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  • IFC invests US$7.2m for SME development

    {{The International Finance Corporation an arm of the World Bank, is investing US$1.6 million in equity in Business Partners Rwanda SME Fund (BPI Rwanda). The fund aims to provide financing and management support for up to 70 SMEs, increasing employment and local entrepreneurship in Rwanda.
    }}

    IFC’s investment comprises about 20% of the fund’s total committed capital of $7.2 million. The target size for the fund is $8.0 million. Other key investors include the Rwanda Enterprise Investment Company (REIC) and DOEN, a Dutch NGO. The Business Partners private equity fund responds to a growing need for risk capital and quality management advice in Rwanda.

    Jean Philippe Prosper, IFC Director for East and Southern Africa, said “Business Partners’ Rwanda chapter provides a much-needed option for socially responsible financing. By supporting small and medium enterprises, the fund will help Rwandan entrepreneurs build businesses and create jobs across the country. IFC and Business Partners share a commitment to responsible business models, which should increase focus on social and environmental performance standards in Rwanda.”

    Business Partners International is a South Africa based financier of SMEs, established in 2004 as a joint venture between IFC and Business Partners. The BPI Rwanda fund will be managed by a local team, under the oversight of Business Partners International. The fund will tap into the expertise of locally based managers and combine financing with business advisory services.

    Nazeem Martin, BPI CEO, said “The partnership with IFC will enable BPI to provide comprehensive technical services to Rwandan SMEs. This includes the installation of management information systems, market research and product development; quality assurance; process efficiency improvements; and staff training and skill development. With this wide range of services, BPI aims to improve corporate governance with an eye towards social and environmental returns.”

    BPI Rwanda is IFC’s fourth investment in a local investment fund managed by Business Partners International. To date, IFC has invested $5.0 million in BPI Kenya, $3.7 million in BPI Madagascar and $2 million in BPI Mozambique.
    The International Finance Corporation (IFC) promotes sustainable private sector investment in developing countries. IFC is a member of the World Bank Group and is headquartered in Washington, DC. It shares the primary objective of all World Bank Group institutions: to improve the quality of the lives of people in its developing member countries.

  • Kigali set to host Commonwealth Parliamentary Association forum

    {{Starting from 10-18 June Rwanda will host the Commonwealth Parliamentary Association Conference; the event will also see the country’s inauguration into the association. The event follows Rwanda’s approval into commonwealth nearly three years ago.}}

    The conference will attract 300 participants from the association’s 18 countries; other participants will come from East Africa Legislative Assembly (EALA) Southern African Development Community (SADC) and International Conference of the Great Lake Region (ICGLR).

    Among the main issues to be discussed include how to introduce genetically modified crops in Africa as a way of ensuring food security, the next agenda will focus on how to improve sustainable livelihood through poverty alleviation measures.

    In addition, the conference will address issues related to gender equality especially in land matters where some cultural practices have denied women the right to own property; democracy will also be at the core of the talks since it facilitates good governance and fair elections.

    Vincent Biruta, the Rwanda’s senate president, noted that the conference was timely given the country’s development progress. In this light, Biruta was optimistic that some participants might show interest towards Rwanda’s investment opportunities.

    Biruta further highlighted that the conference will be a success despite the fact that out of 18 African countries invited only three won’t attend, the absentees include Seychelles, Mauritius and Sierra Leone which has not yet confirmed their attendance.

    Rwanda’s parliamentarians in CPA total 95. These include 79 members of parliament and 16 Senators. The association’s objectives include; promotion of democracy and good governance, human rights and promotion of justice in Africa among others.

  • Government launches US$2m electric fence at Akagera park

    {{The government through Rwanda Development Board has commissioned a US$2m electrical fence that will cover the territorial boundaries of Akagera national park.
    }}

    The 2.5 metre-electric fence that is powered by solar energy will be supported by a metallic mesh intersected by three horizontal electrified wires and galvanised posts secured at short distances to endure high pressure and wind.

    John Gara, the Chief Executive Officer, RDB said that the construction is important because it will provide solution to the problem of wildlife animals that have been interfering with the activities of the population living near the park.

    “We are very pleased to be here today to start the fencing of the Akagera National Park. This is the beginning of the end of the human-wildlife conflicts at the boundaries of the park,” he said in a ceremony held at the park’s southern entrance of Nyankona in Kayonza district on Tuesday.

    “This will not only solve the problem of human-wildlife conflicts but it will also provide employment opportunities to the neighbouring population during the construction process and also thereafter in terms of maintaining the fence,” he added.

