Investment Policy Review - Rwanda - UNCTAD Virtual Institute

Investment Policy Review of Rwanda
In particular, a major discovery of commercially exploitable base metals – a very uncertain but not
impossible prospect – and the involvement of a “major” could bring significant benefits to the economy
as a whole as it could make it economically viable to set up a rail connection to the ports of Mombasa
or Dar-es-Salaam, or to connect Rwanda to the South African power grid. Such an eventuality remains
very uncertain and based on the geology of Rwanda, and would – if it were to happen – be a least
10 years away.
UNCTAD’s strategy was presented at a workshop of national stakeholders in Kigali at the end of
March 2006. It was positively received and the Ministry of Lands, Environment, Forestry, Water and Mines
is pressing ahead with the reforms. The task force charged with setting up the future regulatory body, the
Office de Géologie et des Mines du Rwanda (OGMR), is also making rapid progress and has indicated
that it will take on board a number of UNCTAD’s suggestions.
F. Strengthening peace and stability through investment
Rwanda restored peace and stability very rapidly after 1994, and it has become one of the safest
countries in sub-Saharan Africa, with some of the lowest incidences of corruption. This remarkable
achievement is due to the country’s own political and social efforts. The adoption of the new Constitution
in 2003, the creation of Gacaca courts and the handling of land issues upon the return of refugees were
major steps towards justice, reconciliation and entrenching peace.
These efforts at the social, judicial and political levels will remain the key factors for peace, stability
and reconciliation in the future. Economic development, however, will also be a crucial element and should
build upon peace and stability and reinforce them in turn. The pressure on scarce natural resources, lack
of jobs in the formal sector, under-developed civil society and low level of education likely played a role in
the recurrent conflicts between communities after independence, culminating in the genocide of 1994.
The pressure on land and scarce natural resources and the shortfall of employment opportunities
remain an unresolved challenge. As highlighted earlier, Rwanda will need to go through a rapid process of
economic transformation in the coming decades if it is to engage on a sustainable development path. As
understood by the Government, private investment will be the main driver of this process. As a result,
private investment (local and foreign) will contribute to peace and stability through six main channels:
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Providing employment opportunities outside of traditional subsistence agriculture;
Lowering pressure on natural resources (particularly land) and providing alternative means of
wealth creation;
Contributing to the urbanization of the country;
Building Rwanda's human capital;
Contributing to a strong civil society;
Putting pressure on the Government to ensure good governance and building strong and fair
institutions.
The two key “horizontal” recommendations of this Review (centre of excellence and skills attraction
and dissemination programme) could go a long way towards strengthening public institutions and reinforcing
their accountability, and complementing the Government’s efforts to build human capital through general
education. The key contribution of this strategy of investment promotion, however, will result from the
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