How to Tackle the 10 Biggest Obstacles Of Private Sector Firms In Rwanda . Rwanda was the world’s top reformer in Doing Business (DB) for the year 2010 says the World Bank. It jumped 76 places from position 143 to 67. This is the highest improvement in the history of the annual rankings of the 183 countries of the world.
After the 1994 genocide, the government faced the challenge of getting popular private sector participation to aid the quick economic recovery that was so essential for Rwanda’s survival at the time. The government then committed itself to implementing a very concentrated reform agenda. This agenda helped in creating the right atmosphere for private sector participation. The private sector still faces some 10 noticeable obstacles. Here we are not going to look at the obstacles but how to tackle them.
The competitiveness and enterprise project, started by the international development association (IDA) in 2001 and the Rwanda investment climate reform program which was initiated through the World Bank Group’s investment climate advisory services in 2007 are two World Bank projects that greatly aided the government in its efforts to improve the investment climate. Both projects were designed to ensure facilities that established the great improvement in private sector participation – and they did just that. They provided assistance that was targeted at improving the investment climate and created capacity building institutions to make sure the reform momentum was sustained.
The result of these collaborations with the World Bank has been a healthier financial sector with more private sector participation. The result has also been reflected in the adoption of reforms in 7 out of 10 Doing Business topics. The setting up of a Doing Business centre in the Rwanda development agency and the preparation of several laws led to the reforms being very effective and enhanced public private sector dialogue and this has made doing business in Rwanda to become faster, easier and less expensive.
You can now start a business in Rwanda within 3 days as against the 14 days that used to be the case. This is because the procedures you go through have been cut down from 8 to 2. The cost of starting a business, registering a property, importing, exporting and administrative procedures for the fiscals of businesses have either been reduced or streamlined all in an effort to ensure that doing business in Rwanda becomes as easy as possible. These policies have paid off greatly in the long run. The non performing ratio for banks has been decreased it was at 12% in 2009 compared to more than 30% that obtained in 2000.
So, how are the 10 biggest obstacles of private sector firms in Rwanda to be tackled, The answer to that question is by being consistent and following up on these policies that are already working. As that is being done, the government should be on the lookout for other policies and collaborations that will further compliment the ones already being used. This will ensure a more popular private sector participation which is what lifts every nation’s economy to lofty heights.