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The Association of Customs Agents in Rwanda (ADR) StrategicPlan 2012 - 2016 A Voice for Clearing and Forwarding Agencies November 2012
The Association of Customs Agents in
Rwanda (ADR)
StrategicPlan
2012 -2016
A Voice for Clearing and
Forwarding Agencies
November 2012
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TABLE OF CONTENTS
TABLE OF CONTENTS .......................................................................... 2
EXECUTIVE SUMMARY ....................................................................... 4
LIST OF ABBREVIATIONS ................................................................. 10
CHAPTER ONE ...................................................................................... 12
1.0 INTRODUCTION ........................................................................................................................ 12
1.1 Preamble .................................................................................................................................. 12
1.2 The Strategic Planning Framework ............................................................................................ 12
1.3 Strategic Planning Methodology ............................................................................................... 13
1.4 Organization of the Plan ........................................................................................................... 13
CHAPTERTWO ........................................................................................ 2
2.0 ADR’s INSTITUTIONAL REVIEW .................................................................................................... 2
2.1 ADR’s Historical Overview ....................................................................................................... 2
2.2 ADR’s Objectives......................................................................................................................... 3
2.3 ADR’s Vision Statement ............................................................................................................. 3
2.4 Mission ....................................................................................................................................... 3
2.5 Core Values ................................................................................................................................ 4
2.6 Internal Analysis of ADR .............................................................................................................. 5
2.7 External Analysis of ADR ............................................................................................................. 8
2.8 Stakeholder Analysis ................................................................................................................. 13
2.9 SWOT Analysis .......................................................................................................................... 15
CHAPTER THREE ................................................................................. 19
3.0 THE CLEARING AND FORWARDING SECTOR .............................................................................. 19
3.1 Developments in the Clearing and Forwarding Sector ............................................................... 19
3.2 Development of Advanced Logistics Service Providers .............................................................. 19
3.3 The Freight and Forwarding Industry in Rwanda ....................................................................... 20
3.4 Rwanda’s Logistical Challenges ................................................................................................. 21
3.5 Rwanda’s Import and Export ..................................................................................................... 22
3.6 The State of Air Cargo Services Market...................................................................................... 23
3.7 Proposed Strategic Developments ............................................................................................ 24
3.8 New Generation Trade Facilitation Instruments ........................................................................ 24
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CHAPTER FOUR ...................................................................................... 2
4.0 STRATEGIC FOCUS, OBJECTIVES AND STRATEGIES .......................................................................... 2
4.1 ADR’s Distinctiveness / Value Proposition .................................................................................. 2
4.2 ADR’s Key Strategic Areas ........................................................................................................... 2
4.3 ADR Desired State in 5 years ....................................................................................................... 3
4.4 ADR’s Strategic Orientation ......................................................................................................... 3
4.5 Strategic Goal ............................................................................................................................. 4
4.6 Strategic Priorities ...................................................................................................................... 4
CHAPTERFIVE ........................................................................................ 2
5.0 IMPLEMENTATION OF THE STRATEGICPLAN .................................................................................. 2
5.1 Critical Success Factors ............................................................................................................... 2
5.2 Implementation Matrix ............................................................................................................... 4
5.3 Implementation Timelines ........................................................................................................ 11
5.4 Financial Projections ................................................................................................................. 13
5.5 Monitoring, Reporting and Evaluation ...................................................................................... 14
APPENDICES ...................................................................................................................................... 15
Appendix I: Proposed Organizational Structure ............................................................................. 15
Appendix II: Proposed Automated System for Secure Transit ............................................................. 16
Appendix III: References .................................................................................................................... 17
Appendix IV: Persons Consulted .................................................................................................. 18
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EXECUTIVE SUMMARY
Introduction
The Association of Customs Agents in Rwanda (ADR) is an autonomous apex body gathering
together more than 120 private companies working in clearing and freight forwarding business in
Rwanda. The clearing and forwarding environment in Rwanda and the region is fast changing as
a result of changes in the external environment including the need for supply chain efficiencies,
regionalization, globalization, improvements in technology, among others.
This Strategic Plan for the period 2012‐16 has been developed with the intention of providing the
organization’s strategic direction over the mentioned period. The ADR Strategic Plan helps in
identifying and selecting the most appropriate strategies to address the challenges, achieve
specified objectives, while taking into account the external environment in which ADR operates.
The strategy will also help in the coordination, implementation and monitoring of strategies set
in the clearing and freight forwarding industry.
Structure of the Strategic Plan
This strategy is built on five chapters starting with an Introduction followed by ADR Institutional
Review as chapter two; the third chapter is about the Clearing and Forwarding Sector in Rwanda;
the fourth chapter ison Strategic Focus, Objectives and Strategies, and; the fifth chapter presents
the Implementationof the Strategic Plan.
Strategic Planning Methodology
The ADR Strategic Plan was developed through a consultative process with different
stakeholders. Data for the plan was collected from various documents as well as from various
consultative meetings that were held the stakeholders of ADR. After the meetings, a draft
strategic plan was developed and was subjected to a review by ADR and later validated in a
workshop leading to this strategy document.
ADR’s Vision and Mission
ADR’sVision is to be an internationally recognized professional association of CFAs
facilitating import and export trade in the region; while its mission is to facilitate the
international import-export trade by providing a body of professional freight forwarding
agencies within Rwanda, committed to meeting every client's needs. During the planning
process, several core values to guide ADR were identified. These included: Honesty and
Integrity;Efficiency;Professionalism;Transparency;Member Orientation, and;Accountability.
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ADR’s Focus Areas
From the analysis of interviews and discussions with various ADR stakeholders, 4 strategic
Themes were identified central to the success of ADR. They include: Member Services (to focus
on membership issues); Advocacy (to focus on ensuring supportive policy and regulatory
environment is created to enable business performance); Professionalism (to focus on aspects of
professionalizing the industry), and; Institutional Strengthening and Sustainability (to focus on
building the Secretariat into a professional and sustainable institution).
ADR’s Strategic Direction
The goal of ADR for the next 5 years is to enhance its members towards achievement of
professionalism and competitiveness in the clearing and forwarding industry. In order to achieve
the goal, ADR will need to transform itself into a highly professional association with the ability
to set the agenda in the clearing and forwarding sector locally and in the region. It will also need
to ensure there is a professional, competitive and attractive sector through initiatives at
transforming the members from just clearing and forwarding agencies to integrated logistics
service providers.
ADR will achieve this by focusing on 4strategic priorities as follows:
1) To promote growth and prosperity of its members;
2) Increased interventions for advocacy of its members;
3) To promote professionalism of its members;
4) Institutional capacity building.
ADR’s Strategies
In order to achieve the four strategic prioritiesmentioned above, a set of strategies will be
pursued both in the short and medium-term. The strategies will lead to some expected outcomes.
Both the strategies and outcomes are highlighted below.
Promoting growth and prosperity of members: ADR needs to provide a range of services that
will not only benefit the members but also be sufficiently attractive such that members will
demand for the same. Towards this end, ADR will need to design a range of member services
including training – managerial, technical, training on standards and legal issues; advice and
consultancy – best practice benchmarking, digests of new regulations and implementation of the
same; information and networking, conferences, and meetings. ADR must establish micro-
enterprise development programmes to support the emergence and development of Small and
Medium Enterprises(SMEs) Clearing and Forwarding Agenciesand encourage positive and best
business practices. Such programs would support the SMEs in acquiring funds at a low cost and
even organizing the sector for a competitive Group Liability Insurance.
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In terms of member support services, it is expected that, within the 5 years the following results
will be achieved:
90% of the members will have received relevantmanagerial and technical training
Two new member value adding services/products are introduced every year
An annual member satisfaction index of 90% is attained
90% of member operational issues are resolved within 48 hours
Advocacy interventions: ADR should be able to design a coherent advocacy strategy. ADR
needs to position itself so that it is involved in every step of the legislative process of policies
that affect CFAs. In order to be effective in advocacy, ADR shouldenhance its capacity to speak
on behalf of the CFAs. It should also advocate for the reduction of various fees by service
providers; develop and produce policy and position papers on areas of common interest to the
sector; advocate for the removal of Non-Tariff Barriers and other administrative bottlenecks that
inhibit efficient business conduct; and, advocate for regional recognition of Rwanda CFAs.
In terms of advocacy, it is expected that, within the 5 years the following results will be
achieved:
A reduction in service fees/charges by service providers
A reduction of NTBs identified in any particular year
75% of members willoperate in strategic alliances with peers in the region or individually
in the EAC member states
Promotion of Professionalism: As an apex body, ADR should ensure there is professionalism in
the industry and that’s its members are able to undertake profitable business within the legal
provisions. In order to achieve this, ADR shouldensure that all its members: sign and observe the
code of conduct; have gone through the East African Customs and Freight Forwarding Practicing
Certificate(EACFFPC) certification and are Certified CFAs; and, are enrolled in a proposed
Continuous Professional Development program. Other initiatives to professionalize the sector
include: initiating an award of recognition for excellence in service delivery and performance
(The CFA of the Year and The Best Performing Certificate Student of the Year Awards);
developing collaborative relationships with Institutes of Higher Learning; developing a Resource
Center; and, introducing the FIATA Diploma at the ADR Training Centre.
In terms of professionalization of the CFA sector, it is expected that, within the 5 years the
following results will be achieved:
Attain full compliance with ADR Code of Conduct.
By end of 2013; each of the shareholders in CFAs and at least 1/3 of employees in each
CFA have attained the EACFFPC or a similar qualification.
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At least quarterly CPD courses will be conducted annually.
Achievement Awards will be conducted annually to recognize and encourage best
practice.
Institutional development of ADR training center.
Institutional Capacity Building: ADR should transform itself into an entity that is enshrined
and recognized by law as a Professional Association. ADR has to develop its institutional
strength and management capacities to become more effective and ensure its long-term
sustainability. The diversification of revenue streams, the provision of a steady cash-flow and the
ability to build reserves for periods of financial strain is an area of ADRs focus in the 5 year
Strategic Plan. ADR should also assign clear tasks and responsibilities to improve the work of
the staff members by implementing effective administrative systems. It must also ensure a strong
people orientation by recruiting and retaining competent and motivated personnel. Currently
there exist skills gaps amongst the employees who require to be capacitated on Advocacy Skills,
Resource Mobilization Skills including funding proposal development, Marketing Skills,
Customer Service Skills, among others. Other strategies will include implementing organization
structures, systems, policies and procedures; strengthening its governance systems; building
value adding networks and partnerships; strengthening the Corporate Image; developing a
Performance monitoring, evaluation and learning framework; improving on the communication
processes including the use of its website; among others.
In terms of organizational strengthening and sustainability, it is expected that, within the 5 years
the following results will be achieved:
The association will have transformed from a “trade association” registered under the
provisions of labour code, to a “professional association” with authority and ability to
regulate the conduct of its members.
Annual training programmes in corporate governance for the Board of Directors of the
association.
Secured Technical Assistance to the office of CEO of ADR, or recruited an independent
CEO with requisite to implement this strategic plan.
Adequate staffing in the core functional areas of the Association.
Gantt Chartof Key Results
Key Results
Year
1
Year
2
Year
3
Year
4
Year
5
Promoting growth and prosperity of members:
90% of the members will have received relevant managerial and
technical training
Two new member value adding services/products are introduced
every year
An annual member satisfaction index of 90% is attained
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Key Results
Year
1
Year
2
Year
3
Year
4
Year
5
90% of member operational issues are resolved within 48 hours
Advocacy interventions:
A reduction in service fees/charges by service providers
A reduction of NTBs identified in any particular year
75% of members will operate in strategic alliances with peers in
the region or individually in the EAC member states
Promotion of Professionalism:
Attain full compliance with ADR Code of Conduct.
Each of the shareholders in CFAs and at least 1/3 of employees in
each CFA attain the EACFFPC or a similar qualification.
At least quarterly CPD courses will be conducted annually.
Achievement Awards will be conducted annually to recognize
and encourage best practice.
Institutional development of ADR training center.
75% stakeholder satisfaction index to be achieved by end of 2014
Institutional Capacity Building:
The association will have transformed from a “trade association”
to a “professional association”.
Annual training programmes in corporate governance for the
Board of Directors of the association.
Secured Technical Assistance to the office of CEO, or recruited
an independent CEO.
Adequate staffing in the core functional areas of the Association.
Strategic Plan Implementation
The successful implementation of this strategic plan will depend on several factors including:
Ownership of the Strategic Plan: The overall ownership of this plan is with the
Executive Committee who will delegate responsibility for its implementation to the
Secretariat. The EC will ensure existence of an enabling environment for implementing
the strategy by creating, supporting and ensuring a strong Secretariat is in place.
Human Resources: The successful implementation of this strategic plan recognizes the
evolving internal functions and emerging external role of ADR in an integrated regional
market where its interventions will demand high level knowledge and skills as dominant
factors in its operations. In this context, the delivery of ADR’s mandate will depend on
ADRattracting and retaining skilled and competent staff. In addition, it will need to ensure
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that continued effective coordination remain a key and overarching approach in all aspects
of its work. In order to ensure this, ADR will need to secure capacity building support
both financial and technical.
Monitoring and Evaluation: During the strategic implementation period, ADR will require
to assess its performance based on the expected outcomes. As a result, the successful
implementation of a Performance Monitoring, Evaluation and Learning framework will be
critical for ensuring that the planned activities were carried out in an efficient and effective
manner and that the desired results are achieved with deviations if any addressed in time.
Financial Resources: For successful implementation of strategy, budgets/resources should
be linked to strategy. This calls for ADR to put in place effective strategies for the
mobilization of adequate resources. In order to support the implementation of the strategic
plan, a budget of RWF 916,000,000 Millions is proposed as indicated in the table below:
No Strategies Budget (RWF)
1 Training programmes toward EACFFPC certification and
similar qualifications 16,000,000
2 Study missions and benchmarking with peers, prepare members
for Single Customs Territory (SCT), etc 58,000,000
3 Stakeholder and member satisfaction surveys 25,000,000
4
Public-Private Partnership (PPP) workshops and advocacy
forums about reduction of NTBs and other administrative
hurdles, trade facilitation, access to Mombasa and Dar ports for
Rwandese Operators, etc
111,000,000
5 Continuous professional development (CPD) training
programmes for ADR members 53,500,000
6
Enforcement of Code of Conduct and regular Quality
Assurance reviews (oversight function), and best practice
recognition programme.
