The Government of Rwanda has announced plans to increase incentives for manufacturers as part of a wider plan to boost an economic recovery for the private sector that was hit hard by COVID-19.
Prime Minister Édouard Ngirente, said on Thursday that due to COVID-19 restrictions businesses were negatively impacted and thus a need to revive the sector under a new fund- Manufacture and Build to Recover Program”(MBRP).
Ngirente told the parliament Thursday that the fund will complement an earlier Economic recovery Fund (ERF) worth Rwf100billion initiated last year with intent to cushion pandemic shocks in the tourism and hospitality, manufacturing (including agro processing), education, transport and logistics and SMEs in the local and global supply chain link.
“To support the Country’s economy to recover, government established the Economic Recovery Fund and Rwf100billion were injected in the fund and by 2021 it will be increased to Rwf350billion,” Ngirente said.
Ngirente said that the government designed the Manufacture and Build to Recover Program to fast track private sector investments in manufacturing and construction.
“The Manufacture and Build to Recover Program aims to fast track private sector investments in manufacturing and construction. It will play a big role in reducing the cost of setting up industries of essential products as well as facilitate expansion of small and medium businesses,” Ngirente stated.
The Manufacture and Build to Recover Program will also come with incentives such as tax exemption on imported construction materials not available in the East African region, as well as those sourced locally and performance incentives which include reduced tax rates on pay as you earn (PAYE) for new jobs and tax credits on export revenues.
However construction material incentives will be applicable to a minimum investment of $10million, while manufacturing incentives applicable for new projects with not less than $1million in investment, and $100.00 in investment for new agro-processing firms.