“Impacts of environmental regulation on business environment: the case of ban of polythene bag use in Rwanda”: case of Rwanda in the region “2007 – 2013”.

Abstract

Prohibition of manufacturing, importation, use and sale of polythene bags in Rwanda is in place since 2008 and cabinet passed the law banning the use of all non-biodegradable polythene bags from the country. Upon enforcement of this legislation, industries that manufactured and traded plastic bags, as well as exporters, businesses and people that imported them for sale and profit gains had concerns and they are facing a very big problem in terms of packaging cost. The ban has positive and negative impacts. On positive side Rwanda got regional and international credit for environmental protection and green economy. The ban might be the national proud in regards to have a green business and growth, and upholding the international recognition for the country cleanliness. On negative side the business community (some manufacturers, traders, exporters and importers) that were affected by the ban, the cost of packaging and production increased for local companies and reduced its level of competitiveness at national and regional level. Given the time, resources availability and the purpose of the research, sampling confirmed to be the right way to conduct this study, 7 represent the population affected by the mentioned law. Conducting interviews was considered as a method for this research, as a technique used to understand the business environment. Primary data were collected from Ministry of Trade and Industry in its unit in charge of Export and Import by using a guiding table format, with the aim of providing relevant information on this topic. This guided the researcher in gathering information and empirical analysis will be used to measure and interpret the data collected. Considering many macro-economic factors and economic integration principles such as comparative advantages, trade creation, trade diversion, economies of scales, aggregate demand and aggregate supply and many others, harmonization of the laws should at the same level in the EAC country members and encouraging investors to invest in recycling plants.