Rwanda is negotiating with Kenya’s Rai Group on a major sugar investment project aimed at boosting domestic production and cutting the country’s rising dependence on imports, officials said.
The proposed project involves an 11,000-hectare sugarcane concession in Nyagatare District, where the Kenyan conglomerate would develop large-scale plantations and construct a processing plant.
The discussions were confirmed by Trade and Industry Minister Prudence Sebahizi during a parliamentary briefing, according to local reports.
The initiative forms part of Rwanda’s broader strategy to stabilise its sugar supply chain, as domestic production has struggled to keep pace with rapidly increasing demand.
Rwanda’s only operational producer, Kabuye Sugar, once supplied around 45 percent of national consumption but now accounts for only about 10 percent, leaving a widening gap filled by imports.
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As a result, sugar imports have surged dramatically over the past decade, rising from 15,000 tonnes in 2015 to 196,000 tonnes in 2025, while the import bill has jumped from US$8.8 million to nearly $146 million.
Authorities say the proposed investment by Rai Group could supply up to 50 percent of domestic sugar demand, significantly reducing import pressure and improving food security.
Officials attribute the decline in local production not to shrinking capacity but to insufficient expansion in the sector as demand has grown faster than investment in new factories.
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“As no new factory has been established over time, imports have increased to meet growing domestic demand,” Sebahizi said.
The project would mark one of the largest agro-industrial investments in Rwanda’s sugar sector and is expected to integrate large-scale farming with industrial processing.
For Rai Group, the deal would strengthen its footprint in East Africa’s sugar industry, where it already operates extensively in Kenya.
The company has a significant presence across the sugar value chain, including cultivation, milling, refining and distribution, and is among the dominant players in Kenya’s sugar market.
If concluded, the Rwanda project would expand its regional portfolio and position it as a key supplier in a market that continues to rely heavily on imports.
Analysts say the initiative reflects a broader regional trend in which governments are seeking private investment to reduce reliance on imported food commodities and strengthen domestic agro-processing capacity.
However, they note that success will depend on execution capacity, land utilisation efficiency and long-term price competitiveness against established regional suppliers.
The proposed investment is also expected to contribute to rural development in eastern Rwanda, where agricultural expansion remains a central pillar of the government’s economic transformation agenda.
If implemented, the project could mark a significant shift in Rwanda’s sugar industry, potentially transforming it from an import-dependent market into a more self-sufficient producer within the next decade.