49,000,000
7 Institutional Capacity building and accreditation of ADR
training centre 156,500,000
8 Transformation of ADR from a “trade association” to a
“professional body” 40,000,000
9 Enhancement of corporate governance and Technical
Assistance to ADR Secretariat 35,000,000
10 Improvement in communication systems and practices between
ADR and its stakeholders; including internally with members. 72,000,000
11 ADR Head Office project 300,000,000
Total 916,000,000
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LIST OF ABBREVIATIONS
3PL: Third-party logistics provider
4PL: Fourth-party logistics provider
ADR: Association des Agences en Douane du Rwanda (Association of Customs Agents
in Rwanda)
ASYCUDA Automated System for Customs Data
ASSET: Automated System for Secure Transit
BMO: Business MembershipOrganization
CEPGL: Communauté Economique des Pays de Grands Lacs
CFAs: Clearing and Forwarding Agencies
COMESA: Common Market for Eastern and Southern Africa
CPD: Continuous professional Development
EABC: East African Business Council
EAC: East African Community
EACFFPC: East Africa Customs Freight Forwarding Practicing Certificate
EACFFPC: East African Customs and Freight Forwarding Practicing Certificate”
EARA: East African Revenue Authorities
EC: Executive Committee
EDPRS: Economic Development and Poverty Reduction Strategy
ES: Executive Secretary
ETI: Enabling Trade Index
FEAFFA: Federation of East African Freight Forwarding Associations
FIATA : Fédération Internationale des Associations de Transitaires et Assimilés
FLPs: Freight Logistics Providers
GDP: Growth Domestic Product
GoR: Government of Rwanda
ICT: Information Communication and Technology
IT: Information Technology
JICA: Japan International Cooperation Agency
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M&E: Monitoring and Evaluation
MINEAC: Ministry of East African Community
MNICOM: Ministry of commerce
MoU: Memorandum of Understanding
NGO: Non-Governmental Organization
NTBs: Non-Tariff Barriers
OSBP: One Stop Border Posts
PMEL: Performance Monitoring Evaluation
PSF: Rwanda Private Sector Federation
RBS: Rwanda Bureau of Standards
RRA: Rwanda Revenue Authority
RURA: Rwanda Utilities Regulation Agency
SEZ: Special Economic Zone
SMEs: Small and Medium Enterprises
SCT: Single Customs Territory
STC: Standard Trading Conditions
SWOT: Strength Weakness Opportunity Threats
SWS: Single-window system
TMEA: Trade Mark East Africa
TNA: Training Needs Analysis
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CHAPTERONE
1.0 INTRODUCTION
1.1 Preamble This is a five year strategic plan for the Association of Customs Agents in Rwanda (ADR) and
aims to provide the organization’s strategic direction over the period 2012 to 2016. It is the first
ever strategic plan for ADR and captures ADR’s aspirations in the shorter and long-term. The
development of the plan was informed by various developments taking place in the region and
the need to develop a sector that lives the spirit of regional integration. Inputs to the plan were
provided by different stakeholders, both internal and external of ADR.
1.2 The Strategic Planning Framework Based on the need for ADR to play its rightful role as enshrined in its statutes, it was prudent that
ADR should review its strategic direction so that it can focus on more sustainable value adding
engagements for the betterment of its membership, self, stakeholders and partners. The ADR
strategic plan will be used in various ways including:
As a management tool.
To help ADR do a better job - to focus its energy, to ensure that its stakeholders and
employees are working towards the same goals,
To assess and adjust ADR’s direction in response to changing global and regional
political, technological and economic environments.
To offer a disciplined effort to produce fundamental decisions and actions that will shape
and guide what ADR is, what it does, and why it does it, with a focus and orientation on
the future and creation of impacts through its activities.
Through the Strategic planning process, a number of questions were addressed including:
Where is ADR now? (Current Situational Analysis)
Where does ADR need to be? (Gap/Desired Situation/Vision)
How will ADR close the gap (Strategic Orientations/Game Plan)
How will ADR monitor progress (M&E)
The strategic planning conceptualization identifies the level to which any efforts at planning
should aspire to reach. For ADR, to deliver on its mandate, it should develop to levels of
authority in the clearing and forwarding sector and in the logistics sector at large. As
conceptualized, Business Membership Organization (BMO) develop through four phases from a
“club”, “small secretariat”, “professional secretariat” to a “knowledge supplier”. ADR is
envisioned to be at Level 2 and as such the intention is to develop ADR to be a Level 4 BMO
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(Knowledge supplier) as indicated in the diagram below.
Phase of Development of a Business Membership Organization
Source: World Bank (2005)
1.3 Strategic Planning Methodology The strategic plan was developed through a consultative process. Initial consultative
meetings were held between the consultants, TMEA and ADR. The objective of the
meeting was to plan and initiate the planning process. A second meeting was held with
ADR’s Executive Committee and selected members whose purpose was to introduce the
assignment to the key stakeholders of ADR and drive support and ownership of the
process. Data for the plan was collected from various documents as well as from various
consultative meetings that were held with different stakeholders of ADR. The consultative
meeting involved ADR’s leadership and employees, individual members of ADR, TMEA,
FEAFFA, relevant government institutions and departments, and other individuals and
institutions as was determined during the inception meetings. After the meetings, a draft
strategic plan was developed and subjected to review by ADR and later validate in a
workshop whose participants included various ADR’s stakeholders.
1.4 OrganizationofthePlan Thisstrategicplanisdividedintothe followingfive chaptersasfollows:
Chapter One: Introduction
Chapter Two: ADR’s Institutional Review
ChapterThree: The Clearing and Forwarding Sector
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ChapterFour: Strategic Focus, Objectives and Strategies
ChapterFive: Implementation Plan
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CHAPTERTWO
2.0 ADR’sINSTITUTIONAL REVIEW
2.1 ADR’s Historical Overview Founded in 1998, the Association of Customs Agents in Rwanda (ADR) is an autonomous civil
society organization bringing together over 120 private companies engaged in the business of
customs clearing and freight forwarding in Rwanda. Its creation and development has been
shaped by the historical background of the customs clearing and freight forwarding services in
the country. Before the 1994 war and genocide, and during the immediate ensuing years, there
were only a handful of companies providing the services of customs clearance and freight
forwarding; and most of them operating under franchise of well-established international brands.
The advent of Rwanda Revenue Authority in 1997 was followed, almost spontaneously, by
hundreds of individuals and companies offering customs clearing services; and most of them
lacking the relevant skills and experience. Consequently, it immediately became apparent that
efficiency and ethical conduct were major gaps in service delivery. This prompted the
government, through Rwanda Revenue Authority, to regulate the sector through registration and
specific licensing of the Clearing Agents, requiring performance bonds and possession of specific
skills and experience. This major change in the sector prompted the existing service providers to
rethink their modus operandi and, with encouragement from Rwanda Revenue Authority,
founded ADR.
Primarily, ADR was initiated to provide advisory support to its members, advocate and represent
members in matters dealing with government and professionalize the clearing and freight
forwarding industry in Rwanda. In pursuit of these goals, the Association has over the years
steered improvements in the sector through key policy decisions, organizational capacity
building initiatives, and members’ skills enhancement. In May 2008, ADR launched the East
African Customs and Freight Forwarding Practicing Certificate” (EACFFPC) training
programme for its members towards a formal professional qualification in customs and clearing.
This qualification is pursued over a six month period and is based on a harmonized curriculum
jointly developed by the East African Revenue Authorities (EARA) and FEAFFA (the
Federation of East African Freight Forwarding Associations).
Currently, ADR is governed by a five-person Board of Directors, headed by a President, elected
by the General Assembly of members for a renewable term of two years. The meetings of the
Board take place in monthly intervals, and anytime need arises. The Board is supported by a
Secretariat located in Kigali headed by an Executive Secretary who is supported by four head
office staff and five working at border stations.
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ADR is a member of various organizations locally, regionally and internationally. ADR is a
founding member of the Rwanda Private Sector Federation (PSF), the Federation of East African
Freight Forwarders Associations (FEAFFA) and the through FEAFFA, ADR affiliates with the
Fédération Internationale des Associations de TransitairesetAssimilés (FIATA) which is the
global body of clearing, freighting and forwarding. It is also a member of the East African
Business Council.
2.2 ADR’sObjectives The overall aim of ADR is to encourage best practices in the industry and promote
competitiveness of companies to provide unrivalled quality services in the region and beyond.Its
objectives are as follows;
Serve as a framework for permanent dialogue between its members and third parties,
including public authorities
Enhance solidarity and mutual assistance between its members
Defend interests of members and represent them to third parties
Organize trade events in or outside the Country and promote members' participation In
commercial events organized by third parties
Promote training of members and of their employees
Foster good relations with associations whose objectives are, directly or indirectly,
similar to those set out above.
2.3 ADR’s Vision Statement A vision statement is a vivid idealized description of a desired outcome that inspires, energizes
and helps create a mental picture of a desired target. It defines where the organization wants to
be in the future. In formulating the vision statement ADR took into consideration a statement that
should be inspirational and has a call to action. ADR’s vision is identified as:
“To be an internationally recognized Professional Association of CFAs facilitating
import and export trade in the region.”
2.4 Mission The mission identifies the reason or purpose an organization exists. It expresses what the
organization intends to provide to its key stakeholder in view of the Vision Statement.
ADR’smission is:
To facilitate the international import-export trade by providing a body of professional
freight forwarding agencies within Rwanda, committed to meeting every client's
needs.
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2.5 Core Values The core values are derived by considering what behaviour and attitudes should be practiced and
embraced in order to create the desired culture to drive ADR’s vision. They are the system of
shared values and norms in an organization setting. ADR recognizes that having the right values
will result in more efficiency, higher productivity, and better focus. The ADR’s valuesinclude:
Honest and Integrity
o To build trust with those we serve, both inside and outside the ADR. This involves
knowing and doing what is right regardless of personal cost. ADR is committed to
observe absolute honesty and integrity in all our business activities. Integrity shall be
at the core of ADR’s activities and operations. The success of ADR will be based on
earning the member’s and other stakeholders trust which will inspire confidence in
the services offered by ADR.
Efficiency
o To ensure that our resources provide the maximum benefits to the members. As
ADR, we have a duty to provide effective and efficient services to our customers and
stakeholder’s thorough efficient utilization of our resources to ensure that our staff
are supported to deliver effective advocacy, policy advice and member’s services.
Professionalism
o To promote a passion for efficiency and quality in the service we provide and
consistently performing to high standard. As ADR, we shall exercise high levels of
professionalism in our work and reward merit. We shall use the most appropriate
skills and competencies, continually seeking opportunities to improve through
innovative approaches. We shall work collaboratively towards our common goal of
serving our members regardless of individual roles or functions and apply the same
ethos with our stakeholders and partners.
Transparency
o To ensure that all our undertakings are above board. ADR will ensure a full, clear
and timely disclosure of relevant information to members and will encourage
member scrutiny of processes and practices.
Member Orientation
o To ensure quality service delivery and member growth. We shall focus on meeting
the needs of members. ADR shall ensure specific customer satisfaction standards
and will actively monitors member satisfaction, taking steps to clarify and meet
member needs and expectations. ADR will ensure courteous and timely
responsiveness to the requests of its members.
Accountability
o Delivering what we promise to deliver. We value integrity and are committed to
be responsible of resources and risks entrusted to us by our members and
Stakeholders in order to give a fair return for their investments and trust in us.
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2.6 Internal Analysis of ADR
2.6.1 GovernanceandManagementStructure ADR is governed by an Executive Committee (EC) made of 5 members who are elected by the
GeneralAssembly. TheAssociationelectsitsrepresentativestotheExecutive
Committeeeverytwoyears,mandatingthemto provideleadershipandoverseetheday-to-dayworkof
theSecretariat.TheExecutiveSecretaryof ADRis appointedbytheExecutive Committee,andis
responsibleforthedayto dayrunningandexecutionofthe policiesoftheorganization. The EC is
guided by the constitution which has been under review. The EC does not have Corporate
Governance manual and therefore there is no clear demarcation between the roles and
responsibilities of the board and those of the secretariat. The board does not also have a
performance management system.
The Executive Secretary (ES) of ADR manages the Secretariat made up of 13 employees.
Three of the employees including the ES were based in the Head Office. These included the
Finance and Administration Officer, the Information Technology Officer and the Financial
Assistant. It had another 8 employees located in the borders – 2 at Rusimo Border, 3 at Gatuna
Border, and 1 each at Akanyaru, Gisenyi and Rusizi Borders. Through a technical support by
TMEA, ADR has a Training Coordinator tasked with managing training and ensuring that the
EACFFPC training course increases its annual enrollment to over 100 trainees.
As a lean Secretariat, ADR lacks any officer with sectoral expertiseother than the ES who was
a founder member of ADR and had experience in the freight and forwarding sector. Critical
capacity gaps lack among the employees including advocacy skills, member services
development, marketing skills, consultancy skills, communication skills, position and policy
papers writing skills, among others.ADR does not have any systematic personnel development
plans and therefore the employees are not exposed to training that would make them better
performers. Just like with the EC, there is no performance management system in place for the
employees. Accordingly, the secretariat lacks in capacity in most of the areas that would make
it deliver on its mandate. The employee remuneration and benefits are deemed not be at a level
comparable with peers and therefore ADR is unable to attract and retain a high caliber of
employees. Other than the salary there were no any employee benefits. Lack of any benefits
and low remuneration has meant employees have very low motivational levels.
2.6.2 FinancialPerformance ADR derived most of its revenues from membership subscriptions and from transit bonds.
However, it had some other sources of revenues which could be grown further to contribute
substantially to ADR. These sources included training fees andhire of the conference facilities.
