The business community this week welcomed the newly announced doing business reforms saying they would improve business in the country.
The Rwanda Development Board (RDB) introduced new reforms that simplify starting a business, dealing with construction permits, registering property, and trading across borders.
Others are streamlining insolvency procedures and increasing credit availability.
Peter Gapira, the Operations Manager of the Gorilla 1000 clearing agency that operates from Kigali International Airport and Gikondo welcomed the reforms, particularly trading across borders.
“There has been a long process in import and export declaration, where goods would spend a long time in the warehouse and this drew complaints from investors and other business stakeholders,” Gapira said.
He highlighted additional trade facilitating mechanisms pioneered by the Rwanda Revenue Authority (RRA), “like Blue Channel, where an importer is allowed to offload goods from his premises instead of offloading from the warehouse which involves other charges and processes.”
“There is another called pre-clearance, where taxes are paid when goods have not yet entered the country’s borders, and when they come, they directly go to the importer's premises.
This also reduces the processes and other charges,” Gapira said. He further commended the 24-hour border operations and use of scanners in warehouses and at border posts.
Kajuju Kageenu, the Business Manager of a private equity outfit – Fusion Capital Ltd, which recently opened shop in Rwanda, said: “As a financier, the reforms announced by RDB will greatly improve business.”
Fusion is a non-banking institution specialising in financing small and medium enterprises (SMEs).
“Reduced procedures and documentation required for construction permits and import /export requirements will encourage more small and medium scale players,” Kageenu said.
“Improvements in the foreclosure process is also highly welcome.
In addition to helping financial institutions to fast liquidate securities held for non performing facilities, it will help build a more disciplined repayment culture with borrowers,” she added.
In the four new reforms, when starting a business, one can register online for free. For those registering in person, fees were slashed from Rwf 25,000 to Rwf 15,000.
In a single application, a client can now apply for a construction permit, water connection, electricity and telephone. Inspections and invoices would also be issued simultaneously.
In cross-border trade, only three out of eight documents necessary for customs declaration are needed. These are the commercial invoice, the parking list, and the bill of landing or airway bill.
Rwanda was declared the best reformer in the 2010, according to the World Bank.
The government aims to be among the top 30 reformers, worldwide, within the next seven years.