„Made in Rwanda“
New Jobs in the Textile Industry

Rwanda has a clothing industry that is characterised by small and medium-sized enterprises. However, only a small proportion of the processed material comes from local production. When it comes to fabrics for the clothing industry, the country is heavily dependent on the imports. Most of the garments that are sold, also come from manufacturers abroad. Only a few are made in Rwanda, the rest are imported - mainly from China, India and the USA. The country's government has been pursuing a ‘Made in Rwanda’ strategy since 2017 and is promoting the local textile industry through tax breaks and an exemption from import duties. At the same time, the import of second-hand clothing has become more expensive due to higher customs duties. The aim is to make local manufacturers more competitive and create jobs at home. Government agencies have been instructed to favour local manufacturers when procuring school and police uniforms as well as equipment for the security forces. The improved market environment is making the domestic production of textiles increasingly attractive.

The Rwandan partner company Janiya Investment has around 200 employees and has been producing garments for the Rwandan market in Muhanga, south-west of Kigali, since 2019. With a market share of around five per cent, Janiya Investment is one of the top 10 textile companies in Rwanda. The processed fabrics have so far been imported from Kenya, Uganda, China and India. In order to expand production and be able to produce its own fabrics in future, a knitting mill and a textile factory are now being built in the Muhanga Industrial Park It will be able to sew over 1 million garments a year at full capacity. In future, the garments will also be exported to neighbouring countries. Online sales to end customers are also being planned. Around half of the fabrics produced in-house are to be sold to other textile manufacturers in Rwanda, who will also be able to reduce their purchasing costs. Producing its own fabrics shifts important steps in the value chain to Rwanda and will also have a positive impact on other companies in the industry.

Janiya Investment plans to invest a total of EUR 2.6 million in this project. The Facility Investing for Employment is providing a grant of EUR 1.25 million (48 per cent). These funds will primarily be used to finance the construction of the new factory and the purchase of knitting machines.

163 new jobs will be created in the knitting and sewing departments as well as in administration. Around three quarter of them will be for women. Most jobs will be created after completion of the investment phase, which will last a maximum of three years. The employees will have access to social benefits such as pension and health insurance, paid holiday and maternity leave via employment contracts subject to social security contributions. The new production facilities will be significantly more modern than those currently in use and will also have a canteen and break rooms. This will also improve the working conditions for the workers who are already employed at the company. Six-month training programmes are planned for the new employees to teach them how to operate the modern machines.

The textile companies that will source their fabrics from Janyia Investment in future, will also become more competitive. It is expected that they will create more than 150 additional jobs as a result. Several of them have signed letters of intent to this effect. The grant agreement with Janiya Investment was signed in September 2024.

The Facility Investing for Employment (IFE) of KfW Development Bank is part of the Special Initiative "Decent Work for a Just Transition" of the German Federal Ministry for Economic Cooperation and Development (BMZ). With its support, the Facility wants to remove barriers that prevent the creation of new and better jobs in the private sector.