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However, the ability of ADR to generate revenues is limited by the legal nature of the
Association. As registered, ADR cannot trade by having businesses that continuously generate
revenues. It is as a result of this and for financial sustainability that ADR will require as a matter
of priority to be transformed and registered as a Professional body/association.
In the last 2 years, ADR expenditure had far exceeded its revenues. This could be attributed to a
small base of funding sources which has been declining over the years. ADR is at a vulnerable
position in as far as finances are concerned. The 2 major sources of funding are at risk and may
not be sustained over a long period of time. This is because the revenues collected could face a
threat as there is no legal mandate for ADR to levy the said fees. The same could be challenged
in a court of law. It is therefore important that ADR develops appropriate fund raising strategies
that will ensure financial sustainability through diversified sources of funding.
ADR over the years had accumulated some reserves which had been invested in Fixed Deposits.
The fixed deposits earned some interest to ADR. In terms of financial management, ADR has a
finance and administration officer who keeps the books of accounts for the Association. ADR
uses financial software that enabled the tracking and accounting of funds. In terms of Audit,
ADR had an internal and external auditor. The internal auditor is an individual co-opted by the
Executive Committee and worked closely with the Treasurer.
2.6.3 Office Infrastructure ADR operates from rented premises which house its Secretariat and the Training Centre. Due to
the amount of space rented, ADR foots a huge rental bill that requires the rethinking of the
sustainability of that arrangement. An ideal situation would be for ADR to consider owning a
building that could house both the offices and training centre with excess space rented out to
members for an income. The offices at the secretariat are well equipped with all the office
equipment required. A website with member information is available and the secretariat uses
internet and email to communicate to its members.
2.6.4 Services Offered by ADR ADR extends several services to its members including facilitation of registration, training,
sensitization on new sector developments, representation in different foras and advocating on
their behalf. However, interviews with the members indicated the need to refocus on the quality
of services provided. In terms of Trade and Market Development services, ADR could in the
future involve itself in Trade fairs/exhibitions, arranging for business delegations and
matchmaking services for its members. In terms of training services, ADR through the Training
Centre offered certification and standard setting course. ADR has received support in member
training from JICA and TMEA. This has seen various training conducted to members especially
on the Customs Management Act. However, there was evidence of gaps where more training for
members could be conducted including management training and other seminars and workshops
which would ensure that ADR members managed profitable ventures.
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As a BMO, ADR is expected to provide advice and consultancy to its membership. Consultancy
and advice services are intended to upgrade the know-how of individual members. ADR could
also provide specific consultancy services to its members including legal and financial advice.
The establishment of a vibrant help desk would help members when they have operational
issues. At the moment the members felt that this function was not very effective as a result of the
capacity of the secretariat. Gaps were identified especially in communication from the secretariat
to the members.
2.6.5 The ADR Training Centre The Training Centre was conceived to host the EACFFPC. The Centre has received support from
various stakeholders including RRA which provides resource persons and TMEA which has
committed to support the centre for 2 years from February 2012 by providing funding to equip
the centre and hiring of a Training Coordinator. Despite the role the centre plays, there have been
low registration levels by CFA. This has been as a result of various factors including the change
in working hours by CFAs that run up to 10:00hrs. The training centre will need to develop
appropriate business and marketing plans to ensure increased and sustained numbers of
participants. The centre should be treated as a strategic business unit and thus require to generate
its own revenues and create a surplus. Other than hiring of the training centre, other courses of
interest could be initiated targeting both members and non-members. The EACFFPC should
consider opening up to school leavers and others interested in the CF field and as such it could
provide an entry point to the sector. The long term should see the centre being accredited as a
training institution to offer other related courses possibly at the certificate, diploma and degree
level in partnership with other institutes of higher learning.
Some of the other challenges confronting ADR’s Training Centre include lack of a resource
centre that could be used by both the facilitators and participants. The facilitators also expressed
a lack of supportive training materials and refresher training based on the changes in the sector
environment. The need to have a review in the curriculum to incorporate learning tours was also
indicated by both the facilitators and present and past participants.
2.6.6 ADR’sKeyMilestonesandAchievements
ADR has helped instill discipline and initiated professionalism in most of its members in
the CF sector through various initiatives
ADR successfully launched its Code of Conduct and ensured its members signed the
same and lived by it
ADR successfully launched the training centre and has trained over 100 CFAs who have
graduated with the East Africa Customs Freight Forwarding Practicing Certificate
(EACFFPC)
Harmonization of Tariff for Transit Bonds in the various border crossing. This ensured a
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reduction of unethical business practices such as understating of Tariffs by some CFAs.
The process led to an agreement of how to distribute business among the CFAs ensuring
equity and reducing the uncompetitive behavior.
Advocacy towards the reduction of insurance premium which was previously at a high of
3% to 1.5%.
2.7 External Analysis of ADR
2.7.1 Political Environment Rwanda is in a stable political environment as a result of the wide-ranging reforms that have
been implemented to improve peace and security over the years since the genocide. Rwanda’s
political-governance reforms have been driven by the need to foster national reconciliation and
to empower local communities to participate in political and development processes, through
decentralization in particular. Institutions have been established and strengthened to foster
increased citizen participation in governance. However, the political stability of Rwanda is
affected by the cessation of political tensions in the Great Lakes region.
According to the World Economic Freedom, impressive regulatory reforms have been
implemented since 2008 eliminating bureaucratic hurdles to entrepreneurial activity and
increasing regulatory efficiency. Legislative actions have contributed to a more favorable
business environment, although the pace of reform has slowed in comparison to previous years.
On the other hand, corruption which is seen as significant, though lower than its EAC neighbors
threatens a full realization of the impacts of enacted reforms. The World Governance Indicators
show significant progress in areas such as government effectiveness, rule of law, regulatory
quality and anti-corruption. Transparency International ranked Rwanda 66th
out of 178 countries
surveyed in 2010 in terms of corruption, an improvement from 89th out of 180 countries
surveyed in 2009. Labor regulations are relatively flexible, but a more vibrant formal labor
market has yet to develop.
Internationally, Rwanda is a member of several regional bodies including the EAC and
COMESA. Rwanda is also a member of CommunautéEconomique des Pays de GrandsLacs
(CEPGL) composed of Burundi, Democratic Republic of Congo and Rwanda.
The Government has established various mechanisms to support and engage with the business
community through its various agencies including RRA, RBS, RUBA, etc. it has shown great
interest to improve the business environment. Its focus on business growth is exemplified in its
strategic documents including the Vision 2020 and the EPDRS. To foster a competitive
environment for business enterprises, the government developed a Competition and Consumer
Protection Policy in 2008 that was aimed at protecting both the consumer and businesses against
unfair and uncompetitive business practices.
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Implications for the Clearing and Forwarding sector:
Regional Integration presents an expanded market and geographical scope. It also opens
Rwanda for competition from other CFAs from the region. Kenya and Tanzania has
stronger and bigger CFAs that give stiff competition to ADR members.
The government initiatives in addressing Vision 2020 present an opportunity for CFAs to
determine the role they play in such developments. ADR and the CFAs should also work
closely with the regulatory agencies to achieve mutual benefits.
2.7.2 Economic Environment Rwanda’s economy has remained on a strong growth path with real gross domestic product
(GDP) growth increasing to 8.8% in 2011 from 7.6% in 2010. Growth was driven in 2011 by
good harvests, rising export receipts and expansion in credit to the private sector. Industry
reported the highest growth rate, 15.1%, owing to a rebound in mining and construction, which
grew by 15.5% and 22.3% respectively. Expansion in government spending and recovery in
tourism have also contributed to growth.
GDP growth is projected to go down to 7.6% in 2012 as programmed fiscal consolidation
reduces aggregate demand and also on account of global economic uncertainties. Inflation is still
single-digit but rising from 2.3% in 2010 to 5.6% in 2011. Average headline inflation is
projected to edge further upwards to 6.0% and 6.9% in 2012 and 2013 respectively, reflecting
growing fuel prices and the high energy share of imports, estimated at 18% in 2011.
Performance of the external sector was strong in 2011. Increased export earnings were driven by
stable and rising prices for major exports such as coffee, tea and minerals, which together
comprised 74.8% of export earnings in 2011. In 2011 versus 2010, exports of goods increased
by 52.8% from USD 253.7 million (US dollars) to USD 387.7 million. Imports increased by
17.3% to USD 1.63 billion in 2011 from USD 1.33 billion the previous year, deepening trade
deficit to 16.6% of GDP, up from 14% in 2010. Implementation of the National Export Strategy
will contribute to an increase in export and thus spur increased outbound trade.
Rwanda is faced by various infrastructure bottlenecks. The Strategic Investment Programme
(SIP) prioritizes six key investment projects which will spur economic growth including: energy
access rollout to households; building core information and communications technology (ICT)
infrastructure for high-speed broadband connectivity; construction and rehabilitation of a
regional railway linking Rwanda to Burundi and Tanzania; developing waterway projects in
respect of navigation on the Akagera River and Lake Kivu; constructing roads to link Rwanda
with Burundi (and the Democratic Republic of Congo,) including two one-stop-border post
facilities; capitalization of RwandAir and construction of Bugesera International Airport in order
to facilitate Kigali to become an aviation hub.
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Implications for the Clearing and Forwarding sector:
The economic growth represents opportunities in trade and therefore CFAs should be
positioned to grow with the economy
The growth in infrastructure portend well for the local and regional trade. The
infrastructure will spur export business and thus more for CFAs.
The developments in the Airports will also spur freight business for CFAs.
2.7.3 Economic Cooperation, Regional Integration & Trade
Rwanda adopted the EAC Common External Tariff under the Customs Union and has amended
key legislation to facilitate the right of establishment and movement of labour under the EAC
Common Market. As a result, Rwanda’s intra-Common Market trade has more than doubled
from USD 207.1 million to USD 503.7 million between 2007, when Rwanda joined the EAC,
and 2010. This increase has been largely driven by rising imports of consumer goods and
intermediate products. There are several initiatives in the EAC to support trade facilitation.
As a member of COMESA, Rwanda’s intra-COMESA trade has increased, with imports from
COMESA increasing from USD 162 million to USD 314 million between 2007 and 2010.
Exports to the COMESA peaked at USD 88 million in 2008, up from USD 23 million in 2007,
before decreasing to USD 58 and USD 36 million in 2009 and 2010 respectively, owing to a shift
in trade following Rwanda’s membership to the EAC.
Implications for the Clearing and Forwarding sector:
Regional integration provides a wider market for services for ADR members. Such would
ensure that ADR members can grow without being restrained by the size of Rwanda
Regional integration does bring with it increased competition. International and
established CFAs from other markets will compete with ADR for the Rwanda market.
2.7.4 Socio Cultural Environment The socio-cultural aspects of ADR’s operating environment are dictated by various variables
including cultural aspects, health, demographics, education and standards of living, among
others. In terms of health the Government of Rwanda developed the second Health Sector
Strategic Plan 2009–2012 (HSSP II) which is under implementation. The implementation has
seen a reduction in the infant mortality rate as well as maternal mortality.
In terms of education, key education indicators, including school completion rates and education
quality, have improved as well as the enrolment rate for secondary education. The 2010/11
household living conditions survey data indicate that the proportion of the population below the
poverty line has declined to 44.9% from 56.7% in 2005/06 but is still short of the 30% MDG
target.
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A new labourlaw was ratified in May 2009 and contains provisions to ensure the protection of
basic labour standards while enhancing flexibility in hiring and firing of workers. These
legislative enhancements have contributed to an improvement in Rwanda’s Global
Competitiveness Index ranking on labour-market efficiency from 9th out of 139 countries
surveyed in 2010 to 8th out of 140 countries in 2011.
Implications for the Clearing and Forwarding sector:
The improvements in standards of education imply an increased school completion rate.
This would mean more school leavers seeking certificate and diploma courses. In the
long-term ADR can target the school leavers as participants in the courses offered and
proposed by the Training Centre
2.7.5 Technological Environment Rwanda’s Vision 2020 aims to transform Rwanda into an information-rich, knowledge based
society by 2020 by leveraging ICTs in all sectors of the economy to be achieved through the
implementation of the National Information and Communication Infrastructure Plan (NICI). The
key objectives of NICI are to: transform Rwanda into an IT-literate nation; promote and
encourage the deployment and utilization of ICTs within the society; improve the civil and
public service efficiency; improve the information and communications infrastructure; make
Rwanda a regional ICT hub; transform the educational system and enhance skills development
leveraging ICTs thereby developing a human resource base that adapts to changing demands of
the economy; and develop the legal, institutional and regulatory framework and structures
required to support ICT development.
In 2010, Internet penetration in Rwanda was 5.3% compared to the African average of 10.9%.
From 2008 to 2010, Rwanda registered one of the highest Internet user growth rates with 8900%
compared to the continent growth rate of 2450% and the world average rate of 444%. In 2010,
more than 38.9% of Rwanda’s public sector (ministries, agencies, provinces and districts) had
web presence compared to 34.5% of the private sector (Rwanda Business ICT Survey).
Rwanda has constructed a National Data Center that is fully capable of maximizing the potential
in cloud computing, paving the way for increased services development. ICT initiatives fostering
Rwanda’s private sector development include several business and career development support
services that have been anchored to support various online business and trade information
portals. The ICT initiatives have seen the government under the e-government pillar facilitating
trade through initiatives such as the single window system thereby improving Rwanda’s business
environment
Rwanda does however face several challenges in implementing its ICT strategy. The challenges
include: inadequate international bandwidth partly as a result of Rwanda being landlocked is
very dependent on neighboring countries for connectivity, which greatly increases connectivity
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costs; inadequate ICT skills - lack of necessary technical and professional level of human
resources; energy - insufficient electricity which is a prerequisite to the ICT accessibility;
inadequate financial resources to fund ICT growth; high cost of communication in comparison
with neighboring countries; lack of awareness about ICT and its benefits of in both urban and
rural areas; a small and weak private sector, and; existing of high rate of illiteracy.
