New and better roads and other infrastructure can only take you so far in doing business. The world is changing fast and becoming online-centric, and globalisation means that those hesitant to embrace new technologies risk being left by the wayside.
A country’s willingness to adopt new technologies may make or break its competitive edge in regional trade. Rwanda is clearly doing better on this front, as is witnessed by recent adoption and integration of latest technology in regional trade. Rwanda has automated key trade processes that impact on imports and exports and the speed at which clearance is done. Such include the processes at institutions within the Rwanda Development Board, including the RALICS portal, The Rwanda Electronic Single Window, and now with support from UK’s DFID we are developing an Electronic Cargo Tracking system (ECTs) which will be connected to regional ECTs.
A recent report by TradeMark East Africa indicates that the cost and time of doing business in Rwanda has reduced significantly as a result of the automation of key trading processes, improvement in standards testing and capacity building to enhance export capability.
Investments in infrastructure at the country entry points and automation of key trading agencies have greatly contributed to this improvement. For example, the border clearance time at Kagitumba has reduced by 25 percent. The report by consulting firm MarketShare further adds that infrastructural and technological interventions have reduced the time taken to transit a cargo container through East Africa’s main transport corridors. How fast Rwanda adopts new technology solutions is clearly a major contributor to this change.
The World Bank’s Ease of Doing Business report released in June 2016 places Rwanda at position 56 globally, making it the most attractive East African country to foreign investors. Kenya comes at a distant second (92), followed by Uganda (115), Tanzania (132), and Burundi trailing at position 157 of the total 190 countries surveyed.
A combination of factors such as improved ease of starting a business, registering property, cross border trade and contract enforcement, have worked together to boost the appeal of the Land of a Thousand Hills.
Pundits’ wills say that the greatest single technological achievement in enhancing regional trade for Rwanda happens to be the Rwanda Electronic Single Window (ReSW). This system has radically reduced the average time to clear goods through customs from 11 days in 2012 to 1 day 10 hours in 2016. The ReSW allows for the submission of a single trade declaration containing all the information required by the various agencies responsible for controlling trade in and out of Rwanda, and solicit a rapid response from them to ensure faster cargo release. This is a great improvement from the old system, where importers and exporters were required to submit a variety of documents to multiple government agencies at different times.
RESW is integrated with INTERPOL database to trace black listed motor vehicles. In the event that a clearing agent tries to register an entry for the motor vehicle, the system checks against the Interpol database of blacklisted vehicles. In case the customs system red-flags the vehicle, an alert message is automatically sent and stops a clearing agent to proceed with registration until the issue is sorted out as stipulated in procedures for the Interpol. This has consequently reduced such incidences of crime.
Our adoption of technology to improve ease of doing business has not waned as currently, RRA with support from DFID through TMEA is now developing an Electronic Cargo Tracking System (ECTs). ECTs enable electronic monitoring of cargo in transit, designed to ensure that the cargo is not diverted while on transit. It will consist of an electronic seal, which is monitored online by cargo owners, transporters and customs agents. ECTs controls and reduces transit time by eliminating unscheduled stops and cargo loss and dumping. A rapid response unit complements the ECTs by responding to any unscheduled stops or breaking of the electronic seal. Rwanda ECTs will be connected to the regional ECTs meaning cargo heading to Rwanda will be tracked from Port to Kigali. ECTs is already in use in Uganda where it has revolutionised how transit cargo trucks operate; with over 15000 trucks tracked annually and recording cost savings of US$ 400 to 600 per truck. Rwanda can expect to record such gains, and even more once its ECTs is launched in February 2017.
While the World Bank report did not consider technological capacity among parameters informing ease of doing business in Rwanda, it never the less evaluated access to electricity. On this factor, Rwanda had improved by 2 places to 117 out of the 190 countries ranked. This is a promising trajectory, as one of the greatest inhibitors to the adoption and use of new technologies is the lack of access to a reliable source of power. Human limitations still hamper the rate at which goods move between countries. Yet many new technologies are being rolled out every day, designed to deal with these challenges. We will all be wiser to pay attention.
Patience Mutesi, is Country Director, TradeMark East Africa, Rwanda