Rwanda : reaping the fruits of

economic reforms by Nzayisenga

adrien

Rwanda‟s accession to the Commonwealth in November 2009 marked another

step in the landlocked African nation engaging with the outside world.
The group of mostly former British colonies brings together industrialised and
developing nations, espouses democracy and good governance, and is a
consensus-seeking forum on issues like economic policy, trade and climate
change. Rwanda‟s accession is a recognition of its rehabilitation since the
genocide in 1994, said Rwanda‟s Foreign Minister Louise (...)
Rwanda’s accession to the Commonwealth in November 2009 marked another step in
the landlocked African nation engaging with the outside world.
The group of mostly former British colonies brings together industrialised and
developing nations, espouses democracy and good governance, and is a consensus-
seeking forum on issues like economic policy, trade and climate change. Rwanda‟s
accession is a recognition of its rehabilitation since the genocide in 1994, said
Rwanda‟s Foreign Minister Louise Mushikiwabo at an audience with journalists in
London.
“The genocide and discrimination was, in some ways, due to a paranoia and fear of
opening up. Our government now has a deliberate policy to open up. The more
Rwandans come and go, the more they will benefit, and Rwanda joining the
Commonwealth is part of this policy to open doors.”
Rwanda‟s joining the Commonwealth is just the latest in a stream of initiatives to
engage with the outside world that is starting to entice investment into the country.
Despite the chill of last year‟s global economic downturn, foreign investment jumped
40% to $1.1bn in 2009 and is expected to rise 20% this year.
Rwanda recently became the World Bank‟s biggest business reformer according to its
Ease of Doing Business Index, rising to 67th position overall, with starting up a
business, registering property, paying taxes and enforcing contracts all getting easier.
The Rwanda Development Board says it will simplify the issuance of land and
building permits and promises to work with the East African Community trade bloc to
address red tape and non-tariff barriers. “It now takes a Rwandan entrepreneur just
two procedures and three days to start a business,” said the World Bank.
Rwanda‟s drive for private sector investment to transform its smallholder agricultural
economy into a regional hub for financial services, ICT and tourism is finally starting
to bear fruit. Investment is moving into the banking sector as groups seek to tap
Rwanda‟s unbanked population.
Kenya Commercial Bank set up in Rwanda in 2008 and has expanded its branch
network to nine; it is the only company that is quoted on the Rwanda bourse following
its cross listing in 2009. Nigeria‟s Access Bank has a 75% stake in Rwanda‟s fourth-
largest bank, Bancor SA, and is anchoring its East Africa push out of Kigali. “Access
Bank‟s presence in Rwanda is vital for our reaching the vast East African market,”
said Access Bank‟s Deputy Managing Director Herbert Wigwe.
Dutch group Rabobank has a stake in Banque Populaire du Rwanda; and ShoreCap
International and Germany‟s African Development Corporation – which also has a
controlling stake in Simtel, the national electronic payment transactions provider – are
also on the ground. Tourism, the country‟s biggest foreign exchange earner, is
growing. In 2007, tourists spent $209m and in 2008, visitor numbers to resorts like
Virunga National Park and Lake Kivu jumped 50%.
Commentators highlight investor opportunities in high-end resorts. “There are 187
hotels in Rwanda and only seven are upper range,” says the Rwanda Development
Board (RDB). Rwanda was among the countries hit by the fallout from the collapse of
the Dubai sovereign wealth fund in 2009. A $230m venture with Dubai World to
build six tourism projects collapsed, leaving just two – the Nyungwe Forest Lodge
and Gorilla‟s Nest Hotel – worth around $25m.
Plethora of investments
In Rwanda‟s biggest foreign investment to date, New York-based ContoursGlobal, a
privately owned renewable power developer, is ploughing $325m to harness methane
gas to boost electricity generation compressed under the waters of Lake Kivu, one of
Africa‟s great lakes, which lies on the border of Rwanda and the DR Congo.
The company plans the first 25MW of the project to connect to the grid by October
this year and says it will total 100MW on completion in 2012. Most of Rwanda‟s
current 69MW power output comes from oil generators and hydropower. Elsewhere,
South Africa‟s Industrial Development Group is conducting a feasibility study to
build a gas-to-liquid plant on Lake Kivu that would convert methane gas into products
such as diesel, petrol and liquid petroleum gas.
Canadian group Vangold Resources, which discovered signs of oil under Lake Kivu
in aerial surveys, is also preparing an oil survey under a Special Hydrocarbon
Exploration Licence. Vangold holds exclusive exploration rights to a 1,631sq km
block. The government, which says it is targeting 90% of its electricity from
renewable sources, has also signed biodiesel deals with Britishbased Eco Positive and
US-based Eco-Fuel Global, together worth around $250m.
The company aims to meet up to 20% of domestic diesel demand from Jatropha-
derived biofuels. Telecom companies have also jumped in. Sweden‟s Millicom
International Cellular has just started operations following a $120m investment after
winning Rwanda‟s third mobile licence in 2008. Trading under the brand name Tigo,
the operator joins South Africa‟s MTN and Libyan-owned Rwandatel in providing
mobile phone services. At the moment, MTN and Rwandatel have just two million
subscribers, representing 20% market penetration. “We are here to compete. We want
to increase penetration and accessibility to telephone services that are affordable,”
says Tigo chief executive Alex Camara.
The company aims to meet up to 20% of domestic diesel demand from Jatropha-
derived biofuels. Telecom companies have also jumped in. Sweden‟s Millicom
International Cellular has just started operations following a $120m investment after
winning Rwanda‟s third mobile licence in 2008. Trading under the brand name Tigo,
the operator joins South Africa‟s MTN and Libyan-owned Rwandatel in providing
mobile phone services. At the moment, MTN and Rwandatel have just two million
subscribers, representing 20% market penetration. “We are here to compete. We want
to increase penetration and accessibility to telephone services that are affordable,”
says Tigo chief executive Alex Camara.
Rwanda‟s ITC ambitions, outlined as a „Priority Sector‟ in the government‟s Vision
2020 have also got a boost from the newly laid fibre-optic cable between Kigali and
Mombasa. The submarine cable means the government‟s regulatory reform,
infrastructure investment and education initiatives will finally start to bear fruit.
Operators and the government are currently negotiating to acquire bandwidth from the
cable, which will cut the price of accessing the Internet to as little as $100/mbps from
current astronomical levels that range between $1,500-$5,000/mbps on costly and
unreliable satellite connections.
Patrick Nyirishema at the RDB says, “Companies set to benefit most are ICT
operators and service providers and we expect an explosion in broadband service
subscriptions with cheaper international bandwidth. The only constraint is affordable
access devices, but the operators and government are devising ways to overcome this.
Affordable Internet will greatly impact academia, business, government and society in
general.” China is funding a $200m conference centre in the capital Kigali,
representing another major part of Rwanda‟s ambition to become a regional
information and communications hub.
Privatisation plans
Rwanda‟s mineral sector is its secondlargest foreign-exchange earner after tourism.
Ore exports, processed to extract tin, coltan and tungsten used in consumer
electronics, brought in $91.3m in 2008, according to Central Bank statistics. Mineral
re-exports from neighbouring countries rose to $43.9m, amounting to 17% of total
exports, up from $30.3m in 2007. Rwanda acts as a major conduit for mineral re-
export from the DR Congo, where China holds a $6bn infrastructure for-minerals
contract.
The government hopes to lure investments with results of a national mining survey to
identify mineral deposits. It is also putting together „a strong investor-friendly legal
and policy framework‟, according to the RDB, which highlights particular
opportunities in processing ores. The government promises to overhaul crumbling
infrastructure with massive investment in the pipeline including a $4bn investment in
Isaka Railway due to start in 2014, $300m in Bugesera Airport and a $12m
investment in Kigali‟s Industrial Park.
Funding might be raised from government sell-offs including the government‟s recent
announcement to privatise its 30% stake in brewer Bralirwa. The government has said
it will sell 25% of its stake to the public and 5% to Dutch brewer Heineken, which
already has a 70% stake in the company. The 50-year-old brewer, Rwanda‟s largest,
also bottles Coca Cola products.
Govt prioritizes Made-in-Rwanda, infrastructure in 2017/18 budget
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BK nets Rwf 5.6 billion in 2017 first quarter

