Francis Gatare, the director general Rwanda Investment and Export Promotions Agency is upbeat that his agency has done well in mobilising investors in the country. As of Friday last week, investments valued at Frw237 billion had been attracted to Rwanda. This year the service sector has attracted more investors, investment capital and created more jobs . This means this year’s success story could hasten the country’s transition to a middle-income country by 2020.In appreciation, Riepa gave out symbolic certificates to investors and signed performance contracts with them. “The charter is a promise to investors that these are services we are to deliver,” Gatare said on phone.Riepa has cause to celebrate. The organisation has grown a lot by promoting investment and facilitating business development and promotion of exports. It has also participated fully in organising visa arrangements and preparation of the law governing exports under AGOA.This institution has been in existence for the past seven years, and it has registered remarkable achievements. Claire Akamanzi, the Riepa deputy director general is very optimistic: “Our need to attract investments is critical to achieving Vision 2020 targets.”Vision 2020 is the ambitious programme by the government of Rwanda to raise the economy of Rwanda to middle income level, increasing the percentage of investments. Akamanzi says Riepa’s strategy lies in exploiting what makes Rwanda unique, which is a very reliable strategy like zero tolerance to corruption, a very peaceful and secure environment. She adds, “We are branding Rwanda as a country with certain values: integrity, efficiency, hard-working people. Rwanda has some substantial assets: peace and security in the entire country. You can leave your car outside and it won’t get vandalised.” Riepa’s managers are not perturbed by the physical limitations of the country being landlocked, or being devoid of natural resources. They insist, “it is a blessing placing investors at the intersection of French- and English-speaking Africa and affording new opportunities for trade in ‘high-value, low-volume, transport-insensitive’ products like flowers and fruits.” In the same vein, investments have began trickling in - the latest entrants being Africa’s leading equity and commercial banks opening up regional offices in Rwanda. The banks entering Rwanda’s financial market lately include Ecobank, Access Bank, and Barclays Bank is expected soon.“We want to distinguish ourselves in regard to regional integration - having a perfect location with access to East and Central African markets,” says Akamanzi. Textile industryRwanda is AGOA-eligible since 2001, including textile and apparel benefits, which Usine de Textiles du Rwanda (Utexrwa), the only textile factory in the country has taken advantage of. Rwandan exporters can export apparel made from fabric produced in the US or those produced in Rwanda. Utexrwa is today a growing textile mill with in-house garment manufacturing facilities. It is spread over an area of six hectares with build-up construction of over 23,500 sq. meters, modern machinery of 5,472 spindles; it has a capacity of 1 million kilogrammes of yarn per annum. Currently, Utexrwa employs 696 fulltime workers and from time to time it can employ up to 400 part time employees. Experts say this company has one of the best garment infrastructures in sub-Saharan African countries. Utexrwa has already established contact with US partners like Wall-Mart Stores. However, it is constrained with its low production capacity, the high cost of imported input and energy. AgricultureHowever, Riepa has a daunting task expanding the agricultural sector which is responsible for a big proportion of Rwandan exports. The country has a rural based economy with about 90 percent of the population engaged in subsistence agriculture. Her main export products are tea and coffee which account for more than 80 percent of the total export revenues. “We are encouraging growth of flowers and other products like fruits and vegetables so as to balance the delicate nature of horticulture. We are working with Ministry of Agriculture, Rada, to look for ideas of diversifying agricultural production and value addition. We are also in talks with a major horticulture investor; this will go a long way in improving the farming sector.”Branding Rwanda The job of attracting investors to Rwanda has not been left to Riepa alone; diplomats and tourists are tasked to market and brand Rwanda to the international community. The brand-building goes all the way to the top. President Paul Kagame has been at the forefront of this objective – on his trips to China, UK and US – talking to entrepreneurs to invest in Rwanda. This has not only increased foreign direct investment of the economy but has also increased employment opportunities for Rwandans.Barriers to regional exports are of particular concern, given that the core market for growth will be the 60 million consumers in Rwanda’s immediate environs – those in the Common Market for Eastern and Southern Africa and the East African Community and EAC.Akamanzi says this should not be a problem in the long run.