Government is luring the Rwandans in Diaspora to invest at home, through the capital market.

Consollat Rusagara, the vice governor of BNR said that inflows from abroad have increased significantly since 2003, from $2.7 million about (Frw1.8 billion) to $68 million (about Frw37 billion) last year.

Rusagara said these are estimated figures which reflect money through bank transfers and money transfer companies like Moneygram.

The reason for estimating, according to the vice governor, is because some statistics on inflows from foreign direct investment (FDI), exports, grants to government for budget support have to be eliminated.

The implication is that; there are other inflows that go unrecorded.

The increase of these inward remittances has been largely attributed to the growing competition in the banking sector.

Rusagara said banks have tried to ease account opening procedures for savings in form of inward remittances. Banks have also tried to publish their tariffs to prove their transparency.

Like the vice governor said these inflows have had positive impacts like stabilising the Rwandan Franc and improving on the balance of payment, they could play another major role of developing the capital market in Rwanda.

Commercial Bank of Rwanda (BCR) issued a corporate bond to raise funds worth $5m about Frw2.8 billion for investing in the housing industry. This is twelve times less than what the inflows from abroad—last year. If we had many companies willing to offer their securities at CMAC especially equity in order to raise long term funds, then Rwandans in Diaspora can make a very big contribution.

Stanbic Bank Uganda (SBU) made an initial public offer of 20 per cent shares to raise Ush70 billion about Frw23.3 billion but most of the money came from Ugandans in Diaspora.

It is known that much of the Diaspora money is invested in houses, trucks and other long term assets.

But so many have previously lost money sent for investments in such assets like real estate.

Besides, some individuals in Diaspora send money for relatives just for consumption purposes.

This is therefore a challenge to CMAC to attract these inflows. Celestin Rwabukumba the operations manager of CMAC said they are already interesting the Diaspora about the savings and investment opportunities at the capital market.

"We have prepared press releases and sent them to the ministry of foreign affairs to send them to embassies," he said.

He said they have communicated to some individuals in North America about forming collective investment schemes.

This is a positive move for CMAC, but management must create confidence by educating potential investors in Diaspora.

Japheth Katto, the chief executive officer of the Capital Markets Authority in Uganda says: "an investor who is aware is an investor who is protected."

Dr James Ndahiro a board member of CMAC says transparency can be created by adhering to the rules that have been put in place by CMAC thus creating investor confidence.

Thefore the launching of the Rwanda capital market was a milestone achievement in the financial sector development in Rwanda.

As a result of the capital market, François Kanimba, the governor of the National Bank of Rwanda (BNR) said that competitiveness in the financial system is expected to improve.

He adds that this will reduce the current gap spread between the lending and deposit rates in the banking system.

While we are looking forward to exploiting the opportunities of this new financial infrastructure, the Capital Markets Advisory Council (CMAC) must do all it can to attract more actors, savers and investors on this market.

In respect many initiatives have been taken and continue to be taken by government to encourage individuals, groups, organisations and the private sector to save and invest for national development.

Much focus, however, has been placed on the Rwandans or individuals considered as residents of Rwanda.

This is evident by the fact that the Treasury bonds on the Rwanda Over The Counter (OTC) Market are only open to these persons.

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