EASE OF DOING BUSINESS
Moving up the ladder
By Bindesh Pandey *
What comes to your mind when you hear“ Italy” and“ Rwanda”? Chances are with Italy, you’ d have imagined classic European architecture, a progressive nation, and happy people; and with Rwanda, you’ d have thought of some malnourished people in Africa, violence, and wildlife. Unfortunately in this information age when everything we want to know is just a click away, we still have some strong pre-conceived notions.
Just to put it into context, as per recent rankings released by the World Bank on ease of doing business, Rwanda is ranked 41st, while Italy is 46th, Belgium is 52nd, and Luxembourg is 63rd. These rankings speak volumes about Rwanda and the efforts being made by the Rwandan government to transform the country.
Rankings, the critics say, are often perception based. But there is enough credible data around to suggest this growth is for real: since 2000, Rwanda has experienced remarkable economic growth, with the Gross Domestic Product( GDP) rising from $ 1.7bn in 2000 to $ 8.4bn in 2016. And if we dig deeper, there is a very clear method to the madness. Rwanda has been consistent in its focus on education and building a knowledge-based economy. Education enables you to produce enough employable resources who then contribute to improve their own economic standards as well as boost the economy. Reduction in poverty and GDP growth rate data is a clear indication that the efforts invested by the Rwandan government in education are producing the right results.
This cannot be achieved if you do not have a conducive environment for economic growth. For instance – in getting access to credit( which is a critical aspect for businesses to flourish),
Rwanda is ranked 6th worldwide. It provides a great impetus to both small and large businesses to invest, and supplemented by the stable political environment of Rwanda, they can be confident about consistency in policies and accordingly plan and execute their business strategies. Another indicator of reforms at work is the open visa policy. Not many know that Rwanda allows visa on arrival for citizens of ALL countries. I’ ve travelled extensively for business and hence can safely state that a friendly visa regime is something we always aspire for in countries where we want to do business.
Rwanda is a shining star for Africa and the world at large, however, there are still many more avenues which the country needs to address. While access to credit is great, it is equally important to protect the interest’ of lenders. That’ s where t he country’ s insolvency procedures should be improved. At present, Rwanda is ranked 78th as far as resolving insolvency is considered. There is significant room for improvement there.
In summary, all the leading indicators, data on the ground and firsthand experience of those who have done business in Rwanda confirm that Rwanda is on the right path and in many instances a wonderful example for rest of the emerging economies to follow. As long as the country maintains its focus and consistency in policies, there is no reason why it cannot sustain the growth it has had in the past few years. So, no surprises on seeing the rankings but, as they say, there are miles to go before I sleep. Keep walking, Rwanda! •
* The author is Business Head( Africa) with Newgen Software
16 • RWANDA • 2018