RWANDA

  • September 7, 2016

Rwanda is commonly presented as the tiny east-central African country, and commonly known for its historic tragedy and the 1994 Genocide against Tutsi.

Rwanda is only small in size; the country is large in ambition, shared vision and achievements in economic, politic and social development.

The Economy at a Glance

Rwanda is a resilient, forward looking country with a vision to elevate to a middle income, service and knowledge based economy by 2020.

Key achievements during this period include:

Growing the economy at an average GDP of 8% pa and we aim at achieving 11.5% from 2012 – 2017.

There was a tremendous growth of the GDP, $644 per capita in 2012, a 3 fold increase from 2000. Our GDP target is $1,240 by 2017.

Rwanda’s strong performance is largely driven by the expansion of the service sector. The sector contributes about 45% of GDP compared to 33% and 16%contribute by agriculture and industrial sectors respectively.

Inflation in Rwanda has declined since 2008, due to improved domestic food production, management of fiscal and monetary policies.

Fitch Ratings Ltd, upgraded Rwanda’s Credit Outlook and placed it at Citing strong economic growth over the past years and prospects for stronger growth.

The above economic achievements have made Rwanda to be ranked the most competitive place to do business in East Africa and 3rd in Africa (Global competitive Index Report 2013 – 2014

Sectoral Profile Infrastructure

Rail, air, logistics investment opportunities abound to develop Rwanda as an EAC hub.

Roads

Roads represent 90% of transportation in the country.

Over 14,000 km (8,700 miles) of roads, ~95.6% of the national paved roads in good condition.

Regional hub for road transport as it connects important regional players, from the East coast of Africa to the west coast.

Rail

A new railway line (Mombasa-South Sudan- Kampala-Kigali) is in pipeline.

The new line will have a standard gauge, which is wider, and therefore faster and capable of carrying heavier loads.

The project will be jointly financed by the four partner states and each state will develop the railway line within the confines of their boarders.

Work expected to be completed by 2018.

Air

Rwandair is the national air carrier with flights to 15 destinations including Nairobi, Entebbe, Arusha, Mombasa, Dubai, Lagos, Johannesburg, Accra, Juba in South Sudan, Brazzaville and Libreville among others.

Other international airlines include Kenya Airways, Ethiopian Airlines, Brussels Airlines, KLM, China Postal Airlines, South African Airlines, African Star Airways, Qatar Airways, and Turkish Airlines.

A new world class airport (Bugesera International Airport) is planned. The airport will provide both extra capacity for passenger transport and will also develop cargo freight.

Opportunities for Investment:

Priority investment sectors:

Airport ground handling

Waste collection disposal

Waste recycling plant

Water transport infrastructure

Road construction, rehabilitation and maintenance

Bugesera International Airport (BIA)

Kigali-Kampala -Momba sa Railway Line

Air transportation

Cargo transportation

Airport services:ground handling, pilot training

Agriculture

Agribusiness is the principal sector in Rwanda contributing over one third of the country’s GDP.

Coffee and tea are Rwanda’s main sources of foreign exchange.

In 2012, food crops harvest for season 2012 A rose by 1.3%compared to 2011.

Export crops (tea and coffee projected to grow at 22%.

Opportunities for Investment

Food processing for domestic and international markets; staple foods and significant potential for growth include beans, rice, maize and potatoes.

Coffee – Washing and roasting opportunities as premium harvest grows.

Horticulture – Rwanda is well placed to serve the global, regional, and local demand for fruit, flowers and vegetables.

Distribution and cold chain – Need for improved infrastructure for export products.

Investment opportunities in  agriculture

Energy

Electricity accounts for about 5% of primary energy use in  Rwanda.

Biomass (the primary source of energy) accounting for some 84% of primary energy use and petroleum products account for the rest.

Generation

Power generation is set to grow from 110 MW currently produced to 563 MW by 2017-a projected growth of nearly 400%.

The GOR is committed to partner with investors in delivering this potential- by offering generous incentives and guarantees, both through Public Private Partnership (PPP) and Independent Power Producer (IPP) structures.

Government of Rwanda provides concession contracts with an underpinning Power Purchase Agreement (PPA)

Renewable Energy

Targeting 90% electricity from renewable source.

Hydro, solar biomass and peat. Methane Gas

Lake Kivu contains about 300 billion cubic metres of Co2 and 60 billion cubic metres of CH4     gas. An estimated 120 to 250 million m3 of CH4 is generally annually in the lake.

Rwanda wishes to utilize this resource to develop methane-to-power projects and other uses such as fertilizer and gas-to- liquid projects.

The methane in Lake Kivu is estimated to be sufficient to generate 700MW of electricity over a period of 55 years; Rwanda’s share of the total generation potential is about 350MW, with the rest being DRC’s share.

Information & Communication Technology

Rwanda continues to be one of the fastest growing African countries in ICT and there are several avenues for growth for the ICT sector – from e-commerce and e-services, mobile technologies, applications development and automation to becoming a regional center for the training of top quality ICT professionals and research. ICT in Rwanda Today

Major players in the ICT sector today are; MTN Rwanda, TIGO and Airtel a subsidiary of Bharti Airtel in India.

The number of active mobile-cellular phone subscribers has increased to 62.8% up from 55.1% (July 2013).

There are over 11 other internet service providers serving the rapidly expanding market.

The ICT sector is growing rapidly, especially in networking and software development. Rwandan companies are now exporting services to the region.

Carnegie Mellon University-Rwanda- a Center for Excellence designed to greatly increase ICT skills.

Opportunities in ICT

Software development i.e. mobile applications, innovative e-payment solutions.

Cloud computing.

Mobile applications.

ICT education and training.

ICT business financing.

ICT related services i.e. systems integration, web management, data processing, application development.

Business process outsourcing and call centers.

Human resource related services for example payroll, recruitment and staffing.

Communication and media services.

World class Technology Park.

IT security solutions.

Internet Data Centers.

Real Estate and Construction

The Construction and real estate are key and potential drivers for future economic growth of Rwanda.

Total housing needs in Kigali (2013-2022) alone reaches 458,265 DU. This can only be met by building new dwelling units of up to 344,068.

The demand for social housing stands at 12.6%, affordable housing 54.1%, mid-range housing 32.8% and premium housing at 0.5%.

According to the Kigali Conceptual master plan, there are 35,590 Ha of land for potential growth in Kigali.

Residential real estate

GoR projects that by 2020 approximately 30% of the population will live in urban areas. To date, only about 7% of residents in Kigali own modern-style houses.

In Kigali alone, there is fast growing population (3% 5 year average) combined with urban growth currently at more 4% per annum.

Annual new dwellings supply in the formal market in Kigali ranges from 800-1000 DU per year, about one quarter of formal supply is in apartments, the rest are detached units.

Building and other construction materials available now in Rwanda to drive the growth of the real sector.

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