President Kagame working visit to the Netherlands

On the picture President Paul Kagame from Rwanda during his speech in Amsterdam.

President Kagame concludes two days official working visit to the Netherlands.

By Jean Pierre Karabaranga, Ambassador of Rwanda to the Kingdom of the Netherlands.

On 5 and 6 October 2015 President Paul Kagame concluded a two-day official working visit to the Kingdom of the Netherlands.

After addressing over four thousand Rwandans and friends of Rwanda during Rwanda Day in Amsterdam on Saturday 3 October, President Kagame commenced his official working visit to the Netherlands by meeting His Majesty King Willem-Alexander in The Hague before holding discussions with Queen Máxima that mainly dwelt on financial inclusion.

For a photo album on Rwanda Day in Amsterdam featuring President Paul Kagame visit, please click here: https://www.flickr.com/photos/paulkagame/page3

As one of Rwanda’s earliest development partners after the end of the Genocide against the Tutsi, the Netherlands continues to be a key supporter of Rwanda’s justice sector and Food Security .

President Kagame also held discussions with President of the Senate Ankie Broekers-Knol and Speaker of the House of Representatives Anouchka van Miltenburg as well as Mr Bert Koenders, the Minister of Foreign Affairs and Mrs Liliane Ploumen, Minister for Foreign Trade and Development Cooperation of the Kingdom of the Netherlands

During the meeting with the President of the Senate and the speaker of the House of Representatives, President Kagame highlighted the strength of Rwanda’s bilateral relations with the Netherlands: “The country was rebuilt from scratch, thanks to the resilience of the people of Rwanda and support of partners such as the Netherlands. Rwanda has been developing over the last two decades against many challenges in different areas.”

Commenting on Rwanda’s success on the MDGs, the President of the Senate and the Speaker of the House of Representatives expressed commitment to continued and strengthened bilateral relations.

Speaking during a business roundtable dinner hosted by Sharon Dijksma on Monday 5 October, President Kagame encouraged business leaders to join Rwanda’s journey:‎ “Investments in Rwanda not only have returns for investors but it also has impact in transforming lives.”

President Kagame ended the working visit after meeting with Bert Koenders, the Minister of Foreign Affairs of the Kingdom of the Netherlands.

The Netherlands is leading among European nations in holding genocide fugitives accountable and remains a key partner to Rwanda in the justice sector as well as water management and food security.

Tweeting at the end of the visit, Minister Mushikiwabo pointed to progress made on investment from the Netherlands, including Heineken which is doing good business and KLM, a Dutch airline that has daily flights to Kigali, not to mention investments in energy and agribusiness among others. She pointed out that the visit was two days of productive discussions on business, politics and global issues.

Investing in Rwanda

Rwanda is a resilient, forward looking country with a clear vision to elevate to a middle income, service and knowledge based economy by 2020.

Key Achievements include;

• the 2014 World Bank report : Rwanda among the fastest growing economies of the world
• Growing the economy at an average GDP of 8% p.a. and we aim at achieving 11.5% from 2015 – 2020
• Growth of the GDP per capita in 2013 $693 from $644 in 2012, a 3 fold increase from 2000. Our GDP target is $1,240 by 2017
• Rwanda’s strong performance is largely driven by the expansion of the service sector. The sector contributes about 48% of GDP compared to 33% and 15% contributed by agriculture and industrial sectors respectively
• Inflation in Rwanda has been kept at a single digit since 2008
• Fitch Ratings Ltd, sets Rwanda’s Credit rating at B+ with a positive outlook, citing strong economic growth over the past years and prospects for stronger growth.
• Rwanda is the safest country to live in Africa. (Gallup Report 2012)
• Clean and green city, with the lowest crime of any capital city in the region , Kigali declared winner of UN Habitat Award (2008)- highest award for an urban area
• 2^nd Safest city in the world for women to walk alone (Gallup report 2013)
• 3^rd easiest place to do business in Africa
• 4^th easiest globally for a business to get credit
• 8^th easiest globally to acquire and register a property
• Top global reformer 150^th to 46^th in 6 years ( by IFC and World Bank )
• Most competitive place to do business in East Africa and 2^nd in Africa, after Mauritiusv( by World economic Forum )
• 7th best destination for investments. 2nd in Africa after Botswana. (BPI Index 2014)
• 6 hours to register a business

An investor-friendly attitude

The Government of Rwanda is acutely aware that achieving the objectives of its Vision 2020 requires a substantial contribution by foreign investors, who need to be welcomed and assisted on the ground.

