China’s transformation proves that with belief and the right mindset, countries can overcome any challenge and achieve greatness.
These are 7 lessons that Rwanda can learn from China in order to ensure economic transformation.
{{Lesson 1: A nation must create its own economic and political system guided by its national interests.}}
After the founding of the People’s Republic of China in 1949, the country’s leadership chose a political system allows multiparty cooperation under the stewardship of Chinese Communist Party (CCP).
China’s economy has been defined as a “’socialist market economy”, and does not fit into any one system. Rather, it takes various parts of other systems and combines them to create a system that best serves its national interests.
Similarly, Rwanda adopted a political system of consensus whereas no political party dominates all branches of government.
Home-growth initatives and systems that are rooted in the Rwandan culture and work for the Rwandan people ensure that national interests are met.
{{Lesson 2: A nation must always have clear programmes that are bold and have vision.}}
Throughout China’s history, there have been bold national programmes. One such programme is the Five-Year Plan. The goal of the latest 5 year plan, launched in 2021, is to reduce the reliance on foreign technology and dependence on imported resources, and to double down on existing plans for industrial modernization and technological innovation.
Another bold programme is the Belt and Road Initiative. Today, The Belt and Road Initiative contributes towards transforming Africa through infrastructure development, unemployment reduction and improved trade, among others
In similar vein, Rwanda’s leadership created Vision 2020 and followed it up with Vision 2050.
Launched in 2000, Vision 2020’s main objective was transforming the country into a knowledge-based middle-income country, by impoving goverance, human capital, infrastructure and the private sector.
Vision 2050, which was launched in December 2020 by President Paul Kagame, aims to transform Rwanda into an Upper-Middle Income Country by 2035, and into a High-Income Country by 2050.
{{Lesson 3: A nation must train its youth in skills that serve the national interests.}}
In China, each year, university admissions for various disciplines are allocated in proportion to what skills the country requires most at that point in time. If China needs more engineers, then there will be more university admissions for engineering than other disciplines.
Students who do not make it into university usually end up in a vocational skills training college that educates them in line with the needs of the country, to ensure employment on completion.
Similarly, Rwanda has invested billions of francs in educating young people through IPRCs, Coding Academies as well as other institutions that teach hands-on skills. This is in addition to the traditional universities as well.
{{Lesson 4: A nation must be proud of its cultural heritage so it can have a strong national identity.}}
China has turned traditional holidays that were celebrated by its ancestors centuries ago, such as the Spring Festival and the Dragon Boat Festival, into public holidays.
On its side, Rwanda has endeavored to do the same with its Umuganura National Holiday that occurs every first Friday of August and Umuganda, the monthly community cleaning exercise.
{{Lesson 5: A nation’s State-Owned Enterprises can be key drivers of the economy.}}
The key drivers of China’s economy are state-owned enterprises (SOEs). Enterprises are identified as SOEs if the state owns, directly or indirectly, over 50.01% of shares in them. The 2022 Global Fortune 500 list, which lists the largest companies in the world, is dominated by Chinese companies, the majority of whom are SOEs.
The Rwandan government also rethought the notion that says governments should not be directly involved in economic activity.
By investing in strategic sectors such as aviation, the MICE industry, and real estate, the Rwandan Government has proved that its active role in the local private sector benefits citizens.
{{Lesson 6: A nation must be proud of and promote its own brands.}}
The Chinese have pride in their good local brands and always make a conscious decision to support them whenever possible. An example of this is the Chinese momentum in the Electric Vehicle industry. Since 2020 the number of electric vehicles sold annually in the country has grown from 1.3 million to 6.8 million.
Chinese models are now becoming popular outside China as well and have started competing with brands such as Tesla.
Similarly, the Government of Rwanda has instituted the ‘Made in Rwanda’ policy’.
The Made in Rwanda was initiated as a strategy to promote the consumption of locally made products. The rationale is to increase exports and reduce import surplus.
{{Lesson 7: A nation that exploits its competitive advantage can become globally competitive.}}
China has capitalised on its strengths to be globally competitive. An example of this strength is in the semiconductor industry.
China aims to take the lead in global semiconductor growth and is steadily building capability to supply domestic demand for semiconductor chips.
Likewise, Rwanda can market its competitive advantage in order to ensure prosperity.
Rwanda is one of the fast-growing developing countries in the world with a projected 7.9% GDP growth in 2023 according to the IMF, as well as a stable inflation and exchange rate.
Rwanda enjoys a remarkable sense of personal security and political stability and businesses located in the country have access to a combined East African Community and Comesa market made up of over 500 million people.
Leave a Reply