Implications for the Clearing and Forwarding sector:
Developments in technology provide opportunities and threats to CFAs. Threats more to
those that will be laggards in technological adoptions.
ADR can leverage ICTs among its members and this will greatly empower them in doing
business thereby increasing their competitiveness as they can easily achieve scope without
necessarily investing in brick and motor operations
The sector should position ICT as an enabler of increased productivity and cost reduction.
2.7.6 External factors affecting CFAs Competitiveness
Non-Tariff Barriers (NTBs)
NTBs have been found to be one of the factors that cause inefficiencies in trade among countries
in EAC and affect CFAs. NTBs are “structural bottlenecks” that include: inadequate government
structures; unfriendly business procedures and mismanagement; complex customs and
administrative documentation; erratic application of rules and regulations; import policy barriers,
labeling, certification requirements; anti-dumping and countervailing measures; non-transparent
government procurement practices; services barriers such as visa requirements; and bureaucratic
staff attitude coupled with low staff morale. All these represent additional costs to enterprises
and negatively impact the flow of goods and services within the EAC. The EAC Customs Union
instruments explicitly prohibit the use of quantitative restrictions on imports and all measures
having equivalent effects.
Most of the NTBs in the region call for policy initiatives focused on reducing the structural
bottlenecks and creatingan environment that facilitates the flow of trade within the partner states.
In order to address the NTBs, there is need to harmonize business regulations, licensing
procedures, business documentation, tax systems, standards and safety rules, including mutual
recognition of standards and safety requirements for adopting common regional standards. Also
infrastructure related non-tariff barriers, including upgrading road, railway networks, energy and
telecommunications, reduce border checkpoints, increase inland ports container handling
facilities for land locked EAC member states to reduce cost of doing business needs to be
addressed. There is also a need to establish an active NTB monitoring body that will act as
enforcing machinery for all policy initiatives aimed at facilitating intra-regional trade.
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Corruption
One of the factors affecting trade in the region is corruption. Studies in the region by various
organizations including Transparency International have found a strong link between delays and
corruption since delays provide an environment that facilitates corruption. In order to reduce
corruption there is need to reduce the level of bureaucracy by streamlining and simplifying
clearance procedures and making them transparent; establish a code of conduct for both customs
officers and clearing and forwarding agents (CFAs), which should include standards for customs
clearance in terms of duration as well as a provision of appeals of customs decisions; capacity
enhancement, including information technology (IT) solutions, which will reduce documentation
requirements and increase transparency, and workshops for CFAs, so that they can more
effectively handle clearance documentation procedures; and implementation of anti-corruption
campaigns targeting customs, CFAs, and other stakeholders in the chain.
Slow Implementation of the EAC Common Market Protocol by EAC Partner States
Member states of the EAC are mandated to implement various Articles in the EAC Common
MarketProtocolthat aid in doing business. However, the implementation of the Articles in the
protocol and regional integration as a whole is faced with various challenges as some countries
take long to implement the various agreements. Some of these challenges have an effect on
business performance. One of such a challenge is in trading in services. The obstacles to trade in
services are rarely tariffs; they are mostly non-tariff. The NTBs inherent in this perspective
include: restrictions on the rights of a foreign firm to establish or take over a subsidiary
company; restrictions on foreign firms from providing certain services; restriction on
ownerships; etc. Rwandese businesses are faced with restrictions of opening and operating
businesses in some countries thus restricting their ability to expand in scope. For example, if a
CFA from Rwanda wants to establish a business in Tanzania, they should cede 51% shares of the
business to a Tanzanian thus becoming a minority owner. This form of NTB is contrary to the
EAC Protocol clauses on Trade in Services. It could be ideal if a “single license” system with
mutual recognition would be implemented where service providers operating under the license of
one member state can work in another member state as long as the quality of regulators in the
different member states is recognized. A regional license, for example, would make it possible
for CFAs to avoid having to pay for multiples licenses.
2.8 StakeholderAnalysis Stakeholder analysis is a process of systematically gathering and analyzing qualitative
information to determine whose interests should be taken into account when developing and/or
implementing strategy. A stakeholder is an Actor (persons or organizations) who have a vested
interest in ADR. These stakeholders or “interested parties” can usually be grouped into the
following categories: international, public, national political, commercial/private,
nongovernmental organization (NGO)/civil society, labor, and users/ consumers.
ADRhasidentifiedseveralcategoriesofstakeholdersas discussedbelow.
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2.8.1 Members – Clearing and Forwarding Agencies
The CFAs are primary stakeholders of ADR. They expect that ADR can advocate on their behalf
on issues that affect them. They also expect to receive value added services including
networking, training, assistance with operational issues, and value for their membership
contributions. On the other hand ADR expect member support in its endeavors to professionalize
the industry by adhering to the ADR code of conduct, conduct their business in a professional
manner, make financial contributions, supportand enrollin the EACFFPC, and attendto ADR
supported functions. In order to get support from the members, ADR should ensure that member
communications are effective, sensitization meetings are held and members get value for their
money through services offered by ADR.
2.8.2 Rwanda Revenue Authority/ Customs Department
The Rwanda Revenue Authority (RRA) plays a big role in clearing and forwarding sector in
Rwanda. It is in charge of collecting all taxes paid in the country and regulates trade in
collaboration with other Institutions (public and private) involved in trade. RRA expects that the
CFA will provide correct documentation, declarations and submit appropriate duties of imported
goods. ADR expect that RRA will continue recognizing the association as the sole representative
of CFAs; will set and implement supportive policies to business; continue supporting the role of
ADR in enforcing sector discipline; support the removal of NTBs; and continue encouraging
industry self-regulation. In order to get support from RRA, ADR has to ensure that there is
discipline and professionalism in the industry; establish lines of constant communications;
adhere to set standards and policies, and; create a self-regulating mechanism.
2.8.3 Other Government Agencies
Other governmental agencies and ministries like MINICOM, MINEACand RBS play a critical
role in the success of ADR. As the Rwandese ministry in charge of regional integration,
MINEAC expects ADR members to be proactive and play their rightful role in supporting the
government in regional integration. MINEAC expects ADR to sensitize and prepare its members
for the EAC integration especially as the region moves towards SCT status. On the part of ADR,
it expects MINEAC facilitate trade by advocating on its behalf for removal of NTBs. ADR
expects MINEAC to articulate the concerns of ADR members to the EAC secretariat in as far as
the integration initiatives are concerned. ADR also expects MINEAC to work together with
MINICOM in assisting ADR membership competes in the region in view of the integration
changes.
MINICOM plays a crucial role in the success of ADR. It has also its expectation on ADR which
include the need of ADR members to adhere and operate within the laws and
professionally.MINICOM through its agencies like RBS expects CFAs to adhere to set standards
and be professional in their dealings. It expects ADR to support economic growth by ensuring
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that CFAs are growing and sustainable. ADR expects MINICOM to support it in facilitating
trade and removal of NTBs.
2.8.4 Development Partners and Donors
Development partners and donors have an interest in the success of ADR. Through ADR, such
partners can achieve their trade facilitation objectives. The development partners and donors play
part in the improvement of business environment. They expect ADR to become a strong,
sustainable, competitive, effective, efficient and excellent apex body which leads in reduction of
cost of doing business in the region. For ADR they expect to get technical assistance, capacity
building, and exposure to best practices and financial support from the partners and donors. To
achieve this, ADR should maintain good partnership and collaboration with their respective
partners and donors supporting the sector. ADR should also ensure that any technical and or
financial support provided by the partners is utilized and accounted for through having
appropriate corporate governance, financial systems and capacitated employees.
2.8.5 Shippers – Cargo Owners
As stakeholders of ADR, shippers (cargo owners) expect ADR members to provide quality
services in an efficient and cost effective manner. As the owners of the cargo they expect to
receive their cargo safely and without any alterations in quality and quantity. They do also expect
quality advice from the CFAs. On the other hand, ADR expects that the shippers pay their
members competitive rates, provide appropriate documentation and in a timely fashion, import or
export goods that meet the standards of the corresponding authorities, carry out legitimate trade
and uphold business ethics. In order to ensure that this happens, ADR should engage and create
awareness/sensitization of the shippers to various changes, requirements, procedures, processes
and standards.
2.8.6 Secretariat Employees
The employees of ADR are critical stakeholders in the success of ADR as they enable delivery of
services to other stakeholders. The employees expect to be provided with conducive working
conditions, competitive remuneration, capacity building opportunities and career development.
In return, ADR expects the employees to work hard, diligently and be focused to deliver the
goals of the association. However, for this to happen, ADR should provide the employed with
motivation, strategic leadership, rewards and recognition, empowerment and job security.
2.9 SWOTAnalysis
In developing this strategic plan, an assessment of ADR’s strengths and weaknesses as well as
opportunities and threats was carried out. This analysis provided a platform to determine
appropriate strategies and activities so as to ensure that ADR’s planned objectives are achieved.
SWOT analysis is based on the assumption that an effective strategy derives from a sound fit
between the association’s internal resources (strengths and weaknesses) and its external situation
(opportunities and threats). For strategy to be successful it should take advantage of existing or
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projected opportunities and minimize the impact of major threats. Also the strategy should place
realistic requirements on the available and projected resources.
AnanalysisofADR’sstrengths,weaknesses,opportunitiesandthreatsarepresentedbelow.
Strengths Implication for ADR
Committed and supportive Executive
Committee:
The EC members are committed to the success of ADR. As
experienced members in the industry, the EC have immense
knowledge that if tapped would drive ADR to new levels of
growth.
Existing Code of Conduct and
Statute: ADR has a code of conduct and Statute that guides its
operations and thus help in professionalizing the industry
Existing of training centre on freight
and forwarding:
The ADR training centre puts ADR in a strong position to
influence the professionalization of the industry. It could
also be used to generate further incomes to the Association
Only recognized representative of
CFAs in Rwanda: As the only representative of CFAs, ADR can use this to
advocatefor supportive business environments for its
members and ensuring that all members operate in a
professional manner.
Member of various national bodies: Through its membership in regional and international
bodies ADR can influence policy development.
Good partnership/relationship with
the public sector
ADR has good working relationship with various public
sector agencies and government regulatory bodies. This
relationship and goodwill could be used for the interest of
its membership
Good working relations with
external partners/stakeholders: Over the years ADR has developed relationships with
stakeholders and donors like JICA and TMEA. This
relationship can be improved to fund some of the initiatives
in this Strategic Plan.
Weaknesses Implication for ADR
Low capacity of ADR’s members as
most are SMEs
ADR should be able to encourage the merging and
partnering among its members in order to take advantage of
the opportunities presented by regional integration.
Weak financial Base:
ADR relies on 2 main sources of funds – Transit Bonds
commission and Membership fees. With regional
integration, the transit bonds are at risk especially with the
SCT. ADR should act to diversify its sources of funding and
ensure sustainability
Lack of sectoral expertise in the
Secretariat:
ADR’s Secretariat lacks expertise in most areas that are
critical to an Association. This leads to over reliance on the
association Chair. Since it requires funds to have sector
experts, ADR should use the good relationship with donors
and development partners to help staff the secretariat with
the key expertise.
Association does not have own
offices: Pays high rents for the
Due to the high wage bill, in the longer term ADR should
plan for its own premises. ADR can use its good
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offices and Training Centre relationship with the GoR to be allocated a piece of land for
future development.
Weak advocacy capacity: As mentioned above ADR should be able to recruit and or
capacitate the secretariat to be able to advocate effectively.
ADR’s legal status is weak ADR is established under the Labour Code as an association
of CFAs. ADR should take advantage of the good
relationship with Government to be a recognized
professional border created by an Act of Parliament.
Non existing MoU between ADR
and Rwanda Revenue Authority
ADR’s relationship with the revenue authority to act on its
behalf in registering CFAs is not enshrined in any laws.
Member dissatisfaction especially on
communication and feedback:
ADR have a dedicated staff on member issues and should
establish a helpdesk/hotline for its members and utilize
technology to communicate with members.
Lack of ownership by ADR’s
members:
ADR should create more avenues of interacting with
member’s as well as creating value adding services to their
members including constant brief and updates
Low levels of staff motivation: Due to several factors, majorly financial ADR is unable to
attract and motivate its staff. Again with a strategic
orientation and use of relationships created, ADR can attract
more funds to hire and competitively compensate its staff.
Opportunities Implication for ADR
Willingness by theGoR to listen to
issues raised by ADR:
ADR should piggyback on its goodwill with the government
to propagate its agenda and that of its members
Regional integration: The EAC integration provides ADR members with
increased market scope and partnership opportunities. The
integration will also lead to market growth and removal of
most NTBs
Greater demand for professionalism,
integrity, compliance, self-regulation
As a business concern, ADR should take advantage of the
demands and institutionalize professionalism in members
Supportive development partners in
trade facilitation and
competitiveness;
ADR should take advantage of the support and
opportunities from partners to build its own capacity and
that of its members.
Developments in IT and business
solutions
This provides an opportunity for ADR members to operate
efficiently and prospect on a large scale disregarding
borders
Government support of imports and
Exports sector
The GoR has initiated several projects to spur export and
import trade. ADR should position its members to take
advantage of opportunities created.
Infrastructure development eg
Roads, Airports, rails and waterways
ADR members should position themselves to take
advantage of opportunities in export and airfreight as a
result of infrastructure developments.
Threats Implication for ADR
Unpredictable and changing
regulatory environment
ADR should reduce environmental threats by preparing its
membership through sensitization workshop
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Regional and global competition: As a threat, competition can be mitigated by supporting
members through capacity building, advocatingfor fair play,
organizing for business linkage forums, etc
Global business crises Due to the erratic nature of global businesses any changes
have effects on CFAs. ADR should encourage members to
diversify their product offerings that may cushion them in
terms of crises. The members should be encouraged to
invest more on technology and reduce operational costs.
Introduction of alternatives to
National Transit Bonds:
As about 50% of the CFA revenues are derived from transit
fees, any abolition of national bonds will affect their
businesses. ADR should sensitize their members on the
same and encourage them to introduce new sources of
income other than transit fees.