This awareness is reflected in several ways in the investment regime. Starting a business is much easier and faster in Rwanda, according to the World Bank, than it is in any of its neighbours. So is registering property. There are no sectors that are barred to foreign investors and no restrictions on the percentage of equity they might hold. The Constitution of 2003 also guarantees investors against expropriation, except in the public interest and with fair and prior compensation, which may be repatriated.

Varied opportunities

Rwanda offers investment opportunities in just about every field, many focused on the local market and some on markets abroad. There are opportunities in manufacturing, for each type of investors targeting the local market, and the regional one, to which Rwanda’s strategic location provides good access.

There are opportunities in agriculture: in the processing and export of coffee and tea, as well as in the virtually unexploited potential in horticulture and herbal products, where the terrain and climate are strong advantages.

Then there is tourism, where the great asset is the mountain gorillas in Virunga but there is also a great diversity of fauna and flora and Lake Kivu in the west. In order to accelerate this growth, a new strategy for the sector focusing on the area of Meetings, Incentives,

Conferences and Events (MICE) has been developed and is being implemented . Finally, the Government has made information and communication technology (ICT) a high priority and is in the process of developing a TechnoPark near Kigali to facilitate investment in this area.

Soft assets

There are some very special features of Rwanda that are little known abroad, where the overriding association of the country is with the genocide of 1994. For one thing, it offers a safe and peaceful environment, with very low levels of crime (not something that can be said of many countries ).

For another, there is very little corruption in the country, another distinct advantage among developing countries generally. For a third, it has a strongly development oriented Government, with a coherent vision of the future and a serious commitment to sustained reform. Lastly, Rwanda is an exceptionally beautiful country with a temperate climate (on account of its elevation), which would be very appealing to most foreign investors as a place to live in.

 Rwanda’s investment opportunities – Projects 

ENERGY :

• Power generation needs to grow to 563MW from the current 119MW by 2017- a projected growth of nearly 400%, and by 2020 to over 1000 MW. Connectivity rate must also increase from current 20% to 70%.
• Hydropower Generation
• 78 micro hydropower sites have been identified. of these, 28 sites have feasibility studies already concluded. Total estimated capacity of all the 78 sites is about 25MW
• Methane power Generation
• 20 year concession for 25MW tender to be launched soon. 150MW concession already been given to 2 companies
• Peat to Power Generation
• We have an investor developing 100MW
• Geothermal exploration
• Rwanda’s geographical formation holds potential for geothermal energy sources

TRANSPORT : MOMBASA – KAMPALA – KIGALI RAILWAY

• Kigali to Mombasa -1,900km, 100 km inside Rwanda, 250 km to Bujumbura
• Status: Feasibility and designs currently under way, to be completed by Dec 2015
• Financing model: PPP
• Project cost. Est. $3.5billion, with each country contributing to this cost
• An alternative route to the Kigali-Isaka-Dar es Salaam line

Eldoret-Kampala-Kigali oil pipeline Project

• Project description: EAC flagship project to ease the transportation of oil and petroleum products from Kenya to Kigali through Kampala.
• Financing model: PPP
• Project cost. Est. $402 Million
• Status: Kampala–Kigali feasibility study underway, with findings expected Dec. 2015

KIGALI LOGISTICS PLATFORM PROJECT

• The Integrated trade logistics facilities project, Kigali Logistics Platform– To transform Rwanda into a logistics hub in the region
• Functions:
  • Projected to handle 600,000T by 2026.
  • 50ha set aside- management Tender over a 20 year concession to be given this year.
  • IRR projected to be 23%.
  • Financing model: PPP
  • Cost: $28 million – Phase 1 to develop 8ha

 AIR CARGO PROJECT

• Project Cost: Est. $500,000 (This is not a greenfield investment, some expansion to existing facilities is required)
• Description: Transfer Management of logistics zone to a private competent and experienced firm to support imports and exports of high quality, value-added perishables, (e.g. horticulture).