    The fencing also aims at addressing different problems linked to the close proximity of the park with the human population. These include direct damages, loss of property, poaching and other illegal activities in the park.

    In a bid to support the Akagera community conservation programme that links the park to the community, RDB donated a cheque worth Rwf 6M to 132 families of Kageyo cell, Mwili sector, Kayonza district. The money will also compensate property destroyed by the wildlife.

    “We recognised that the benefits from the park that we generally receive are to be shared between not only the general public but also the community projects of the population surrounding the park,” Gara pointed out.

    Executive Secretary of Mwili Sector, J.M.V Habyarimana noted that the community is optimistic that the money donated shall be used to buy seeds to cultivate crops in the destroyed farms.

    Rwanda’s construction company, Entreprise de Construction (EME) in partnership with a South African construction company were contracted to put up the fence.

  • Rwanda prefers use of IDs for regional travel

    {{Rwanda has said it prefers East Africans to use national identification cards when travelling in the region.
    }}

    The country’s minister for East African Community Affairs Ms Monique Mukaruliza said countries that had opted to use national IDs as travel documents should go ahead and formalise the procedure.

    “The EAC secretariat has to put in place a forum for those partner states which have agreed to use national IDs for the movement of their citizens across the region,” she said.

    Ms Mukaruliza made the plea in Kigali on Tuesday at a meeting with new EAC secretary general, Dr Richard Sezibera.

    The minister said free movement of people and labour would facilitate implementation of the EAC Common Market Protocol which came into force in July last year.

    Tanzania has objected to the use of national IDs as travel documents, insisting only passports and other internationally recognised travel documents should continue to be used.

    Rwanda is the only EAC state that has machine readable national identity cards while Uganda is reported to have started issuing its own.

  • Long-term loans a challenge to development financing in Africa- Central bank Governor

    {{Developing the economy can perform the traditional functions to undertake the responsibility of economic growth with stability on the African continent.
    }}

    The Governor of the National Bank of Rwanda Ambassador Claver Gatete elaborated that to accelerate the development of the least developed countries, challenges must be solved in advance. He made the remarks during the assembly of African central bank governors at the 34th ordinary seminar held in Kigali this week. The meeting, whose theme was Financing Development in Africa and the role of Central Banks, was organised by the Association of African Central Banks (AACB).

    “Long-term debt sustainability is difficult for African banks due to exterior conflicts on African continent”, Gatete said.

    The Executive Secretary of (AACB) Mr. Samuel MEANGO said that to meet the set target, which is tied to Africa’s relatively poor economic development,” is not to rely on foreign financial support only. He advised that countries should also ensure aid effectiveness and emphasise domestic resource mobilisation”.

    He further more said that encouraging savings through establishment of microfinance institutions and other non-bank financial institutions and creation of incentives for acquisition of financial assets could help African Banks to enhance domestic savings for higher investment. It is in this respect that the seminar sought to offer means which Africa can address its needs in financing development.

    The chairperson of the meeting Mrs.Monique Nsanzabaganwa who is the Deputy Governor of the National Bank of Rwanda, encouraged players in the financial sector to anticipate and advise in terms of proper policies like market development and enhancing policy and regulation that is prudent and flexible enough to accommodate the innovations.

    About the risks the banks are ready to take for the sake of development and how they can be measured, Nsanzabaganwa said that central bankers should reflect more and come up with strategies on how to develop the world market and how and where to invest local assets. Otehrs were the extent the partners and regulators should adopt technology like mobile banking and ICT and how to improve credit rating.

    She reiterated that Africa should use appropriate indicators to illustrate the continent’s position in the global economy. These include addressing the problem of corruption by strengthening anti-corruption institutions and effective and efficient implementation of development programmes, especially, those related to poverty reduction.

    The Association of African Central Banks was established to promote co-operation in the monetary, banking and financial spheres in Africa. The idea of AACB was first introduced on May 25, 1963, at the Summit Conference of African Heads of State and Government held in Addis Ababa, Ethiopia.

  • RDB: Leading from the front through reforms

    {{It is difficult to change the patterns of performance that have dominated society for ages, even more so when legal and institutional frameworks reinforce popular perceptions and the status quo. By reforming policies on paper, however, societies take one of the first steps in self-transformation. So it is with Rwanda.
    }}

    The act of reforming the business culture for several years now has helped break down one of the legal barriers to Rwanda’s fast economic growth. Before the reforms, the country had limited ways of representing its economic interests after the pungent 1994 genocide. 17 years after the genocide which defined modern world view of Rwanda, the citizens seem eager to paint a different picture in people’s minds – especially those of potential investors.