Globalization / regionalization of
trade:
Regional integration through SCT threatens the survival of
most ADR members. Other than supporting members to be
competitive, ADR should facilitate their members to form
partnerships with other local and international CFAs in
order to increase their scope and ability to operate at points
of entry
High cost of services eg insurance: ADR should use its relationship with various stakeholders,
networks and representation in various bodies to
advocatefor fee reduction
Non-tariff barriers (NTBs); This will require developing capacity in monitoring NTBs
and advocating for their removal as they lead to high costs
of doing business.
Proposed Automated System for
Secure Transit (ASSET)1
When operationalized ASSET will lender some border
operations irrelevant and by extension some CFAs as they
derive a substantial amount of their revenues from border
operations. The introduction of ASSET will require ADR to
re-orient itself and its members to newer sources of funding.
Partners and ADR will have to prepare members for any
eventuality through an engagement and sensitization
strategy. ADR needs to engage with partners for solutions to
the impact of such a facility. Member sensitization
workshops will need to be conducted well in advance in
order to manage change and reduce any dysfunctional
effects of such a change. ADR could also conduct research
and develop a position paper on ASSET.
1 See a brief description of ASSET in Appendix III
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CHAPTER THREE
3.0 THE CLEARING AND FORWARDING SECTOR
3.1 Developments in the Clearing and Forwarding Sector
The trade facilitation agenda has changed, and the scope of trade facilitation reforms is
broadening, covering the entire supply chain, rather than being limited to the point of crossing an
international border. Efforts in the implementation of trade facilitation reforms have gained
momentum and the trend is to look beyond the customs environment to the operational strategies
and capacities of all supply chain operators. The role of the private sector, both as a driver and an
enabler of the process, has become more critical. With more of the burden of regulatory
compliance being placed on the shoulders of traders and logistics services providers, they now
more than before have a stronger interest in facilitating trade.
3.2 Development of Advanced Logistics Service Providers Major changes have been witnessed in the last couple of years in the clearing and forwarding
sector. The changes have been driven by rising demands and expectations from customers, the
need to reduce the cost of doing business, regionalization and globalization, developments in the
supply chain management, mergers and acquisitions in the sector, integration of technology in
logistics and even development in global production efficiencies. Due to the changes in the
operating environment and in order for the freight forwarders to survive they should embrace the
developments and compete on a global platform in order to meet customer demands. The
traditional role of just clearing and forwarding goods is being replaced by the need to provide a
one stop shop with fully integrated 3rd
or 4thParty Logistics (3PL or 4PL
2) services.
Trends in the industry have seen major logistics providers, shipping lines and forwarders
merging. As a result, fewer and fewer customers need a pure forwarder whose capacity is limited
to clearing and forwarding tasks. While the freight forwarder is evolving into an FLP who
provides value-added services, banks, shipping lines, trucking companies, terminal operators,
and consultants are adding logistics services and freight forwarding to their lists of services
provided. The traditional forwarder will not be able to compete with these flexible FLPs unless
they actively integrate itself into a supply chain.
Some of the developments in the sector are captured in the figure below.
2A third-party logistics provider (3PL) is an asset based company that offers logistics and supply chain management
services to its customers. It commonly owns and manages distribution centers and transport modes. A fourth-party
logistics provider (4PL) integrates the resources of producers, retailers and third-party logistics providers in view to
build a system-wide improvement in supply chain management. They are non-asset based meaning that they mainly
provide organizational expertise.
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Transformations in the Freight Industry
Due to the supply chain transformations, the demands and advances in the market require a
service provider who will assure of deliveries from point of loading to the customers warehouse.
Such a service provider should be able to provide services that are:
• Seamless: barriers of are minimized
• Reliable: deliveries are punctual and commodities are undamaged
• Available: door to door services are provided 24X7
• Accessible: customers deal with one stop shops / single entry points
• Secure: commodities get into the hands of those entitled to receive them, and no
intrusions are possible;
• Affordable: offer competitive prices to customers
3.3 The Freight and Forwarding Industry in Rwanda The clearing and forwarding sector in Rwanda is composed of a few large multinational
companies offering 3PL services to small and medium local clearing and forwarding agencies.
As of January 2012, there were about 122 registered CFAs in Rwanda employing about 900
employees. Out of the 122 members, only 9 would be regarded as international companies with
operations in several countries. The large multinational organizations have their presence in
Rwanda through opening up of subsidiary offices or franchises. While multinationals have
operations in different countries, most of the local CFAs only operate in Rwanda. The
multinationals due to their size and networks handle large and internationally connected clients
and there have scale advantages. This is possible as they take advantage of their global linkages
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and ability to mobilize funds to support their large scale operations; the ability to hire quality
human resources, and; employ technology in facilitating their businesses.
As organizations strive to be competitive and as a result of supply chain transformations, some of
the service and manufacturing firms have initiated their in-house clearing and forwarding
agencies. This as a result has led to a new frontier of competition. In some cases, in order to
utilize their clearing capacity, some of these organizations have marketed their in-house
functions to other organizations.
There are several challenges facing the local CFAs which have to be addressed in case they have
to benefit from increased regional and international trade. The challenges include:
Finances and ability to mobilize the same;
Small in size restricting the amount and nature of business they can handle;
Low levels of professionalism;
Limited application of technology;
Limited scope of operations (few services provided in the value chain mostly clearing
and forwarding);
Limited knowledge of the global sector;
Low margins due to undercutting of prices; among others
Some of the suggestions that have been proposed to strengthen the sector include:
Growing scope by merging and or entering into franchise agreements/partnerships with
international CFAs who can provide scale and scope required to be competitive;
Building their capacity through training;
Offering their services to other clients in the region by either opening agencies in other
countries or using technology to increase scope;
Adhering to professional codes of conduct.
3.4 Rwanda’s Logistical Challenges Rwanda faces several challenges as a result of its landlocked location, small domestic market,
low production with concomitant import dependence, and the cost and quality of logistics
services. These challenges affect the ability of the CFAs to expand and grow. However various
initiatives have been suggested and put in place to address the challenges. According to the
Logistics and Distribution Services Strategy for Rwanda, the challenges which affect Rwanda’s
competitiveness:
Limited Capacity to Attract Imports: Rwanda has a small domestic market by virtue of
a small population with low spending power. The country as such is considered a small
attractor of international freight traffic.
Limited Capacity to Generate Exports: Rwanda’s capacity to produce goods is low,
and most of the capacity is in agriculture. The bulk of what is produced is distributed
locally for consumption and the remainder is exported abroad.
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Limited Demand of Logistics Services: Rwanda’s limited capacity to generate trade
leads to low capacity to stimulate demand for logistics services. Value addition to
primary production is limited within Rwanda as most agricultural produce is exported for
value addition in other countries leading to a short value chain. This affects the demand
and opportunities for value added logistics services.
Import Dependency – Trade and Transport Imbalance: The Rwandese supply chain
is loaded with incoming goods while the backhaul return movement is empty most of the
time. This implies that the import traffic bears the bulk of the cost burden of the round
trip because of the empty backhaul return movements.
Landlocked Constraints: Being landlocked, moving goods into and out of Rwanda is
full of challenges as it has to depend on other countries where for transshipment to ports.
Over 99% of imports and exports use sea-land routes while there is minimal use of air.
In view of the above challenges, CFAs cannot rely only on the Rwandan market for their growth
because of its limited size and should consider broadening the market area by going outside the
country. This means they should export their services to neighboring countries.
3.5 Rwanda’s Import and Export As mentioned before, Rwanda is an import dependent nation. The trade imbalance in import
flows exceed export flows and poses a logistics problem since the supply chain is loaded with
incoming goods while the backhaul return movement is empty most of the time. According to
Rwanda Customs data, the recent years have seen an increase in both imports and exports.
However, imports have recorded a higher growth than exports. This trend is expected to grow
especially with the many development and investment projects being implemented and those
planned for implementation in the next 5 years.
In order to address the imbalance, a series of initiatives spearheaded by government of Rwanda
through the Ministry of Agriculture and Animal Resources (MINAGRI), the Ministry of Trade
and Industry (MINICOM) and Rwanda Development Board (RDB) have been proposed and
some initiated. When fully implemented, the initiatives will increase the exports of goods from
Rwanda to the neighboring countries and beyond. In light of these developments, a positive
environment is emerging to stimulate value added activities in the product and service sectors
including exporting Rwandan logistics services to neighboring countries. With the increase and
the creation of the proposed Regional Logistics Hub, there will be more opportunities for the
CFAs as the increase in export trade will require their services. Such increased business may
have also an implication on the demand for training services which the ADR training centre
could address.
As indicated in the table below, revenues from the import sector are expected to grow from a low
of 1,564 million dollars in 2011 to about 1,841 million dollars in 2014. This is a clear indication
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that the growth in import revenues as projected will provide a market demand for corresponding
services to support the increased business. Such is the scenario the CFAs should be prepared and
plan for. CFAs will require growing their businesses at the same level or even higher compared
to the economic growth of Rwanda. Export business is also projected to grow from about 464
million dollars in 2011 to 527 million dollars in 2015. Such a growth as a result of GoR
implementation of the various initiatives to support export potential in agriculture and mining
will also require clearing and forwarding services. ADR members will have an opportunity to
share in the growth of exports by providing the required services.
Rwanda’s Imports and Exports (Millions of U.S. Dollars)
Year Imports Exports Total
2009 999 235 1,234
2010 1,084 297 1,381
2011 1,564 464 2,028
2012* 1,778 467 2,245
2013* 1772 493 2,265
2014* 1,841 518 2,359
2015* 1,626 527 2,153
* Projected Figures
Source:IMF Country Report No. 12/152 for Rwanda. June 2012
3.6 The State of Air Cargo Services Market Air accounts for about 0.4% of all imports while Land/sea accounts for 99.6% in terms of
exports, 99.7 percent use land/sea modes with only 0.3% of exports using air. In terms of
tonnage, imports by air accounted for 5,905 tons in 2010 while exports accounted for 292 tons
for the same year. This is despite the fact that the air supply chain offers a rather different
standard of service that is fast and secure but also a lot more expensive.
Compared to neighboring airports, notably Entebbe in Uganda, the cost of air-freighting products
out of Kigali is more expensive than airlifting from Entebbe airport. Through various initiatives
by MINAGRI, MINICOM and RDB, horticultural exports are expected to spur the usage of
Kigali International Airport. Air is the only international supply chain that potentially offers the
speed and security of service that a landlocked country would appreciate, albeit at a cost higher
to the sea-land routes. When fully implemented the initiatives are expected to accommodate an
aggregate air import traffic volume that increases from a base of 5905 tons in 2010 to a range of
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22,500 to 42,300 tons in 2020 while the export flow is expected to rise from a base of 381 tons in
2010 to a range of 7,800 to 15,400 tons in 2020. It would thus be imperative for ADR members
to position themselves to take advantage of the Air Cargo market.
3.7 Proposed Strategic Developments
There are several proposals identified for Rwanda in line to ensuring it addresses the logistical
challenges identified above. Two of these are pertinent and affect CFAs. These are:
Off-Dock Container Depots: This concept of the Rwandan owned off-dock facility at
Mombasa and Dar es Salaam is based on its function as a buffer for Rwandan cargo flows
between the port and Rwanda. Such a facility would enable CFAs to add on the list of
services they perform by offering their customers storage, packaging, cargo consolidation,
etc. It would also facilitate the location of the CFAs at the ports where they would clear
Rwanda destined goods and offer their services to others thus competing at a regional base.
E-Freight Exchange: This intervention is directed at the participants in land bridge
operations, particularly the providers of transit transport services, through the introduction of
an e-marketplace that connects Kigali to the Rwandan Container Depots at the gateways.
Logistics service providers would register as sellers or buyers to communicate commercial
information and transact business over the internet in an open market regime. In practical
terms, this would enable transit transport operators to find backhaul loads more readily,
better proficiency in matching number of containers on trailers to regulatory limits on vehicle
weights and dimensions, and other considerations, whereas buyers of such services (trader or
forwarder) would be able to exercise their decisions more rationally through an informed
way based on competitive prices, service quality and safety (as reflected by transporters’
performance history), etc. From a market efficiency standpoint, this intervention would level
the uneven playing field and lead to a more competitive market as opposed to the current one
that is imperfect as a result of information asymmetry.
3.8 New Generation Trade Facilitation Instruments In order to address the needs and demands of the supply chain, various players in the sector have
focused on initiatives at enhancing trade facilitation. Some of the trade facilitation initiatives
include customs automation, one stop border posts, single window systems and ICT based
freight logistics solutions. These initiatives are addressed below.
Customs Automation
International trade is based on the efficient and timely circulation and processing of information
and documents. This can be facilitated by integrating ICT in custom processes as ICT is at the
heart of customs automation and modernization. Automation enables remote access through
fixed and mobile equipment. Customs Automation if put to effective use can lead to shortened
clearance times. Over 70% of all customs clearances have been automated with the Automated
System for Customs Data++ (ASYCUDA++). An electronic customs single-window system,
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One Stop Border Posts at Gatuna (border with Uganda) and Nemba (border with Burundi), and
electronic cargo tracking have been introduced to complement the 24-hours-a-day / seven-day a-
week borders policy. These innovations have facilitated an expeditious clearance of goods and
the flow of passengers, thus improving cost efficiency.
One Stop Border Posts (OSBP)
OSBP is the organization and supervision of joint border agency operations to contain the
common challenge of facilitating the crossing of people and goods while maintaining normal
security and upholding national legal requirements at these borders. The success of OSBP lies in
international integration between agencies of neighboring countries by co-operating with one
another to align border-crossing facilities and procedures. The OSBP require cooperation,
parallel processing, and co-ordination at border points of entry for an optimal collective
efficiency of these border institutions.
National Single Window Systems (SWS)
The implementation of SWS for international trade is considered to be an efficient means to
facilitate trade procedures. The SWS allows parties involved in trade and transport to lodge
standardized information and documents with a single entry point to fulfill all import, export and
transit-related regulatory requirements. In practical terms, the single window aims to expedite
and simplify information flows between trade and government and brings meaningful gains to all
parties involved in cross-border trade. SWS facilitates trade by reducing delays and lowering
cost associated with clearance of goods at the borders, while maintaining the requisite controls
and collection of duties and taxes, where applicable, on goods imported or exported.
