Doing Business Report: Beyond reform to tangible results

The Doing Business Report rated Rwanda the best reformer in its report last year and we ranked 57th. it was a major step forward for Rwanda. The 2010 report is due on 4th November and Rwanda should rank well and maintain its good position in the realm of business reform. However, most strategists in government are now looking beyond the key performance indicators to solid results, an indicator is just an indicator, solid results are solid results. The world of reform offers a springboard to greater things but it is not the end result. when you think about it America or Britain have little need for reform; they have decades of best practice that have cemented their position. Rwanda is now looking to consolidate on these reforms, to ensure compliance and expand its tax base as well as investment. Sometimes reform can just stay on paper, or old practices can persist on the ground level and it often requires scrutiny to make sure these reforms are real. There will also be a bedding down process as these reforms become engrained in work practices, the new commercial law also needs to be locally redefined and interpreted. Many of our early gains were from procedural changes, streamlining processes, cutting red-tape and that was commendable but here comes the hard part. The next set of reforms require a longer more sustained approach, for example now business people want reforms to the tax code or more access to credit and that will take time. Another institutional change is the PPD (Public Private Dialogue) a new forum for government and business to work together in devising and strategising new policy specific to Rwanda. There is also a change in focus towards building the foundation of any economy, the small to medium sized entreprise (SME) the large companies are only a fraction of the economy as a whole. The SME’s will never reach their potential unless our banking system is overhauled and made more business-friendly, right now they are providing limited benefit to the SME apart from deposit and withdrawal. So when the Doing Business Report comes next week, expect Rwanda to do well but we should not be complacent. Compliance is the key, if there is a compliance index then we need to top that in order to do our reforms justice. Many nations just reform then stagnate, reform is easy but the real hurdle is compliance and reappraisal. Now that we have got the right indicators we need more solid gains. Soon we will measure ourselves on the tangibles, tax base, tax revenue, employment numbers, start-up companies registered, new tax-payers registered, interest rates, foreclosures, mortgage rates, just like developed countries. Ends