    Since the Doing Business reforms were enacted, Rwanda is on an upward trajectory. The country has gained recognition for being one of the safest and most transparent countries in Africa and a President who does all he can to court business leaders. The economic potential of the country is gaining attention. In fact, Rwanda was ranked in the top 20 global reformers in the Doing Business 2009 Report published by the World Bank.

    There are numerous sectors showing growth and promise – notably construction, agriculture, tourism, ICT and retail.

    Reforming business regulation takes leadership—more than many other reforms. Committed leaders as President Paul Kagame has often proved provide vision, energy and direction to improve business climates, often in the face of daunting challenges.

    As a follow up to the wide-ranging reforms introduced in May 2010, four fundamental reforms making it easier to start a business, deal with construction permits, register property, and trade across borders were put in place this year to enhance doing business in the country.
    In a media briefing in May 2011, the Chief Operations Officer of the Rwanda Development Board (RDB), Claire Akamanzi welcomed the reforms.

    “The 2011 Doing Business results are a statement of our consistent efforts to empower our local and foreign entrepreneurs. We are determined to work alongside investors to make sure we do all we can to make Rwanda a great place to do business and unleash the country’s full potential, therefore we are relentless in ensuring continuous reforms like these ones”

    “The new reforms will be reason for improving Rwanda’s position in the World Bank’s Doing Business ranking.”

    {{Starting a business}}
    On starting a business, free online registration was introduced. Those who register in person, the registration fees have been reduced from Rwf 25,000 to Rwf 15,000.

    “The reason we reduced it is because we want more in the informal sector to become formalised,” she said during a press briefing to announce the reforms.

    “More than 30 percent of our companies are SMEs and we want to encourage them to move away from informal businesses. We are making it easy for them”.

    {{Registering property}}
    On registering property, several requirements were eliminated and are now optional.

    Notarisation of a sale agreement is eliminated. Instead, the signature of a sale agreement can be done at the registry upon submission.
    Dr. Emmanuel Nkurunziza, the director general of the National Land Centre says: “What we are trying to do is make this requirement optional, particularly for commercial and industrial developers.”

    “We can exempt them from that but we make sure they sign their agreements before the registrar or deputy registrar when they submit their application for transfer of property.”

    A tax clearance certificate is also no longer required from a client. Instead, Rwanda Revenue Authority (RRA) will coordinate with the National Land Centre to provide information on clients’ tax status.

    {{Construction permits}}
    When it comes to dealing with construction permits, several application procedures were merged from 14 to only six, relieving clients of interaction with utility providers.

    In a single application, a client can now apply for a construction permit, water connection, electricity and telephone. Inspections and invoices will also be issued simultaneously.

    {{Cross-border trade}}
    On trade across borders, only three out of eight documents necessary for customs declaration are needed. The three documents are the commercial invoice, the parking list, and the bill of landing or airway bill.

    Those rendered optional include a certificate of origin, health certificate, transit cargo document, terminal handling receipt, and import license.
    Peter Gapira, the Operations Manager of the Gorilla 1000 clearing agency that operates from Kigali International Airport and Gikondo expresses his gratitude about reforms in the cross-border trade.

    “There has been a long process in import and export declaration, where goods would spend a long time in the warehouse and this drew complaints from investors and other business stakeholders,” Gapira said.

    He highlights additional trade facilitating mechanisms pioneered by the Rwanda Revenue Authority (RRA), “like Blue Channel, where an importer is allowed to offload goods from his premises instead of offloading from the warehouse which involves other charges and processes.”

    “There is another called pre-clearance, where taxes are paid when goods have not yet entered the country’s borders, and when they come, they directly go to the importer’s premises.

    This also reduces the processes and other charges,” Gapira observes. He further commends the 24-hour border operations and use of scanners in warehouses and at border posts.

    The Business Manager of a private equity company Fusion Capital Ltd says of the reforms: “As a financier, the reforms announced by RDB will greatly improve business.”

    “Reduced procedures and documentation required for construction permits and import /export requirements will encourage more small and medium scale players,” Kageenu said.

    “Improvements in the foreclosure process is also highly welcome.
    In addition to helping financial institutions to fast liquidate securities held for non performing facilities, it will help build a more disciplined repayment culture with borrowers,” she adds.

    According to RDB, the latest reforms underline the importance of cooperation between government institutions and agencies to overcome the constraints facing Rwanda’s private sector. For four years in a row, Rwanda has consistently registered impressive performance and this has helped it maintain its position as one of the easiest places to do business in Africa.

