwf100 million every year.

Motor taxi operators also facilitate government institutions to spread their campaigns across the country.

No deal can corporate companies in Rwanda successfully accomplish without taxi motor operators services.

These companies, especially those in the telecom sector like Airtel Rwanda, Tigo and MTN Rwanda, rock heads fighting to brand motor riders. In 2012 alone, Tigo Rwanda branded 11, 000 jackets to motor drivers in Nyarugenge district, Kigali city.

Much like Edward makes his fortunes from taxi motor business, Ntaganzwa told KT Press that: “We want to ensure the government sees us as big partners in development.”