Single Customs Territory (SCT)
As a consolidation of the EAC integration process, the EAC Secretariat is planning to establish a
Single Customs Territory (SCT). Though the Heads of States have accented to the SCT, its
implementation is expected after various consultative meetings, studies and development of a
framework to guide the process are done. Under the SCT the EAC member states will adopt a
destination model of clearance of goods where assessment and collection of duties/revenue is to
be done at the first point of entry. However, Customs administrations at destination states retain
control over assessment of taxes. The establishment of the SCT would enable all foreign goods,
once the import duties are paid at their entrance to the EAC, to freely circulate between the
member countries in the same way as the goods produced in the region. This will considerably
simplify the trade logistic and lower the cost of trade, but also force the companies from the
region to increase competitiveness and adapt to higher production standards.
The SCT is seen as a way to help curb tax evasion by unscrupulous importers who misrepresent
imports as transit goods only to off-load them mid-journey; ensuring minimal internal border
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controls leading to a more efficient institutional mechanism in clearing goods. On the other hand
due to its nature, it will open markets within the region to competition.
Members of ADR like other businesses in Rwanda have raised concern as to the implication of
the implementation of the SCT. In application, the STC will minimize border and inland
clearance activities and thus will have a direct effect to CFAs operating within the borders of
Rwanda. On the other hand, since clearance will be at the port of entry, in this case either
Mombasa or Dar-es-salaam, much of the clearing and forwarding will be port based. This may
require that for the CFAs in Rwanda to compete and serve their customers, they should open
offices in the ports of entry. A number of challenges face the CFAs in this front including the
financial implications of such a move, the legal framework in existence that restrict foreign
business operations especially in Tanzania, the reduced business activity in Rwanda as most
clearing and forwarding will be done at ports of entry. ADR should play an active role in the
STC process by advocating on behalf of the interest of its members. To do that, it may require to
be represented in the High Level Task Force on STC.
Integrated ICT based Logistics Solutions – e-freight
Due to the global developments, and in order to achieve efficiencies in trade, the use of
technology has become so central in the clearing and forwarding sector. New developments have
seen the introduction of electronic logistics systems and marketplaces. These are electronic hubs
using web-based systems that link service providers and clients together for the purpose of
collaboration and/or trading. Such initiatives are driven by economic and environmental benefits
of both parties. Inefficiencies in supply chains motivate the private sector to seek ways for
improving logistics operations. The e-logistics or e-freight frameworks are being developed to
facilitate trade by information provision and linking buyers and sellers of services regardless of
geographical location. An online marketplace like e-freight exchange can help to alleviate
corridor transport inefficiencies resulting from market asymmetry in the clearing and forwarding
sector.
Due to the above developments, the traditional clearing and forwarding firms will be faced with
competition from those using online marketplaces; CFAs will have to combine their expertise
with advanced technology to evolve; strategic alliance and merger/acquisition will be important
to obtain comprehensive and integrated supply chain solution capability, and; small carriers and
niche carriers will benefit from increased access to shippers and reduced search costs. Such an
agent should evolve through technological applications.
3.9 Challenges in the Clearing and Forwarding Sector The clearing and forwarding sector has faced a number of challenges in the recent years. The
signing of the EAC Common Market Protocol has driven pressure for the sector to offer more
efficient and reliable services. Such services require players in the sector to have a different
approach to business due to the competitive nature driven by the protocol. More challenges are
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emanating from the various technological advancement as well as changes in business scope of
players in the industry.
The sector is also faced by high costs of doing business due to various factors that contribute to
trade facilitation costs. The reduction cost can be brought about by improving the national
logistics infrastructure to facilitate smooth transfer of materials and information. Simultaneously,
at the micro level, the logistics service providers need to infuse better management practices,
employ technology that facilitates its logistics process to reduce its service cost.
As a summary, some of the key challenges facing ADR and its membership include:
Inefficiencies along trade and transit corridorswhich are as a result of: poor condition of
infrastructure (ports, roads, railways, and border posts); poor transit facilitation; limited use
and availability of appropriate technology;
Limited political will to transcend national interests in favor of regional solutions.
Delays in the movement of goods
Challenges in implementation of national and regional laws and regulations
Documentation requirements by customs in the central and northern corridors
Competition of established logistic firms in Kenya and Tanzania
Security of goods and personnel in the corridors
Overall high costs of doing business
Institutional sustainability
3.10 Potential Market in the EAC as a result of the SCT As a result of the developments in the EAC region, and especially the implementation of the
SCT, more competition and opportunities will be available for the CFAs. The EAC market is
currentlyestimated to be more than USD 83 billion. This is expected to grow to over USD 100
billion in the next 3-5 years.The table below indicates the size of the market in each country and
the projected growth in the next 5 years. This is an indication of the potential of the market in the
region. The Rwandese market is about 8% of the total EAC marketand thus it can be inferred that
with the STC, Rwanda CFAs will have increased market opportunities focusing on the other
EAC member countries. It is this challenge that ADR should give to its members and apart from
sensitizing them, assist them to be ready to take advantage of the massive market potential.
Potential EAC Market
Country 2011 Growth
Rate*
GDP (USD Billion)
2011* 2012** 2013** 2014** 2015**
Rwanda 7.4 6.4 6.9 7.4 7.9 8.5
Burundi 4.1 2.3 2.4 2.5 2.6 2.7
Uganda 6.6 16.8 17.9 19.1 20.4 21.7
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Kenya 4.5 33.6 35.1 36.7 38.3 40.1
Tanzania 6.3 23.7 25.2 26.8 28.5 30.3
Total
82.8 87.6 92.6 98.0 103.7 *Source:World Bank Country Data 2011
**Projections using 2011 growth rate as a base for all the years.
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CHAPTERFOUR
4.0 STRATEGICFOCUS, OBJECTIVES AND STRATEGIES The purpose of this Strategic Plan document is to provide ADR with a road map for the
next five years. The plan gives guidance to ADR to realize its vision by focusing on
objectives, how these objectives will be achieved. The plan was developed
through extensive consultations with varied stakeholders.
4.1 ADR’sDistinctiveness / Value Proposition The figure below captures the distinctiveness of ADR. Its distinctiveness is based on its unique
position as the only association representing CFAs, its services, networks and desire for industry
growth.
ADR’s Distinctiveness
4.2 ADR’sKey Strategic Areas
From the analysis of interviews and discussions with various ADR stakeholders, 4 strategic
Themes were identified central to the success of ADR. The areas include: Member Services (to
focus on membership issues); Advocacy (to focus on ensuring supportive policy and regulatory
environment is created to enable business performance); Professionalism (to focus on aspects of
professionalizing the industry), and; Institutional Strengthening and Sustainability (focus on
building the Secretariat into a formidable and sustainable institution).
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4.3 ADR Desired State in 5 years
The state of ADR in the next 5 years can be viewed in two approaches which are linked to the
pillars and the strategic direction below:
Institutional State
For the institution focus, within the next 5 years, ADR should be a highly Professional
Association with the ability to set the agenda in the clearing and forwarding sector locally and in
the region. The Association will have achieved organizational, financial and service
sustainability.
Industry/Membership State
In terms of its membership and industry, the Association will have created a professional,
competitive and attractive sector through initiatives at transforming the members from just
clearing and forwarding agencies to professional integrated logistics service providers. This will
require members to excel in service delivery in order to have a competitive advantage over other
CFAs in the region.
4.4 ADR’s Strategic Orientation
The strategic orientation for ADR will be based on a Results Based Management framework. The
framework conceptualizes that for ADR to achieve its goals, it should create or contribute
impact. However, for that to happen objectives will be derived and each of those objectives will
be expected to deliver an outcome. On the other hand particular activities and inputs should be in
place. The sections below will address the values components of the results chain as shown in the
figure below.
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4.5 StrategicGoal The goal of ADR for the next 5 years is to enhance its members towards achievement of
professionalism and competitiveness in the clearing and forwarding industry.
4.6 StrategicPriorities After carrying out the SWOT analysis, PEST analysis and stakeholder analysis, four key
Strategic Priorities which will guide ADR over the Strategic Plan period were identified as
follows:
1) To promote growth and prosperity of its members;
2) Increased interventions for advocacy of its members;
3) To promote professionalism of its members;
4) Institutional capacity building.
In addition, within each of the fourkey strategic focus areas, a set of strategic objectives and
activities which will be pursued both in the short and medium-term has been identified. The
sections below will review each of the strategic priorities, identify challenges therein and
develop strategies appropriate to achieve the strategic priorities.
4.6.1 To promote growth and prosperity of its members
The main role of ADR is to represent its members. However, in order to effectively undertake
its mandate, ADR has to promote the growth and prosperity of its members. In doing so, ADR
acts both as service facilitator or provider and as a representative body. ThestrengthofADRliesin
the strength andvibrancy of its members. ADRhas a crucial role to play inthe growthand
development of CF businesses. Thiscan be under t akenthroughvarious initiatives by ADR.
Thispromotesthe CFAsto playaneffectiverolein their growth and development. ADR requires
taking cognizant of the fact that most of its members are small and medium enterprises and thus
are faced by major operational challenges.
ADR needs to provide a range of services that will not only benefit the members but also be
sufficiently attractive such that members will demand for the same. Towards this end, ADR will
need to design a range of member services that will be provided at no cost and design other
services that will incur extra charges. For those services that cost extra, ADR could provide them
to non-members at a higher cost. Some examples of potential services are: training – managerial,
technical, training on standards and legal issues; advice and consultancy – best practice
benchmarking, digests of new regulations and implementation of the same; information and
networking – membership directory and database, conferences and high level meetings,
newsletters and publications, industry clubs and meetings, etc. Due to the nature and size of its
membership ADRshouldestablish micro-enterprise development programmes, to support the
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emergence and development of SMEs CFAs and encourage positive and best business practices.
Such programmes would support the SMEs in acquiring funds at a low cost and even organizing
the sector for a competitive Group Liability Insurance.
Strategies
This objective will be accomplished by pursuing the following strategies:
Establish a member help desk and hotline
Facilitate the strengthening of CFAs throughtraining members in logistics,
governance, general management, journey management and related issues of interest
Creating networking, benchmarking tours and business linkages forums for members
with importers, exporters and service providers
Provide members with specific consultancy services for example taxation, legal advice, dispute resolution, etc
Sensitize and prepare members for regional integration
Create member awareness, understanding and implementation of developments in trade
facilitation for example SCT,ASSET, Freight Logistics Portal, e-portal
Facilitate members to acquire group liability insurance and special funding services.
Expected Outcomes
It is expected that by the end of 5 years the following results will have been achieved:
90% of the members will have received relevant managerial and technical training
Two new member value adding services/products are introduced every year
An annual member satisfaction index of 90% is attained
90% of member operational issues are resolved within 48 hours
4.6.2 Increased interventions for advocacy of its members
ADR represent an important segment of the economy of Rwanda – one that stimulates economic
growth through the process of facilitating delivery of imports and exports and creation of the
jobs that accompany them. Yet, to achieve this, CFAsshould operate in a sound legal and
regulatory environment. Individual CFAs lack the power to influence government policies or
public opinion.Therefore, the voice of ADR’s members needs to be heard in the policy making
process through targeting the implementation of reforms in selected areas that are seen as being
problematic for the conduct of business. These reforms can include the creation of new
legislation, the amendment of existing laws and regulations to improve the business
environment, the elimination of administrative barriers to doing business, elimination of red tape,
the creation of institutions, the introduction of business standards aimed at improving the
competitiveness of the CF sector, etc. ADR should be able to design a coherent advocacy
strategy. Current advocacy efforts are focused on pressing issues and “firefighting”. Such short-
term thinking often leads to highly personalized ad-hoc decisions on advocacy measures that
limit the secretariat’s ability to address issues central to long-term competitiveness.
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By actively engaging in advocacy, ADR will raise its profile among policymakers and enhance
its reputation within the business community. This will help it expand its sphere of influence in
the private sector and within GoR and its agencies. ADR needs to position itself so that it is
involved in every step of the legislative process of policies that affect CFAs. Since advocacy is
also about communicating and influencing opinion regarding business, ADR should participate
in the decision-making process using tools such as dialogue platforms which include forums,
conferences, tradeshows, breakfast meetings, etc; direct advocacy; grassroots campaigns; public
relations and use of the media.
ADR, as an apex organization, has to develop several mechanisms for public-private dialogue
through engagement at the highest levels of government – in order to advocate on cross cutting
issues affecting its membership and the industry. Though a member of PSF, ADR must also
engage in direct advocacy especially on issues that are specific to its members.Where there is
need to amplify its voice ADR can join forces with other sector representatives by engaging the
relevant authority within the sector concerned.
Strategies
The strategies for achieving the above objective are:
To enhance the capacity of ADR to speak on behalf of the CFAbusiness community
Advocate for the reduction of various feesby service providers eg Insurance Providers
and Banks
Develop and produce policy and position papers on areas of common interest to the
sector.
Advocate for the removal of Non-Tariff Barriers and other administrative bottlenecks that
inhibit efficient business conduct
Advocate for members interests especially in the regional integration process
Advocate for the recognition of CFA license in all the EAC member states
Expected Outcomes
It is expected that by the end of 5 years the following results will have been achieved:
A reduction in service fees/charges by service providers
A reduction of NTBs identified in any particular year
75% of members will operate in strategic alliances with peers in the region or
individually in the EAC member states
4.6.3 To promote professionalism of its members
The C&F industry in Rwanda just like in other regional markets faces a lot of challenges in terms
of professionalism. This is as a result of the way fact that there are no barriers to entry and exit in
the industry. The financial undertaking to begin a basic company are very minimal as well as the
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required levels of education and business experience. It therefore is seen as a very attractive
sector and one where “quick” money can be made. As a result of these factors, the industry is
made of a diverse category of players who have different objectives and expectations. The
diversity is inherent in terms of competencies of the CFAs, nature and size of business,
managerial practices and even the amount of business one can handle.