More Opportunities in:

• Bonded warehouses (near DRC Border)
• Off-dock facilities at Mombasa (land given by GoK)
• Agro-logistics (sorting, weighing, packaging…)

TECHNOLOGY PARK

ICT is a pillar of Rwanda’s Vision 2020; Over 5000km of fiber optic laid around the country

• Park will be an eco-system of centers of excellence with universities
• Target – Universities, MNC’s in Financial Services, data, business continuity, agriculture & commodities, knowledge management
• Investment value: $350 M
• 63.1ha allocated in SEZ phase II
• 15ha is taken up by Carnegie Mellon University
• Current Activities: Feasibility study, master plan and architectural designs completed

REAL ESTATE AND CONSTRUCTION

• Affordable Housing: 180,000 units required to meet demand
• Spending in construction industry grew by 130% (up to $500million) between 2009 and 2012.
• Leading contributor to GDP at 15%
• Huge demand for residential & commercial housing- 344,068 dwelling units needed to meet the current needs
• CBD– fully serviced land (water, electricity, drainage systems, fiber) available for mixed use, that is, commercial complexes and shopping malls. Cost of land-$85 per M^2.

MANUFACTURING PACKAGING MATERIAL

• Increased imports of paper packaging, $28m imported annually for the last 3 years
• Currently only 3 local producers of paper packaging
• High demand due to national ban on plastic packaging

MANUFACTURING TEXTILES

• Silk industry- growing sericulture sector, supported by the National Sericulture Center (NSC)
• High imports of textiles reflect high demand for garments –$68M imported in 2012
• Rwanda to expand Mulberry cultivation from 350 ha to 10,000 ha by 2017
• Rwandan cocoons provide very competitve grade 4A silk yarn
• Opportunity to sourcing fabric locally for producing garments for local and export market.
• Opportunity to produce silk yarn for export

MANUFACTURING FERTILIZERS

• Invest $1.2M in a fertilizer manufacturing plant with an IRR of up to 40%
• Agriculture employs 72% of the population,.
• In 2012, Rwanda imported 45.5T of fertilizers worth $46M
• Potential annual sales of 14,000 MT from Rwanda, and potentially expand into East DRC & Burundi
• Use of fertilizers central to increase production volumes/yield
• Fertilizer usage has grown to 32,000 MT over the last 6 years.

MINING OPPORTUNITIES

A leading foreign exchange earner. In 2013 export revenues from mining were $226.2M Mineral Exploration in the identified 21 Prospective Target Areas. Value Addition- Establishing processing plants to smelt ores.

Mining & Mineral Trade in:

• Tin, Tungsten and Coltan
• Gemstones. E.g. Beryl (Aquamarine), Corundum
• Industrial Minerals – Silica sands, Limestone, Talcum, Kaolin, Vermiculite, Diatomite, Clay, Gypsum and PozzolanFINANCIAL SERVICES HUB

• Rwanda aims to become the financial hub of the region.
• 58% of Rwandans have no access to formal financial services.
• Return on Equity 12.2%

Opportunities in:

• Investment banking services, asset management, Insurance policies and other innovative assurances schemes
• Private equity funds
• Housing Banks and Agriculture financing

KIGALI FRESH WHOLESALE FOOD MARKET

• 10ha set aside in SEZ Phase 2. Expected to handle 300,000MT of fresh fruits and vegetables by 2030
• Investment: $31 million Responsible Agency: NAEB Financing Structure: PPP.
• Opportunity to earn in Avocado packaging and export – $1.6Bn in annual potential Avocado trade
• Opportunity in Mechanization– Irrigation and sale of agricultural equipment for large scale farming.
• Opportunity to invest $10M in Bean processing and canning
• Value addition – Washing and roasting opportunities for coffee and tea

MANUFACTURING ELECTRICAL CABLES

• Currently no local manufacturers , high local demand
• In 2011 electrical cables imports estimated at $28 million
• $2.8B Energy Sector Strategic Plan (2013-2018) targeting 70% nationwide connectivity by 2017 expected to drive demand
• Investment level– $10 Million

MANUFACTURING STEEL PRODUCTS, HOLLOW SECTIONS, ROOFING SHEETS

• Steel building products worth over $81million were imported in 2012
• No 1 import category for construction, outranking even cement)
• Currently we import mainly from Mauritius, South Africa, India and China
• Opportunities in manufacture of
• Hollow sections
• Roofing sheets
• Rolled steel plates
• Accessories such as gutters, ridges, wire meshes, et al.
• There are about 6 local manufacturers currently in this industry.

MANUFACTURING SHEET GLASS

• Float and architectural glass for building construction is in high demand. Currently, this glass is mostly imported
• Rwanda has significant deposits of the main raw materials required for float glass manufacture
• Setting up a Float glass factory to serve Rwanda and EAC’s growing demands for construction materials
• In 2011, 3,938 MT (equivalent of $4 million) of sheet glass was imported.
• Glass container factory that can serve the EAC & DRC beverage industry with bottles and drinking glasses.

Photography by the Embassy of Rwanda.