Rwanda economy grows by 1.7% in

quarter one, services sector leads
 Nzayisenga Adrien(researcher) Tel +250784296338
email:nayisengadrianos@gmail.com, nayisengadrianos@yahoo.com, nayisengadrianos@outlook.com
Rwanda‟s gross domestic product (GDP) grew by 1.7 percent in the first quarter
of 2017 compared with the same period in 2016, the National Institute of
Statistics Rwanda has revealed in a report released today. The report indicates
an estimated GDP growth of Rwf1,817 billion at current market prices; i.e 1.7
% up from Rwf 1,557 billion in the same quarter of the previous year.
The services sector which grew by 4% accounted for 46 percent of GDP, while
agriculture which grew by 3% (...)
Rwanda’s gross domestic product (GDP) grew by 1.7 percent in the first quarter of
2017 compared with the same period in 2016, the National Institute of Statistics
Rwanda has revealed in a report released today. The report indicates an estimated
GDP growth of Rwf1,817 billion at current market prices; i.e 1.7 % up from Rwf
1,557 billion in the same quarter of the previous year.
The services sector which grew by 4% accounted for 46 percent of GDP, while
agriculture which grew by 3% contributed 32 percent of the GDP, the equivalent of
Rwf 578 billion. The industrial sector contributed 15 percent.
The growth in the services sector, NISR has said, is attributed to the growth in hotels
and restaurants which grew by 17%, real estate which grew by 8%, administrative and
support activities which grew by 25%.
Within industry, manufacturing activities increased by 7 percent boosted by food
processing activities which increased by 13 percent and manufacturing of chemicals,
rubber and plastic activities which grew by 28 percent. Construction activities
declined by 7 percent.
The Director General of he National Institute of Statistics of Rwanda (NISR), Yusuf
Murangwa

