Jiangyin BaoRui Textile, one of China's biggest textile companies, on Tuesday signed a deal that will see the Chinese giant start producing fabrics and finished clothes in the country through a local partner, Apparel Manufacturing Group (AMG).
The signing ceremony was held in China.
Dianne Mukasahaha, Chairperson of the AMG, signed on behalf of her company while Hua Huang the chairman of Jiangyin BaoRui Textile Company signed on behalf of BoaRui.
A statement from the Private Sector Federation indicates that Chinese textile experts will also provide new technology and capacity building to Rwandans in the textile sector, as per the new deal.
This is seen as a new move that will reduce the importation of high-end clothes from abroad.
"This is a great milestone for our sector. We have been facing the challenge of inadequate fabrics and importing finished clothes from different countries but now this will be done locally," said Dianne Mukasahaha, Chairperson of the AMG Company.
The local partner, AMG, is one of the companies formed by the PSF with the main aim of promoting collective investment.
According to the agreement, AMG will officially represent the Chinese garment company.
Warehouses will be set up to cater for effective production of fabrics and clothes.
A delegation of Rwanda business operator's textile industry is currently in china to look for potential investment partnerships.
Members of AGM are mostly small and medium enterprises who were brought together under the same Company.
With the parentship, the produced clothes will be sold locally and in other African markets at a competitive price.
Eric Kabera, the head of Communications and Marketing at PSF, said it is important to promote collective investment with the aim of finetuning and enhancing performance of the sector.
He said: "The whole idea is to produce these goods locally but also provide trainings to Rwandans. That's why we are promoting collective investment by targeting different sectors.
"We have other companies that have been established such as Joint Exporters Group, Heart of Africa Ltd (H.A.T), and Nine United Traders Ltd that deals in cement.
Kabera said the PSF is also targeting other sectors to promote collective investment.
The Joint Exporters Group (JEG) deals in exports while H.A.T is a clearing and forwarding agency that deals in a travel and tour service as well as financial advisory.
The Jiangyin BaoRui Textile Company boasts a set of big production equipment, including crochet machines, stranding machines, flower twisting machine and playing machines. With A 40,000 square metres modern workshop of productivity of more than 2500 tonnes, the products are exported to more than 30 countries. They are used in making knitted fabrics, weaving, carpets, bathrobes, shawls, scarves, hats, gloves, socks and other decorations.