Despite Rwanda’s relatively good performance as showcased in the latest World Bank Doing Business Report, government has expressed concerns over the methodology used in compiling the report.

The concerns were raised at a meeting convened last week by Rwanda Development Board chief executive Francis Gatare and the Minister for Trade and Industry, Francois Kanimba.

The meeting was also attended by Dr Rita Ramalho, the manager of the World Bank Doing Business report.

Some of the concerns expressed on the report, released last month, included the unpredictability of the changes in methodology and the expansion of indicators without prior notification of the countries that subscribe to the report.

Another issue that was pointed out was that of drawing unfair comparisons of developing countries against developed nations using measures associated with the income of a country, which predetermines the outcome.

Gatare said their disagreements with the influential report were not a concern specific to Rwanda, but all developing economies.

"When you put a measure associated with the income of a country, already the outcome will be predetermined. It is those types of measurements that we expressed disagreement with,” he said.

Regarding the unpredictability of the changes made, Gatare said for the report to be relevant to countries subscribing to it, it is important to ensure that stakeholders were aware of such developments.

"This report is important not only to the World Bank Group, but also to the countries that participate in it. Some of the complaints we have are associated with the predictability of the expansion of the indicators so that everyone is on board on what is to be expected going forward. For the report to be relevant, it has to be seen to be fair,” Gatare said.

There was also a discussion about data collection, gathering and use, he said.

Gatare said the report mostly depended on data gathered from interviews with members of the private sector some of whom were not aware of the new systems introduced by government to facilitate the doing business environment.

An example, Gatare noted, was the filing of tax returns where Rwanda Revenue Authority has since introduced electronic systems of filing tax but a significant size of the private sector operators still prefer to do it manually.

Despite Rwanda’s concerns, however, the country ranked favourably in the report under the theme, "Measuring regulatory quality and efficiency.”

The report evaluated the doing business environments in 189 countries around the world. Rwanda was placed second in the continent behind Mauritius, and 62nd on the globe.

The country also retained its position as the easiest place to do business in East Africa while East Africa’s largest economy, Kenya, is ranked (108) Uganda (122), Tanzania (139), while Burundi is placed in 152nd position.

Economy growing

The report showed that Rwanda’s economy continues to compete favourably with major economies in certain indicators such as getting credit where the country is ranked in joint second with the US and Colombia, behind New Zealand.

On the ease to getting credit, there was an improvement by two steps for Rwanda, which was placed in fourth position globally in last year’s report.

In defence of the report and the changes in methodology, Romalho said it was not uncommon for countries to air out their disagreements with the results and that they always hold talks with concerned economies to address any contentious issues that might arise.

She said the changes in methodology had no intentions of disrupting ranking but to increase the relevance of the report in the fast changing global business climate.

"The issue of having disagreements or different views on different indicators, is not uncommon. We have this type of discussions with the majority of the countries that we rank. We have a lot of discussion with countries around the world on issues they agree and disagree with. We do that with about 100 out of 189 countries,” Romalho said.

The manager of the World Bank Doing Business report said in the process of gathering data they consult people on ground to find out the extent to which an indicator has been implemented.

Depending on the indicator, they reach out to experts in that field to get informed opinions.

Doing business tries to reflect the private sector experience, though we received comments from the government, Romalho added.

"Normally when there are disagreements and differences between us and the government, it is mostly because the private sector has a different view. Another one could be because of misunderstanding of the methodology,” she said.

Minister Kanimba said Rwanda would continue to improve the business environment as well as consider recommendations from the World Bank.

Among the strategies to move forward, Kanimba said, the government will continue to entrench the application of information and telecommunication technology to boost the business climate as well as to offer better public services.

The report continues to be a major reference document for investors who are constantly on the lookout for places with best environments for their investment.

editorial@newtimes.co.rw