    The Rwanda Development Board says it shall continue to foster existing partnerships, and build new ones among different doing business stakeholders and agencies ensure that business is at the heart of our development.

    Gross domestic product expanded by an average of six percent a year during the last decade. With an expanding private sector and a new stock exchange since February 2008, the need for an efficient commercial dispute resolution will only grow.

    The ancient Roman quote from Marcus Tullius Cicero still holds true: “To those who are engaged in commercial dealings, justice is indispensable to the conduct of business.”

    Admittedly, reforming laws and regulations on paper does not automatically entail shifts in public opinion. However, when the Rwandan public and foreigners have the space to represent and advocate their entrepreneurial interests, they can show their economic potential. The reforms have since given investors this space.

    Karim Tushabe, a legal consultant at the doing business unit of RDB says that since 1934, the Rwandan law had not yet been changed and since many of the Rwandan business are now competing on an internationally modernised level the laws too must be modernised in order to work in harmony.

    Tushabe talks of the insolvency law and its importance. “For example, Rwandatel is now using this insolvency law to rebuild its business, how so? This law allows a business the opportunity to either reorganise or shut down their companies if they are unable to meet their debt.

    Whereas before, they were no checking of poorly performing companies that were previously operating without clear rules and procedures”
    “The new secured transaction law enables the transactions of loans to be broader than traditional loans whereby a house or land would have been considered security, but now even inventories, agricultural produce, even cars can be considered by law as collateral”

    Mr. Charles Kaliwabo, the spokesperson of the Supreme Court says. “Laws have to change and our judges must be prepared to be able to carry out these laws in accordance with those we may do business with one day.”

    Kaliwabo says there is an ongoing project to update the amategeko.net website around July to exhibit all new commercial laws.
    Deputy Chief Justice Prof. Sam Rugege says that Rwanda has carried out major reforms in business laws for the last six years in a bid to make them up-to-date.

    “The reform of business laws has been ongoing for six years now, producing around new 20 laws published between 2008 and 2010,”
    “They form a large volume of legal text to go through, later on master. Since they are new and in many cases involve new concepts which were not part of the existing legal system, it has not been easy to get to grips with them,” Rugege says.

    “The Judiciary must participate fully and play its role efficiently in the national effort to create an environment conducive to investment, both local and external, so that Rwanda can reach its Vision 2020 targets and improve the quality of life among our citizens,” he points out.

    According to Lucy Mamganga Fye, the Senior Private Sector Development Specialist at the World Bank, the major reforms Rwanda has embarked on especially in the legal area of doing business have put the country on course to build a private sector which will become the main pillar of the economy.

    She says that the reforms which have been implemented have for two consecutive years put Rwanda among the top business reformers under the World Bank Doing Business Report.

    In 2011’s index, Rwanda was the most improved country in Africa – the second most improved country overall. It came in 58th in the world on the overall list, up from 70th last year.

    Rwanda is also the fourth easiest place to business in Africa after Mauritius, South Africa, and Botswana. In the East African region, Rwanda ranks the easiest place to do business according to the World Bank report.

    Over the last years Rwanda has won praise for its vision and lack of corruption.

  • Korean consumer electronics giant opens shop in Rwanda

    {{Samsung Electronics, South Korea’s consumer electronics manufacturer has opened shop in Rwanda to ease access to its genuine products in the country.
    }}

    The shop, which is opposite Union Trade Centre (UTC); a commercial
    complex in the heart of the capital Kigali will ease access to the
    firm’s genuine products, an official has said.

    Samsung Electronics Africa Chief Operating Officer (COO) Mr. George
    Ferreira said in an interview in Kenya’s capital Nairobi recently that
    the shop would improve distribution of Samsung products in Rwanda.

    By opening in Kigali, Samsung hopes to see more of its original
    products capture the market thus kicking out fake products branded
    Samsung.

    This is expected to increase customer satisfaction, an ingredient that
    Samsung uses to retain its customers.

    The shop showcases a range of Samsung products including the most
    popular ones—refrigerators, mobile handsets, computers, and television
    screens.

    The opening of Samsung in Kigali follows entry of rivals LG
    Electronics, Hewlett Packard (HP) and Nokia. LG is also a South Korean based
    firm.

    The LG shop is situated on airport Avenue in Giporoso, Remera in Kigali
    City but the firm’s products can mostly be found in most Indian-owned
    electronics shops in the country.

    Like Samsung, LG is also selling electronics products including mobile
    phones, home appliances like refrigerators, television screens and
    computers.

    HP and Nokia use local distributors to supply their products.