“Our strategy is to become a regional investment hub. So we have joined EAC, Comesa, and CEPEGL. We also want to build our infrastructure to make it easy for the export of goods.”To make these policies practical, Riepa and the ministry of Commerce want to utilise the Free Trade Zones to increase exports.The Free Trade Zone on the outskirts of Kigali has been leased to a private company to speed up the construction of factories and firms meant to serve the region. But Riepa’s work – being a one-stop centre for investors - has been disputed by the World Bank’s Doing Business reports which positions Rwanda at 158 out of 175 in terms of setting up investments. Akamanzi says, “The World Bank uses certain criteria in determining the conditions of investing which are blanket, yet Rwanda has no control over some of these conditions - for example transporting from Mombassa or Dar-es-Salaam. This is not helped by the fact that many businesses are not registered with Riepa. The World Bank did not consider these dynamics because they look only at the worst-case scenario.” However, Riepa is working to rectify the major issues raised by the World Bank, admits Akamanzi.“This year we have revised our operations; we sent an Action Plan document to cabinet. I believe we shall base on the proposals we forwarded to cabinet.”She also says Riepa is undertaking several reforms which will improve the performance of the business sector in the country.“As part of these reforms we are introducing the business registry agency to speed up the process of business documentation.”The diaspora’s confidence is returning but domestic investment needs to be expanded more, with savings standing at 3 percent of Gross Domestic Product (GDP), while 90 per cent of the population that is engaged in subsistence agriculture continues to be considered “unbankable”, even by microfinance lenders. “Our intervention to attract investments from the Diaspora is just beginning; we have sponsored meetings of Rwandans in Diaspora, we recognise we could have them forming investment groups and we offer advisory services. We need to encourage them to send their remittances, because they are essential to expanding the economies of several sectors as examples in Uganda and Mexico indicate,” concludes Akamanzi.The challenge for the architects of Brand Rwanda is to prove that the investment climate they are crafting can sustain serious investment in infrastructure, agriculture, energy and tourism while improving the lot of the majority of Rwandans living in precarious subsistence. The brand-building goes all the way to the top. President Paul Kagame has been at the forefront of this objective – on his trips to China, UK and US – talking to entrepreneurs to invest in Rwanda. This has not only increased foreign direct investment of the economy but has also increased employment opportunities for Rwandans.Barriers to regional exports are of particular concern, given that the core market for growth will be the 60 million consumers in Rwanda’s immediate environs – those in the Common Market for Eastern and Southern Africa and the East African Community and EAC.Akamanzi says this should not be a problem in the long run.“Our strategy is to become a regional investment hub. So we have joined EAC, Comesa, and CEPEGL. We also want to build our infrastructure to make it easy for the export of goods.”To make these policies practical, Riepa and the ministry of Commerce want to utilise the Free Trade Zones to increase exports.The Free Trade Zone on the outskirts of Kigali has been leased to a private company to speed up the construction of factories and firms meant to serve the region.But Riepa’s work – being a one-stop centre for investors - has been disputed by the World Bank’s Doing Business reports which positions Rwanda at 158 out of 175 in terms of setting up investments. Akamanzi says, “The World Bank uses certain criteria in determining the conditions of investing which are blanket, yet Rwanda has no control over some of these conditions - for example transporting from Mombassa or Dar-es-Salaam. This is not helped by the fact that many businesses are not registered with Riepa. The World Bank did not consider these dynamics because they look only at the worst-case scenario.”However, Riepa is working to rectify the major issues raised by the World Bank, admits Akamanzi.“This year we have revised our operations; we sent an Action Plan document to cabinet. I believe we shall base on the proposals we forwarded to cabinet.”She also says Riepa is undertaking several reforms which will improve the performance of the business sector in the country.“As part of these reforms we are introducing the business registry agency to speed up the process of business documentation.”The diaspora’s confidence is returning but domestic investment needs to be expanded more, with savings standing at 3 percent of Gross Domestic Product (GDP), while 90 per cent of the population that is engaged in subsistence agriculture continues to be considered “unbankable”, even by microfinance lenders. “Our intervention to attract investments from the Diaspora is just beginning; we have sponsored meetings of Rwandans in Diaspora, we recognise we could have them forming investment groups and we offer advisory services. We need to encourage them to send their remittances, because they are essential to expanding the economies of several sectors as examples in Uganda and Mexico indicate,” concludes Akamanzi.The challenge for the architects of Brand Rwanda is to prove that the investment climate they are crafting can sustain serious investment in infrastructure, agriculture, energy and tourism while improving the lot of the majority of Rwandans living in precarious subsistence.Ends
