Rwanda‘s investments, both foreign and domestic have steadily grown owing to good governance in promoting and facilitating trade and investment in the country, a top government official has said.
Vincent Karega, the State Minister for Industry and Investment Promotion cited real estate, tourism, finance and mining as the industries that have been at the centre of investment growth in Rwanda.
Currently, investment growth is estimated at over 20 per cent in the past few years.
Karega’s comments come after he was being interviewed on this years’ World Investment Report released September 24. The minister said “the report is good news”.
On Rwanda’s performance the minister said that with this growth and with investment increasing in almost in all sectors, the country is also getting better.
He added that, “We expect investments both domestic and foreign to keep increasing in the country because some of our bottlenecks such as energy are being resolved.”
Karega explained: “To facilitate investment, we have had reforms in our sectors such as creation of commercial courts, business registration office and put in place investment incentives which will assist investors.”
Rwanda Investment and Export Promotion Agency (Riepa)’s statistics indicate that last year Foreign Direct Investment (FDI) registered 39 projects with a combined total value of Frw126 billion or $229 million.
Out of these, 276 projects valued at $202 million (Frw111 billion) have started operations.
He is also optimistic that the current investment figure will double due to reforms being embarked on in order to further ease doing business.
Karega pointed out that REIPA has spearheaded investment promotions in the country for instance through establishment of the One Stop Centre for all investors.
The agency has established about 444 of projects valued at around Frw987 billions within seven years of its existence. Before its establishment (in 2000), there were only 25 projects worth Frw10 billion.
Karega’s comments come when the 2007 World Investment Report—an annual publication of the United Nations, indicates that FDI inflows to Africa grew from $46 billion in 2006 to $53 billion in 2007, a 16 per cent increase.
According to the report in 2007, Foreign Direct Investment (FDI) inflows to LDCs in Africa increased from $9.6 billion in 2006 to $10 billion in 2007.
The report indicates that Trans-National Corporations (TNCs) from United States and Europe were the main investors in Africa followed by African investors particularly from South Africa, Egypt and Morocco.
It also states that most of the FDI were in infrastructure development, Greenfield expansion prospecting for reserves of base metals and oil while other inflows went into privatization schemes in the telecommunication and electricity industries.
UNCTAD’s 2008 annual global investment review is subtitled “Transnational Corporations and the Infrastructure Challenge.”
Supachai Panitchpakdi, UNCTAD Secretary-General said, “Investment in infrastructure is part of the unfinished agenda of development.
He said this is apparent in the daily power outages that stifle economic growth in Africa and in the lack of access to drinking water for millions in Africa and Asia.
TNC investment in infrastructure could therefore help meet some urgent development goals.”
The report stresses that meeting the huge needs of developing countries for infrastructure such as roads, ports, and electricity supply is a major challenge and requires better use of private-sector resources, including those of transnational corporations (TNCs).