The US Senate, last week, approved a Bilateral Investment Treaty (BIT) with Rwanda, a deal which was first signed, in 2008, by President Paul Kagame and then US leader George W. Bush, during the latter’s visit to Kigali.
The treaty – the first the US has signed with a sub-Saharan nation within the last decade – is anchored on the principles of open investment and trade policies in both countries, and seeks to bolster the links, especially through the private sector.
Under the BIT, the parties undertook to accord non-discriminatory and fair treatment to each other’s businesses, allow free transfer of investment funds, transparency, and to refer investments disputes to neutral, international panels.
The development comes in the wake of Rwanda’s impressive and widely acknowledged business reforms that have made the country an ideal investment destination.
The BIT resonates well with Rwanda’s ambitions to become a top regional investment and business hub, and will help build confidence among investors.
With the world staring at another potential crisis, owing to the current debt crisis in some of the major economies and a sluggish recovery from the 2008 recession, countries like Rwanda need to put more efforts in widening their export base, as well as attracting foreign investors.
With increased investments and export base, Rwanda will not only reduce reliance on foreign aid, but will also mobilise the necessary resources to help achieve development targets as stipulated in Vision 2020.