The private sector is upbeat on the recent ranking of Kigali as one of the top six cities in the world that demonstrate global competitiveness by a World Bank report.

The report, released on Monday, examined the key dimensions of globally competitive cities after putting together a collection of detailed economic data for over 750 cities in the world.

Upon scrutinising the factors that drive economic competitiveness, Kigali emerged among the top six cities and the only one in the sub-Saharan Africa region.

Others on the list were Bucaramanga in Colombia, Coimbatore in India, Changsha in China, Gaziantep in Turkey, and Tangier in Morocco.

The report defined a competitive city as one that successfully facilitates its firms and industries to grow jobs, raises productivity and increases incomes of citizens.

It classified improvement of competitiveness of cities as a pathway to eradicate poverty and increase shared prosperity.

Members of the Rwandan private sector operating in various sectors told The New Times that the ranking was a huge endorsement of efforts to promote the city as a top investment destination.

Among the impacts they predict will stem from the developments is increased confidence by international investors looking to establish presence in the region.

City businessman Dennis Karera, who is chairperson of the East African Business Council, told The New Times that the ranking will go a long way in increasing the attractiveness of capital for foreign firms.

Karera said, as a competitive capital, investor confidence in Kigali in multiple sectors, including money markets and in the finance sector, had increased.

These are some of the indicators and indexes that investors consider when putting their money in an economy, he said.

Consequently, the entrance of international investors will also increase the partnership opportunities for local firms in various sectors.

Timely ranking

Karera, who is involved in several sectors, including real estate and hospitality, said the ranking, coming at a time when the country was embracing regional integration, could propel Kigali to a hub for regional enterprises.

"Rwanda is in the process of regional integration through the Northern Corridor Integration Projects Initiative and East African Community in general. Kigali’s competitiveness is likely to see enterprises here spread out to other countries as well as regional firms coming here,” he said.

Despite its size, Kigali beat bigger cities across the world, a development Karera said demonstrated the efficiency of the Rwandan capital in provision of services and in facilitating the business operations.

"Most of the top business cities across the world are actually small cities, for Kigali it is mainly the work done in terms of boosting the business environment that raises its international profile,” Karera said.

Way forward?

Going forward, he said, the city should seek to compete not with peers in the region but with top cities in the world such as Amsterdam, Brussels and Dubai, among others, to further raise its global standing as far as attracting investments is concerned.

Among the factors that propelled Kigali to the favourable position was the prioritisation of the provision of basic enabling infrastructure and services needed to attract and retain investment and to promote business formation and growth.

These include putting in place institutions and regulations such as a one-stop centre that targets obstacles faced by foreign investors in the process of establishing a presence in the country.

The business community umbrella body, Private Sector Federation (PSF), is already making the most of the services and provisions that are behind Kigali’s competitiveness.

Stephen Ruzibiza, the PSF chief executive, said the federation was a huge beneficiary of increased efficiency and the enabling environment created by city authorities and the government.

He said the private sector was also responsible for some of the services and infrastructure development available that was being credited for the improved competitiveness.

"Some of the services and infrastructure developments are private sector-owned and driven,” Ruzibiza said.

Noting that the ranking and the environment was an incentive for business establishment and growth, Ruzibiza said, going forward, PSF would capitalise on the improved competitiveness to make further gains.

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Why Rwanda ranked well

The World Bank report commended the putting in place of institutions and regulations such as one-stop centre to ease doing business for foreign investors and attract more investments for tipping the scale in Kigali’s competitiveness.

This was done by creating Kigali Investors’ Forum, a private sector forum, to collaborate with government to identify specific reforms by city leaders.

Authorities at the City of Kigali identified constraints using a Doing Business assessment and through the Kigali Investors Forum, to help tackle inefficiency and lack of inter-agency coordination on construction permits.

To address the challenges identified, the report notes that the city established a one-stop centre in 2010 that brought together all agencies needed to approve construction permits.

The City further created an electronic platform for construction permits with support from the International Finance Corporation and African Development Bank to further reduce red tape.

As a result, the approval processes of permits were streamlined and permits are issued in not more than 30 days.

"The city is now 34th worldwide in dealing with construction permits, according to Doing Business surveys,” the report noted.

editorial@newtimes.co.rw