A-Link, in Kigali, Rwanda, has been operating for almost two years and is Africa’s first mobile phone assembling plant. The company’s CEO, Edward Yin, said the company has throughout this year been hit by low sales and has been operating without making a profit.
The company is now producing less than 200 handsets per day compared to the 300 handsets per day that it was producing last year when it was launched. The company’s problems have been compounded by cheap imported handsets being sold promotionally by mobile service providers that are competing to increase their subscriber base.
In this year’s budget, the Rwandan government slashed the import duty on mobile phones to zero percent from 18 percent in order to encourage imports of more foreign manufactured handsets and allow competition. This means that locally manufactured handsets have become slightly more expensive than foreign-made handsets.
However, in Zambia, where a similar plant exists, the government increased import duty on foreign manufactured handsets to 15 percent from 5 percent in order to protect the local industry from competition.
A-Link Technologies has since inception been producing three models — A100, A200, A300 — with more models still said to be in the works. The phones feature color screens and radios among other amenities.
"It’s difficult for any local company to continue existing in an environment characterized by cheaper foreign made phones. The Rwandan government should not in the first place have slashed the import duty on imported phones," said Walter Tampfumanei, communications officer at the Africa Center for ICT Development.
Hoping to boost the company’s sales and save it from closing, A-Link Technologies, through its partner in China — the China Link Digital and Technology Company — said it has started manufacturing dual SIM card handsets, which will be sold in Rwanda cheaply. The dual SIM card handset allows people connected to two different networks to use only one handset. The company hopes these phones will increase sales, as many subscribers in Africa are connected to more than one network.
Since April this year, A-Link Technologies has only been able to export 200 phones to Uganda.
On the other hand, the Zambian M.mobile plant, launched early this year, is producing 1,000 handsets per day and has already exported about 10, 0000 handsets..
M.mobile is currently exporting phones to Zimbabwe and is about to start exporting to other Eastern and Southern African countries including South Africa, Kenya, Rwanda, Burundi and Tanzania. The Zambian plant has also started manufacturing dual-SIM card handsets.
Like Zambia, Rwanda is trying to position itself to be the hub of ICT in the Eastern and Southern Africa outside South Africa and Nigeria.