As an apex body ADR should work hard to ensure that there is professionalism in the industry
and that’s its members are able to undertake profitable business within the legal provisions. ADR
performs delegated functions by Customs in registering the CFAs and thus has an upper hand at
ensuring that all the businesses seeking registrations and renewals are able to meet the minimum
threshold to operate in the sector. Through providing the EACFFPC and certification, ADR can
enhance and instill professionalism and instill global best practices with the members in the
industry. In addition, ADR drive towards professionalism in the industry will assure quality
service delivery to all shippers and facilitate industry compliance with legislation and regulation.
To improve on service delivery, ADR should update its members on what is done in the sector of
clearing and freight forwarding at National, Regional and Global levels. This will be done
through study tours in neighboring countries, trainings to get new knowledge regarding clearing
and freight forwarding business and exchange knowledge and best practices at National and
Regional levels. Doing this will improve the quality of service, customer care, value delivery to
members therefore it will develop the professionalization of the sector. In order to achieve this,
ADR will embark to implement and strengthen the following strategies:
Strategies
ADR will pursue the following strategies in this area:
Enforce high professional and ethical standards among all members of ADR through
the signing and observance of code of conduct
Ensure all the CFAs and their staff have gone through the EACFFPCcertification
and are Certified CFAs
Develop,promote and improve the professional excellence of members by providing
a comprehensive Continuous Professional Development program and by assessing
the continued competence of members.
Initiate an award of recognition for excellence in Service Delivery and Performance
– The CFA of the Year and The Best Performing Certificate Student of the Year
Develop collaborative relationships with Institutes of Higher Learning in Eastern
Africa and beyond in view of developing and administering certificate, diploma,
undergraduate and Postgraduate courses in CF and related areas
Develop a Resource Center for use by members, EACFFPC students, researchers,
policy developers and general public
Introduce the FIATA Diploma at the ADR Training Centre
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Expected Outcomes
It is expected that by the end of 5 years the following results will have been achieved:
Attain full compliance with ADR Code of Conduct.
By end of 2013; each of the shareholders in CFAs and at least 1/3 of employees in each
CFA have attained the EACFFPC or a similar qualification.
At least quarterly CPD courses will be conducted annually.
Achievement Awards will be conducted annually to recognize and encourage best
practice.
Institutional development of ADR training center.
4.6.4 Institutional capacity building
In order for ADR to play its rightful role as a captain of the industry, it requires to transform
itself into an entity that is enshrined and recognized by the laws as a body of professionals. The
current status of ADR as an association is based on Labor Code which mandates the association
as a framework for organizing and coordinating the sector. As a professional association, ADR
will have more powers in determining the industry standards, codes of conduct and enforcing the
same. It will have powers to discipline errant members. Such a model is applied by other
professional bodies including lawyers, doctors and engineers. Though the EACFFPC training
will help in professionalizing the industry, a legal status of ADR as a recognized professional
body created by an Act of Parliament will solidify the gains even further. Such a status would
also grow the profile of ADR and its ability to mobilize both public and private fundsand will
lead to ADR being recognized as the genuine representatives of the CFAs.
ADR has to develop its institutional strength and management capacities to become more
effective and ensure its long-term sustainability. As mentioned before, one of the challenges
facing ADR is gaps in achieving an acceptable level of institutional strength and management
capacities. ADR operates in a fragile financial environment and complete dependence on
membership fees and donor funding could threaten its sustainability and may undermine its
efficiency. The diversification of revenue streams, the provision of a steady cash-flow and the
ability to build reserves for periods of financial strain should be an area of ADR’s focus in the 5
year Strategic Plan.
The ideal situation for ADR is to achieve higher degree of effectiveness and ensure long-term
sustainability. The results of enhancing organizational development and institutional
sustainability is that ADR will require to be more focused enjoy greater membership
participation; achieve a more positive image, recognition and acceptance. Some of the key issues
in institutional development and sustainability include: financial sustainability; membership
development; strategic planning and implementation; internal organization, and communications.
ADR shouldalso assign clear tasks and responsibilities to improve the work of the staff members
by implementing effective administrative systems.
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As an institution and in order to achieve desired goals ADR will require a strong people
orientation. ADR will require determining and recruiting key people who will ensure the desired
goals are achieved. As discussed before, ADR has shortages in the number and skills coverage. It
will require recruiting an experienced Advocacy Officer, Legal and Corporate Services Officer
and a Membership Services Officer to begin with. Skills gap will need to be undertaken on the
existing employees to see suitability for the post of Finance and Administration Officer and
Information Technology Officer. The same audit should be able to isolate the key strategic skills
required to function effectively and where gaps are identified then training will be conducted. As
a start key training should focus on Advocacy Skills, Resource Mobilization Skills including
funding proposal development, Marketing Skills, Customer Service Skills among others. To
achieve the right mix of people will require resources. While some of the skills acquisition can
be funded by partners other will require ADR to generate internal funds to support it.
After fulfilling the areas mentioned above, it will lead ADR to be sustainable and compete in
Rwanda and beyond Rwanda (at regional and international levels). But this requires to members
to be informed on new policies and update their skills inclearing and freight forwarding sector by
using the new generation trade facilitation instruments as an example.In order to achieve this, the
following strategies will be implemented and to strengthen ADR:
Strategies
ADR will pursue the following strategies in this area:
Transform ADR into a Professional Association
Develop formidable organization structures, systems, policies and procedures
Strengthen ADR Governance Systems
Develop financial sustainability strategies
Building and strengthen value adding networks and partnerships
Strengthen the Corporate Image by rebranding
Grow the human resource capacity
Develop a Performance monitoring, evaluation and learning framework
Improve on the communication processes including the Internet, website
Develop an annual directory of service providers and an industry quarterly magazine
Expected Outcomes
It is expected that by the end of 5 years the following results will have been achieved:
The association will have transformed from a “trade association” registered under the
provisions of labour code, to a “professional association” with authority and ability to
regulate the conduct of its members.
Annual training programmes in corporate governance for the Board of Directors of the
association.
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Secured Technical Assistance to the office of CEO of ADR, or recruited an independent
CEO with requisite to implement this strategic plan.
Adequate staffing in the core functional areas of the Association.
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CHAPTERFIVE
5.0 IMPLEMENTATION OF THE STRATEGICPLAN
5.1 CriticalSuccessFactors Thecritical success factors for this strategic plan shall be built on:
Strong Secretariat – this is the nerve centre of ADR and its strength determines the level
of development of ADR;
Resources – these are required to fund the various activities under each strategy. The
delivery of the plan is underpinned by the level of resources ADR is able to mobilize. The
development of resource mobilization strategy is the first step towards recognition of the
need to build a stable and sustainable resource base; For ADR to be able to fund its
operations, various strategies as recommended have been identified including the
following:
o Revenue generation from training courses targeting members
o Donor Support Programmes
o Other Income Generating Activities such as:
Directory of Service Providers
Networking Forums
Hire of conference facilities
Industry Magazine/Journal
o Membership Fees – From general membership and associate membership
Human Resources – quality human resources are important to manage and offer quality
services to the members. They will ensure the delivery of all strategies developed. Key
competencies have to be identified and used to identify key staff. Appropriate attraction,
motivating and retaining strategies will need to be put into place once the key staff with
appropriate competencies are identified;
Systems– these are critical in order to deliver guaranteed quality, efficiency and
effectiveness;
Processesand procedures – for managing operations and relationships;
Strategicdirection and shared vision – required to give a long term view, unity of
direction and purpose and to ensure all are focused and aligned to the goals of ADR;
Supportive EC – these are required to positively influence the success of ADR.
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5.2 Implementation Matrix This Strategic Plan should provide the overarching framework for ADR’s activities over the five
year period 2012-2016. The Plan should inform Annual Action Plans (AAPs) – detailed plans of
activities to be carried out every year. These AAPs should be in accord with ADR’s strategic
priorities and should be specifically linked to a particular target.
Strategies Activities Indicators
Outcomes /
Targets
To promote growth and prosperity of its members
Facilitatethestrengtheningof
CFAs through Training
members
Undertake a member
needs assessment
Report June 2013
Training of members
and their staff
No. of Trainings
No. trained
2 per quarter
40 per
quarter
Design member assistance
program
Develop a financial
support program
Support program in
place
December
2014
Develop a Group
Liability Insurance
Product in place December
2014
Creating networking,
benchmarking tours and
business linkages forums
Organize networking
forums
No. of forums
Revenue generated
from forums
2 per year
2% of ADR
revenues
Organize trade
facilitation meetings
No. of Trade
facilitation events
2 per year
Organize benchmarking
tours
No. of tours 1 per year
Provide members with specific
consultancy services
Design possible
products for members
Products developed December
2013
Launch developed
products No of products
launched
% revenue from new
products
2 Per Year
20%
Sensitize and prepare members
for regional integration
especially the Single Customs
Territory (SCT)
Plan and hold
sensitization workshops No. of workshops 1 every
quarter
Plan a feasibility
mission to Dar and
Mombasa
Mission conducted
June 2013
Create member awareness,
understanding and
implementation of
developments in trade
facilitation
Train members on use of
ADR e-portal % trained
% using e-portal
90%
75%
Train members on use of
single-window system
% of members trained 90%
Sensitize on integrated
logistics platform eg e-
freight
% of members trained
and sensitized
90%
Sensitize members on
ASSET
% of members trained
and sensitized
90%
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Strategies Activities Indicators
Outcomes /
Targets
Ensure member satisfaction Establish a member help
desk Help desk in place December
2012
Conduct a member
satisfaction survey Survey tool in place
Survey tool
administered
June 2012
Annually
Develop a Service
Charter Service Charter in
place
Customer
satisfaction index
June 2012
90%
Improve member
communication
Develop a
communication
policy/strategy
Communication
strategy in place
Customer
satisfaction index
March 2013
90%
Increased interventions for advocacy of its members
To enhance the capacity of
ADR to speak on behalf of the
CF business community
Develop an advocacy
strategy
Advocacy Strategy in
place
December
2013
Train the EC and Key
Secretariat staff on
Advocacy
No. Trained All EC and
Key
Secretariat
staff
Identify key areas to
advocate for Number of issues
advocated for
At least 5
every year
Advocate on behalf of
members
Develop and produce
policy and position
papers
Number of position
papers
2 per year
Engage continuously
with the media Number of press
clippings
Number of
interviews given to
the media
2 per quarter
4 per year
Advocate for the reduction or
abolition of various fees by
service providers
Identify fees to focus on
and develop a strategy % reduction
25% or at
par with
regional
charges
Develop mechanisms for
identifying, monitoring and
reporting on NTBs
Develop an NTB
tracking system
Operational system in
place
June 2013
Advocate for the removal of
NTBs and other administrative
bottlenecks
Develop a strategy to
Advocate the removal of
NTBs
% on NTBs identified
and advocatedon
% removed and or
reduced
90%
75%
To promote professionalism of its members
Enforce high professional and Sensitize members on No. of members who 100%
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Strategies Activities Indicators
Outcomes /
Targets
ethical standards among all
members through the signing
and observance of Code of
Conduct
ADR Code of Conduct have signed Code of
Conduct
Reduction in
disciplinary cases
reported
90%
reduction
Ensure all the CFAs and their
staff have gone through the
EACFFPC certification and
are Certified CFAs
Develop a recruitment
strategy
Strategy in place October
2012
Recruit participants No of participants per
year
120
Retain Participants Retention rate 100%
Deliver quality
facilitation
% who pass the
certificate exams
90% pass
rate
Conduct refresher
courses
No of participants per
year
50%
certified
attend
Conduct trainings to
capacity build the
facilitators/lecturers
No of trainings
conducted
2 per year
Develop, promote and
improve the professional
excellence of members by
providing a comprehensive
Continuous Professional
Development
Develop a CPD Program Program developed CPD in place
Administer CPD % of members in the
CPD
No. of CPD events
organized
75%
1 each
quarter
Initiate an award of
recognition for excellence in
Service Delivery and
Performance
Develop the CFA of the
Year Award
Award Scheme in
Place
By June
2013
Develop the Best
Student of the Year
Award
Award Scheme in
Place
December
2012
Identify Sponsors for the
Award
Sponsors in Place By June
2013
Conduct the Award
Ceremony
Ceremony conducted Annual
Develop collaborative
relationships with Institutes of
Higher Learning
Identify and evaluate
possible collaborators
Evaluation Report By end of
June 2013
Sign MOU with the
collaborators
MOU signed December
2013
Administer agreed
courses
No. of courses launched
No. of participants
1 certificate
and 1
Diploma
60 per year
Develop and implement
member capacity building
courses
Conduct a member
training needs analysis
(TNA)
TNA report December
2012
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Strategies Activities Indicators
Outcomes /
Targets
Develop market relevant
courses
No. of Courses
developed
4 courses
Administer the courses No. of courses
administered
2
Ensure the Training centre is
sustainable as a Strategic
Business Unit (SBU)
Develop a Training plan Training plan in place October
2012
Develop a Training
business plan
Business plan in place December
2012
Market training centre
facilities
Revenue generated
from facilities hire
10% ADR
revenues
Develop a Resource Center for
use by members and non-
members
Identify Centre needs
and implement
An equipped centre in
place
December
2013
Launch FIATA Diploma Seek for Approval from
FIATA
Letter of Approval December
2013
Launch the Diploma Diploma intake June 2014
Ensure Training Centre is
certified/recognized by the
Government as a training
Institution
Prepare and apply for
certification
Recognition
Certificate issued
June 2014
Institutional capacity building
Develop formidable
organization structures,
systems, policies and
procedures
Develop and adopt a new
organizational structure
Structure in place December
2012
Develop and implement
operational procedures
and manuals
Policies and
procedures manuals in
place
December
2013
Transform the legal status of
ADR to a Professional
Association
Develop new legal status
documents
Registration
documents in place
December
2012
Seek approval from the
General Assembly
Minutes from the
Assembly
December
2013
Apply for registration as a
Professional Association
Certificate Issued December
2014
Recruit Key/Top ADR’s
officers
Develop Terms of
Reference (TORs) for
recruitment
Terms of reference in
place
December
2012
Conduct Recruitment and
Selection
Positions filled June 2013
Strengthen ADR Governance
Systems
Develop a Governance
Manual
Governance Manual
in place and adopted
December
2013
Set up Committees of
the EC
Committees
constituted
December
2013
Develop TORs for the
EC and the Committees
Developed and
implemented TORs
June 2013
Develop a Performance Evaluation system in June 2013
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Strategies Activities Indicators
Outcomes /
Targets
evaluation system for
EC and the Committees
place and used
Conduct Annual
Evaluation of the
Committees and the EC
Evaluation Report Annual
Conduct annual
retreat/training on
governance for the EC
No. of Trainings
No. of EC members
trained
1 per year
90% of EC
Achieve financial
sustainability
Develop and implement
a sustainability strategy
Sustainability strategy
in place
December
2013
Expand the sources of
income
% increase in income
from IGA
50% Annual
Develop funding
proposals
Amount of funds
generated from
proposals
30%
Annually
Recruit Associate
members
No. of new members
recruited
Revenue from the
Associate members
10
5% Revenue
Improve on member
contributions
Revenue from the
General membership
15%
Revenue
Acquire own office premises Constitute a team to
evaluate different
options
Report on the
feasibility of the
options
June 2013
Implement the best
option
Existence of own
premises
December
2015
Building and strengthen value
adding networks and
partnerships
Map and profile key
partners
Stakeholders profile June 2013
Sign MOUs with key
partners
%. of MOUs signed 75% of key
ADR
stakeholders
Strengthen the Corporate
Image
Conduct a market study
on brand perception
Study report December
2013
Review the ADR
corporate branding
New re-launched
brand, logo, etc
June 2014
Grow the human resource
capacity
Identify HR needs and
recruit
% of staff compliment
in place
90%
Review terms and
conditions of working
Retention Rate
Employee satisfaction
index
90%
90%
Conduct employee TNA
to identify skill gasps
TNA Report June 2013
Train employees on
strategic skills
% strategic skills
coverage
75%
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Strategies Activities Indicators
Outcomes /
Targets
Develop a Performance
monitoring, evaluation and
learning (PMEL) framework
Identify and implement
a suitable PMEL system
A PMEL implemented
and used
December
2013
Develop mechanisms for
collecting information and
dissemination to the
membership
Improve on the website % increase in website
utilization
75%
Develop an ADR e-
portal and update as
need be
e-portal in place
utilized and regularly
updated
December
2013
75%
utilization
Develop a Directory of
Service providers
Identify and collate
sector specific contacts
and trade facilitation
information for the
directory
Directory of Service
Providers developed
and updated annually
Annual
editions
from 2014
Sell advertising space in
the Directory
Amount of revenues
from the directory
10% ADR
revenue
Develop a quarterly Industry
Magazine
Invite and collect
articles for the magazine Quarterly magazine
in place
4 per year
Sell advertising space in
the Magazine Amount of revenues
generated
5% of ADR
revenues
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5.3 Timing of Strategies and Associated Financial Estimates
No Strategies Year 1 Year 2 Year 3 Year 4 Year 5 Budget (RWF)
1 Training programs toward EACFFPC certification and similar
qualifications
16,000,000
2 Study missions and benchmarking with peers, prepare members
for Single Customs Territory (SCT), etc
58,000,000
3 Stakeholder and member satisfaction surveys
25,000,000
4 Public-Private Partnership (PPP) workshops and advocacy
forums about reduction of NTBs and other administrative
hurdles, trade facilitation, access to Mombasa and Dar ports for
Rwandese Operators, etc
111,000,000
5 Continuous professional development (CPD) training programs
for ADR members
53,500,000
6 Enforcement of Code of Conduct and regular Quality Assurance
reviews (oversight function), and best practice recognition
program.