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he African Continental Free Trade

Area: Moving African integration
further forward

By Dr Ibrahim Assane Mayaki

On 5 April 2018 at 11:12

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Comments : 0

00

Twenty years ago, I hoped for an Africa that would draw closer and forge
forward boldly, despite a bag of mixed fortunes. Rwanda had just been blighted
by genocide; the ubiquitous coup d‟état still reared its ugly head in West Africa;
although a tentative calm prevailed in Central Africa, political tensions
simmered below the surface; Zaïre was in the throes of the „first Congo war‟;
the civil war in Somalia grew in magnitude and intensity; Ethiopia began an
experiment in state-led macroeconomic planning; a democratic South Africa
rose from the ashes of Apartheid, a veritable validation of the OAU‟s ultimate
goal of political liberation for Africa.
An interim period of positive change ensued, a growth fuelled by new media
including the Internet, greater multiculturalism and a stronger attachment to
democratic principles.
In March 2018, 44 of the 55 African Union Heads of State and Government enacted
the African Continental Free Trade Area agreement (AfCFTA) in Kigali, Rwanda at
its 10th Extraordinary Session, under the able leadership of H.E. President
Mahamadou Issoufou of Niger, with H.E. President Paul Kagame of Rwanda as
current AU Chairperson and H.E. Moussa Faki Mahamat, Chairperson of the AU
Commission. Once in force AfCFTA will be the largest trade zone in the world,
increase intra-African trade by 52% by the year 2022, remove tariffs on 90% of
goods, liberalise services and tackle other barriers to intra-African trade, such as long
delays at border posts.
The end of colonialism in the early 1960s created 55 African countries which cut
arbitrarily across ethnic, cultural and traditional boundaries. They established the
Organisation of African Unity (OAU) to promote unity and solidarity on one hand yet
emphasised territorial sovereignty on the other. This hamstrung the OAU insofar as
national affairs were concerned, and helped create regional economic blocks or
communities (RECs) in the mid-1970s.
RECs engendered political and economic integration. The Economic Community of
West African States (ECOWAS) and the East African Community (EAC) signed
agreements for the free movement of goods, services and people. There are now 8
AU-recognised RECs and a number of sub-regional bodies that are actively pursuing
Africa‟s integration agenda.
In 1991 the Abuja Treaty established the African Economic Community (AEC),
building on RECs for integration. At the 2001 OAU Summit, African Heads of States
and Government adopted the New Partnership for Africa‟s Development (NEPAD) as
a further vector to accelerate African economic co-operation and integration. The
Summit recognised the importance of OAU input into REC programme planning and
implementation. In 2002, the Constitutive Act of the AU was adopted in Lomé, Togo,
formally replacing the OAU.
These milestones show that African economic integration is best pursued on a
regional basis.
Rethinking Africa‟s priorities is urgently called for. In this regard Agenda 2063, a
consolidated strategy for sustained political and economic integration and prosperity,
was launched by African Heads of State and Government at the 50th Anniversary of
African Unity in 2013. Agenda 2063‟s first Ten-Year Implementation Plan (2013-
2023) draws heavily on NEPAD‟s experiences. Beyond these broad strokes in
development priorities and programmes, African development must be translated into
concrete action.
While business and consumer confidence have improved, investment, trade and
productivity have not. This has a direct impact on both foreign and domestic
investments in Africa, particularly in infrastructure. As the world‟s second-fastest
growing region, Africa holds much promise for those willing to invest time to study
our local economies and identify opportunities presented by a booming middle class
with an endless appetite for consumables.
Although the Africa Report 2017 shows that virtually all countries plan large
infrastructure projects and understand the need to industrialise, Africa cannot afford to
be an „investment risk‟ for infrastructure projects that advance sustainable inclusive
development.
To this end, the AU-NEPAD Continental Business Network (CBN) continues to de-
risk infrastructure projects in order to attract financing, especially through Pension
and Sovereign Wealth Funds. In September 2017, NEPAD and the CBN initiated an
Africa-led and Africa-owned campaign to increase African asset owners‟
contributions to African infrastructure from approximately 1.5% of their assets under
management (AUM) to 5% of AUM. By using financial resources available on the
continent and strengthening public-private partnerships, infrastructure investments
should increase. The CBN has called for a more strategic engagement with domestic
institutional investors in support of this campaign.
The AfCTA, is a monumental step for Africa; another significant milestone in
Africa‟s integration process. I have to however aptly point out that the AfCFTA was
signed in Kigali the capital that experienced complete turmoil some 24 years ago but
is now poised to become the futuristic “Wakanda.”
Dr Ibrahim Assane Mayaki, a former Prime Minister of Niger, is the current CEO
of the African Union’s NEPAD Agency.