{Rwanda\u2019s accession to the Commonwealth in November 2009 marked another step in the landlocked African nation engaging with the outside world.
\n}<\/p>\n
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\u2019s accession is a recognition of its rehabilitation since the genocide in 1994, said Rwanda\u2019s Foreign Minister Louise Mushikiwabo at an audience with journalists in London.<\/p>\n
\u201cThe 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.\u201d<\/p>\n
Rwanda\u2019s 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\u2019s global economic downturn, foreign investment jumped 40% to $1.1bn in 2009 and is expected to rise 20% this year.<\/p>\n
Rwanda recently became the World Bank\u2019s 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. \u201cIt now takes a Rwandan entrepreneur just two procedures and three days to start a business,\u201d said the World Bank.<\/p>\n
Rwanda\u2019s 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\u2019s unbanked population.<\/p>\n
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\u2019s Access Bank has a 75% stake in Rwanda\u2019s fourth-largest bank, Bancor SA, and is anchoring its East Africa push out of Kigali. \u201cAccess Bank\u2019s presence in Rwanda is vital for our reaching the vast East African market,\u201d said Access Bank\u2019s Deputy Managing Director Herbert Wigwe.<\/p>\n
Dutch group Rabobank has a stake in Banque Populaire du Rwanda; and ShoreCap International and Germany\u2019s African Development Corporation \u2013 which also has a controlling stake in Simtel, the national electronic payment transactions provider \u2013 are also on the ground. Tourism, the country\u2019s 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%.<\/p>\n
Commentators highlight investor opportunities in high-end resorts. \u201cThere are 187 hotels in Rwanda and only seven are upper range,\u201d 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 \u2013 the Nyungwe Forest Lodge and Gorilla\u2019s Nest Hotel \u2013 worth around $25m.
\nPlethora of investments<\/p>\n
In Rwanda\u2019s 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\u2019s great lakes, which lies on the border of Rwanda and the DR Congo.<\/p>\n
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\u2019s current 69MW power output comes from oil generators and hydropower. Elsewhere, South Africa\u2019s 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.<\/p>\n
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. <\/p>\n
The company aims to meet up to 20% of domestic diesel demand from Jatropha-derived biofuels. Telecom companies have also jumped in. Sweden\u2019s Millicom International Cellular has just started operations following a $120m investment after winning Rwanda\u2019s third mobile licence in 2008. Trading under the brand name Tigo, the operator joins South Africa\u2019s 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. \u201cWe are here to compete. We want to increase penetration and accessibility to telephone services that are affordable,\u201d says Tigo chief executive Alex Camara.<\/p>\n
The company aims to meet up to 20% of domestic diesel demand from Jatropha-derived biofuels. Telecom companies have also jumped in. Sweden\u2019s Millicom International Cellular has just started operations following a $120m investment after winning Rwanda\u2019s third mobile licence in 2008. Trading under the brand name Tigo, the operator joins South Africa\u2019s 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. \u201cWe are here to compete. We want to increase penetration and accessibility to telephone services that are affordable,\u201d says Tigo chief executive Alex Camara.<\/p>\n
Rwanda\u2019s ITC ambitions, outlined as a \u2018Priority Sector\u2019 in the government\u2019s Vision 2020 have also got a boost from the newly laid fibre-optic cable between Kigali and Mombasa. The submarine cable means the government\u2019s 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.<\/p>\n
Patrick Nyirishema at the RDB says, \u201cCompanies 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.\u201d China is funding a $200m conference centre in the capital Kigali, representing another major part of Rwanda\u2019s ambition to become a regional information and communications hub.
\nPrivatisation plans<\/p>\n
Rwanda\u2019s 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.<\/p>\n
The government hopes to lure investments with results of a national mining survey to identify mineral deposits. It is also putting together \u2018a strong investor-friendly legal and policy framework\u2019, 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\u2019s Industrial Park.<\/p>\n
Funding might be raised from government sell-offs including the government\u2019s 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\u2019s largest, also bottles Coca Cola products.<\/p>\n","protected":false},"excerpt":{"rendered":"
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