How Rwanda rose in 2018 WB Doing Business Report

By: Collins Mwai

(L-R): World Bank country manager Yasser-El-Gammar, Trade and Industry minister Vincent Munyeshyaka and Rwanda Development Board chief executive Clare Akamanzi during the launch of Doing Business Report in Kigali yesterday. (All photos by Sam Ngendahimana)

Implementing five reforms saw Rwanda rise 15 places in the 2018 World Bank Doing Business Report to feature in in position 41 globally.
Rwanda is 2nd on the continent behind Mauritius in the latest annual report released yesterday. The report examines the regulations and conditions that enhance or limit business conduciveness.
Last year, Rwanda was ranked 56th globally.
Kenya came third in Africa (80 globally) followed by Botswana (81st worldwide).
Over the course of the last one year, Rwanda implemented five reforms, making it easier to do business, especially impacting the small and medium enterprises.
Among the reforms include improving construction permit process by increasing quality control and risk-based inspections.
The process had previously been termed as lengthy and time consuming in the last edition of the report as additional requirements saw Rwanda drop from 37th to 159th position globally in dealing with construction permits.
By upgrading existing systems to roll out the Building Permitting Management Information System, the time taken and cost to obtain permits reduced by at least 10 per cent, the City of Kigali says.
The system allows applicants to track the progress of their applications online, through SMS and email.
Another major reform that helped improve Rwanda’s ranking was easing the payment of taxes by establishing an online payments system.

Minister Vincent Munyeshyaka consults Clare Akamanzi before briefing media about the report.

In the previous edition, Rwanda had slid 11 places largely due to a new law requiring businesses to make monthly declarations as opposed to quarterly, which was found to hold back businesses.
Improvement in registration of property by implementing online services also facilitated Rwanda’s progress. The country is currently the second in the world in property registration after New Zealand.
Grace Nishimwe, the deputy registrar of lands, said this was made possible by availing information on land, registration of plots across the country and using the Irembo platform for property transfer, among other improvements.
Reforms by the Rwanda Development Board also strengthened the protection of minority investors.
The new reforms improve conditions for minority investors by upholding shareholders’ governance and control structures as well as requiring more corporate transparency. With the new reforms, the shareholders can sue directors while the reforms also clarify ownership of corporations.
The enforcing contracts indicator was also made easier as judgements made at all levels in commercial cases are now made available to the general public via the Judiciary’s website.

The world bank country manager, Yasser-El-Gammar speaks to the media after the launch.

‘Satisfactory assessment’
Trade and Industry minister Vincent Munyeshyaka said the report assessment was “satisfactory.”
“Over time, we have found the report a useful tool as we seek to attract investments into the country. It will help us identify areas where we need to improve and inform policy,” he said.
He said, going forward, it might be beneficial to also factor in aspects related to reducing the cost of doing business, which is key for countries.
Previous reports have indicated a major challenge of a disconnect between the implementation of the reforms and the business community.
This presented instances whereby, when interviewed by the report’s authors, a number of business operators would be ignorant of reforms.
Clare Akamanzi, the chief executive of RDB, told The New Times that this has since been corrected by ensuring that stakeholders in a specific sector are always updated on reforms.
“What we have learnt is that, as government, we should communicate and ensure that people in that specific sector get to know about it so that they can experience the reforms,” she said.

Participants follow the proceeding of the launch through Video conference at World Bank office in Kigali.

Munyeshaka said the Government is also considering preferential rates for productive users.
“We still have issues related to electricity. We need to have preferential tariffs for productive use and to focus on that sector to ensure that they do not pay the same prices as other consumers,” he said.
Current electricity tariffs have consumers with large industries pay Rwf83 per kilowatt, those with medium industries Rwf90 per kilowatt, while the small industries pay Rwf126 per kilowatt.
World Bank country manager Yasser El Gammal noted that much of the progress was a result of consistency and being systematic.