Foreign Private Capital (FPC) inflows into Rwanda increased by 33.8 per cent to $886.9 million (approx. Rwf1.2 trillion) in 2023, from $663 million recorded in 2022, a new survey report shows.

The increase is mainly due to inflows from six countries, namely Mauritius, India, USA, France, Germany and the Netherlands, which outweighed declines from Kenya and China, according to the 2024 Foreign Private Capital survey published on Tuesday, January 21 by the National Institute of Statistics of Rwanda (NISR).

FPC is defined as foreign liabilities (inward investments) owed to non-residents in terms of equity and non-equity, and foreign assets (outward investments) claimed to the rest of the world.

ALSO READ: Foreign capital inflows increase to Rwf226b

The survey largely attributed the registered growth to Rwanda’s consistent economic performance, with an average GDP growth of 8.2 per cent in both 2022 and 2023, as according to the NISR.

It focused on both equity and non-equity inflows and stocks encompassing 383 companies, of which 338 responded, yielding a response rate of 88.3 percent.

ALSO READ: Foreign direct investment into Rwanda up 63% in first half of 2024

Foreign Direct Investment (FDI) was the primary driver of the FPC inflows, accounting for nearly 81 per cent share or $716.5 million. The share of FDI represents an increase of 44.3 per cent compared to 2022.

FDI was followed by other investments, which accounted for 18 per cent and Foreign Portfolio Investment at 1.2 per cent, the report showed. Overall, the survey mentioned that in Africa, FDI inflows fell by 3 per cent to $53 billion in 2023.

The leading countries

According to the survey, FPC inflows from Mauritius led with a share of 29.4 per cent or $261 million of the total, mostly invested in electricity, gas, steam and air conditioning supply, as well as in finance, manufacturing, wholesale and retail trade sectors.

Inflows from India and Kenya represented 9.8 per cent ($87.2 million) and 7.8 per cent ($69.2 million), respectively, mainly invested in ICT, financial and education sectors.

Other countries with a relatively significant share in the FPC inflows are USA (with $68.3 million or 7.7 per cent of the total), France ($62.7 million or 7.1 per cent), and Germany ($57 million or 6.4 per cent).

Inflows from the three countries saw substantial increases compared to the previous year, with those from the USA growing by 123 per cent, France 295 per cent and Germany 1,350 per cent. These inflows mainly went to real estate, manufacturing and agriculture sectors.

Sector of economic activity with largest shares

In terms of the distribution for FPC inflows in 2023, the financial sector received the highest investment totalling $236 million, which accounted for 26.6 per cent, followed by manufacturing at $165.2 million (18.6 per cent), ICT at $107.4 million (12.1 per cent), wholesale and retail trade at $105 million (11.8 per cent) and real estate activities at $90.3 million (10.2 per cent).

Regarding job creation, the findings show a 20.3 per cent growth, reaching a total of 59,916 employees (58,415 locals and 1,501 foreign) in both short-term and long-term positions.

The report highlights Rwanda’s status regarding foreign private investment and ongoing commitment to attracting foreign investment, according to the NISR.