Publication - Working Paper
Small markets like Rwanda tend to produce small firms, and helping small firms to become large firms requires making use of international markets. Trade has allowed the Netherlands to become home to world-wide giants such as Philips and Royal Dutch Shell, and Switzerland to give birth to Nestle and Brown Boveri. Trade allows firms to reap productivity gains through economies of scale, scope, and specialization – and it is this productivity growth that, together with investment in capital and upgrading of labour, leads to rising incomes. The EAC provides an opportunity for the Rwandan private sector to reach a wider market – within the five member countries and, through deeper integration with them, to global markets.