    The two Asian firms—LG and Samsung are strong competitors back in
    Korea but Samsung is three times bigger than LG, according to Mr.
    Ferreira.

    LG has been operating in Africa for more than a decade while Samsung
    has only been in the continent at least one year.

    Although the two firms are aggressively penetrating the Rwandan mobile market, they are facing tough competition from Finnish firm Nokia.

    Nokia has a bigger market share in Rwanda especially in the mobile phone segment.

    In the computer and its accessories market, HP dominates the Rwandan market. On TV sets and other home appliances, Samsung and LG are targeting new markets in Africa, but Samsung says it wants to grow Africa market and beat all the other Consumer Electronics makers by 2015.

    The firm says it will invest around USD140 million in five years and
    increase sales revenue from USD1.2 billion last year to $10
    billion by 2015 in Africa only.

    Samsung is currently operating in more than 30 African countries
    including Rwanda’s neighbors Burundi, Uganda, and
    Tanzania. It has East Africa regional offices in Kenya, Nairobi.

    Last month, the firm held a forum for its Africa partners in an event
    that took place in Nairobi. At the same time, Samsung displayed its latest products ranging from Google’s Android (operating system) powered mobile phones and touch screen computers.

  • Female hawkers to form co-ops to boost incomes

    {{Women hawkers in the streets of Kigali will soon boost their income levels after authorities advised them to join cooperatives to access financial services.
    }}

    The president of the national women council, Tengera Francesca, is buoyant that the effort to organise women street vendors into cooperatives and empower them is one way to enhance the business
    sector.

    “I know you are not poor as you always run up down and think that your hopes ends from there and that is why today we are here to implement knowledge which is missing.”
    Tengera also noted that the cooperatives will help women to shun illicit business and target bigger businesses.

    “We want to organise women who are in petty business to come together into cooperatives,” she said,
    She also noted that hundreds of street vendors, mainly women usually flock in Kigali streets during evening hours.

    This workshop organised by the national women council in partnership with Rwanda Cooperative Alliance is sensitising almost 321 women from Kigali on how they come together in cooperatives to expand their
    business.

    Audace Bimenyimana, the officer in charge curriculum development in the capacity building unit at RCA said that women are able to earn a lot from their meagre capital if they come together in cooperatives.

    “By working together, these women have the advantage of earning a lot from their savings and build bigger businesses and they will be able to employ other people,” he said.

    Genevieve Mukeshimana a mother of 4 who is a street vendor dealing in vegetables says she is optimistic that this effort will improve their business perceptions thus better incomes.

    “I am always up and down fighting with the local security, but when the officials from our nyarugenge district called us to come for training I did not refuse because I believed after this workshop I am
    going to through away (agataro).”

    The mayor Nyarugenge Solange Mukasonga said that the government has already prepared minimarkets where female hawkers will be allocated to carry out their businesses on an expansive basis.

    “We have started construction of two more selling points in Mageragere and Kanyinya. This will help many of these women to get a place,” she said, noting that the markets will help women to expand businesses after acquiring credit.

  • RSE market highlights as of June 1 2011

    {{The Rwanda Stock Exchange today registered low volumes of transactions compared to yesterdays’ trading and a total turnover of 2’921’000 Rfw was recorded from the sale of 12’700 shares of Bralirwa traded in 4 transactions.
    }}

    The price of Bralirwa shares closed at Rfw 230, which has been constant over the past one week. At the close of trading session, there was an outstanding offer of 30’000 Bralirwa shares at 240 Rfw. There were was no bid.

    The KCB and NMG counters did not record any activity. The KCB and NMG share prices remained unchanged from the yesterday’s closing prices of Rwf 175 and Rwf 1200 respectively.

    Bralirwa shares go ex- dividend on 13th of June 2011 and NMG shares are trading ex -dividend effective today 1st of June 2011.

  • Health ministry wants more private sector involvement

    {{The ministry of health and the private sector are working on a framework to enhance collaboration from both parties with the aim of facilitating better healthcare.
    }}

    Though the private sector has contributed to improvement in health activities, the Health Minister Agnes Binagwaho argues more needs to be done to provide health services especially in rural areas.

    She further assured support to the private sector adding that if they for instance put up hospitals, the government would provide them healthcare personnel. “We have to ensure that there is quality healthcare provision within the public as well as the private sector.”

    Jean Nyirinkwaya, the president of the private medical association highlighted that they too have the will do more towards extending better health services to Rwandans. “We’re meeting to find ways of enhancing a relationship between the Ministry Of Health and us and we hope to come with a framework that would confront challenges such as
    manpower and equipment,” he remarked.