49,000,000
7 Institutional Capacity building and accreditation of ADR
training centre
156,500,000
8 Transformation of ADR from a “trade association” to a
“professional body”
40,000,000
9 Enhancement of corporate governance and Technical Assistance
to ADR Secretariat
35,000,000
10 Improvement in communication systems and practices between
ADR and its stakeholders; including internally with members.
72,000,000
11 ADR Head Office project 300,000,000
Total 916,000,000
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5.4 Financial Projections
Successful implementation of strategy requires that strategies and activities be linked and
supported by resources. The table below presents broad financial projections per objective. As
indicated, a total of RWF 380 Million will be required to fund this strategic plan. This being a
projection may provide a guideline to the resource mobilization strategy. Specific and actual
expenditures will be captured well under a detailed annual financial/business plan to be
developed every year for the purpose of actualizing the strategy. However, a detailed breakdown
of cost per strategy is provided in Appendix II.
5.4.1. Detailed Breakdown of Cost per Key Strategy Areas
No Strategies Budget (RWF)
1 Training programs toward EACFFPC certification and similar
qualifications 16,000,000
2 Study missions and benchmarking with peers, prepare members
for Single Customs Territory (SCT), etc 58,000,000
3 Stakeholder and member satisfaction surveys 25,000,000
4
Public-Private Partnership (PPP) workshops and advocacy
forums about reduction of NTBs and other administrative
hurdles, trade facilitation, access to Mombasa and Dar ports for
Rwandese Operators, etc
111,000,000
5 Continuous professional development (CPD) training programs
for ADR members 53,500,000
6
Enforcement of Code of Conduct and regular Quality
Assurance reviews (oversight function), and best practice
recognition program.
49,000,000
7 Institutional Capacity building and accreditation of ADR
training centre 156,500,000
8 Transformation of ADR from a “trade association” to a
“professional body” 40,000,000
9 Enhancement of corporate governance and Technical
Assistance to ADR Secretariat 35,000,000
10 Improvement in communication systems and practices between
ADR and its stakeholders; including internally with members. 72,000,000
11 ADR Head Office project 300,000,000
Total 916,000,000
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5.4.2 Expected Source of Funds
Expected Source of Funds Percentage Amount (RwF)
ADR's Members 25 % 229,000,000
ADR's Generation of Revenues 50 % 458,000,000
Donors 20 % 183,200,000
Government 5 % 45,800,000
Total 100 % 916,000,000
5.5 Monitoring,ReportingandEvaluation The following M&E framework will be adopted in order to ensure successful implementation of
the strategic plan:-
i. Establish an M&E committee (preferably comprising of the ES and those who directly
report to him) to champion implementation of the strategic plan.
ii. The M&E committee should hold regular meetings (preferably monthly) chaired by the ES,
to review the status of the strategic plan implementation as it relates to their respective roles.
In addition, areas requiring strategy change should be identified.
iii. The M&E committee will avail progress reports regularly (preferably quarterly) to the EC
on the progress made towards the attainment of the goals.
iv. The strategic plan will be reviewed annually so as to ensure that necessary changes in the
objectives, strategy, activities, etc. (informed by new information regarding ADR and the
CF industry or the changes in global, regional and local business environments) are affected.
The ADR M&E Framework will be a results based framework measuring results at the different
levels in the results chain. This will ensure that the desired goals are achieved and in the event of
any problem deviations are realized early. The results chain is presented in the figure below.
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APPENDICES
Appendix I: ProposedOrganizationalStructure
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Appendix II: Proposed Automated System for Secure Transit
As the regional integration advances, various stakeholders are proposing methodologies of
facilitating trade. One such is the replacement of Transit Bonds with an alternative that is in line
with the SCT framework. The Automated System for Secure Transit (ASSET) is an example of a
transit alternative that will require that duties are paid at the port of entry and that this serves as a
guarantee to transit countries for the duration of the transit period. In the current system, each
member state has its own bond system and national controls and procedures for transit goods.
The requirement for transit bonds and other measure cause considerable expense, delays and
interference with regional transport and trade. The proposed ASSET system by passes some of
the administrative issues and hurdles that arise from the national and regional bond schemes.
The ASSET concept is expected to: Facilitate better transparency and accountability in transit
operations, through the utilization of existing IT systems to monitor the entry and exit of the
transit goods at border points; Speed up the handlingofclaimsandremovalof delays caused by
bond acquittals while safeguarding the interests of all parties concerned; Provide an
opportunity to free up resources in the bond managementand transit monitoring units for
revenue authorities; Free up the amount of bonds held in forcein theEAC and COMESA region
hence unlocking more business operation capital to the traders which will enable faster business
growth; Enable faster clearance of transit goods at all entry and exit border points; Provide an
opportunity for banks in participating countries to become centres of excellence for the provision
of such facilities within the EAC and COMESA region; and Reduce transportation and general
cost of goods especially for land locked countries –reducing the cost of doing business in the
EAC.
Whereas when ASSET is introduced it will facilitate some transit operations, there are likely to
be negative effects on ADR members. When operationalized such ASSET will lender some
border operations irrelevant and by extension some CFAs. Currently 50% of revenues for CFAs
are generated from transit fees and as such this portion is likely to be affected. ADR also
generates about 75% of its revenues from the same source by charging a percentage of transit
fees it collects on behalf of the CFAs. The introduction of ASSET will require ADR to re-orient
itself and its members to newer sources of funding. ADR and partners involved will have to
prepare itself and its membership to any eventuality through an engagement and sensitization
strategy. ADR needs to engage with partners for solutions to the impact of such a facility.
Member sensitization workshops will need to be conducted well in advance in order to manage
change and reduce any dysfunctional effects of such a change. ADR could also conduct some
research and develop a position paper on ASSET.
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Appendix III: References
1. Economic Development and Poverty Reduction Strategy (EDPRS), 2008-2012 Ministry
Of Finance And Economic Planning September 2007
2. Protocol on the Establishment Of The East African Community Common Market
3. Rwanda National Policy & Strategy on EAC Integration, February 2012
4. Rwanda Common Market Impact Study January 2009
5. Rwanda Competition and Consumer Protection Policy - 2008
6. White Paper on Logistics and Distribution Services in Rwanda
7. Draft Inception Report on East Africa Freight Logistics Markets Study – (TMEA/EAFL)
8. Corridor Diagnostic Study of the Northern and Central Corridors of East Africa
9. Cross Border Trade in East African Countries: Shared Issues and Priorities
10. ADR Statute
11. ADR Annual Reports for the last 3 years
12. FEAFFA Strategic plan
13. Corridor Diagnostic Study of the Northern and Central Corridors of East Africa
14. Logistics and Distribution Services Strategy for Rwanda – White Paper
15. East Africa Freight Logistics Market Study Draft Inception Report
16. Rwanda National ICT Strategy and Plan (NICI III)
17. Rwanda Business Freedom Index
18. World Bank 2012 Business Environment Snapshot for Rwanda
19. The Global Enabling Trade Report 2012: Reducing Supply Chain Barriers
20. Analytical Comparative Transport Cost Study along the Northern Corridor Region
21. Ministry of Trade and Industry (MINICOM) Strategic plan 2009 - 2012
22. IMF Country Report No. 12/152 for Rwanda. June 2012
23. World Bank Country Data, 2011. http://www.worldbank.org/en/country/uganda
24. World Bank Country Data, 2011. http://www.worldbank.org/en/country/rwanda
25. World Bank Country Data, 2011. http://www.worldbank.org/en/country/burundi
26. World Bank Country Data, 2011. http://www.worldbank.org/en/country/tanzania
27. World Bank Country Data, 2011. http://www.worldbank.org/en/country/kenya
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Appendix IV: Persons Consulted
No Names Position Name of Institution
1 Bagumisa R. Franklin Legal & Compliance Manager Horizon Logistics
2 Bigirimana Celine Treasurer ADR
3 Bitega Anita Executive Secretary ADR
4 Butera Emmanuel Director and Water Ways Transport Rwanda Utilities Regulation
Agency
5 Gashayija Nathan Coordinator of EAC Programs MINEAC
6 Gossiaux Eve Acting PSO/CSO Program Officer Trade Mark East Africa
7 HabiyambereImmaculée Senior Program Advisor Trade Mark East Africa
8 Karamuzi Edward Finance and Administration Officer ADR
9 KarimbaAnataria PSO/CSO Program Officer Trade Mark East Africa
Kanamugire Silas Transport and Trade Facilitation
Adviser
Trade Mark East Africa
10 Manzi Antoine Director of Trade and Policy
Advocacy
Private Sector Federation
11 Mathenge John Regional Executive Officer FEAFFA
12 MbayaAbdou Operations Manager SpedagInterfreight
13 MugambageMundaneh Managing Director Pioneer International
14 Mukeshimana Claudette Financial Assistant ADR
15 MulindaMbabazi Grace Managing Director Royal Links Ltd
16 Murenzi Theodore Executive Secretary ACPLRWA
17 MutegwarabaMediatrice Clearing Officer Dove Freight
Muvunangoma Abdul Managing Director Rwanda Business and
Clearing Agency
18 Mohamed Athman Ali
Director, ICT for Trade and Transport
Facilitation
Trade Mark East Africa
19 Ngaracu David Commercial Manager Spedag Interfreight
20 Nkubito Roger Commercial & Business
Development Manager
SDV Transami
21 Ntezimana Eric Operations Manager Top Freight
22 Ntirenganya Innocent Accountant Dove Freight
23 Ntirushwa P Canisius General Manager CMA-CGM
24 Nyebaza Josephine 2nd
Vice Chairman ADR
25 Priestley Mark Country Director Trade Mark East Africa
26 Rurangwa Jackie Managing Director Multilines International
27 Rusagara John Bosco Chairman ADR
28 Safari Vincent Coordinator of NMC on NTBs at
MINICOM
MINICOM
29 Seka Fred 1st Vice Chairman ADR
30 Shyaka Olivier IT and Communication ADR
31 Tusabe Richard Commissioner for Customs Services Rwanda Revenue Authority
32 ZimulindaPhilbert Head of Import Rwanda Bureau of Standard
33 Zitunga Daniel Training Coordinator ADR
