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Services sector in Rwanda
In its long term economic development plan, Vision 2020 , Rwanda aims at becoming a knowledge-based economy and in this endeavor the development of the services sector is considered as a critical pillar.
The sector has experienced a steady growth over the last 10 years. For instance in 2010, services accounted for 47% of the Gross Domestic Product (GDP) while agriculture and manufacturing were at 32% and 15% of GDP respectively. In the same year, the sector’s average growth was estimated at 10% as a result of growth in transport, storage, communication (9%), wholesale and retail trade (8%) and financial services (24%).
In terms of exports, apart from the traditional commodities (coffee, tea), Rwanda also exports transport services and financial services (insurance services) mainly to neighboring countries. In 2010 export of those particular services were estimated at usd235M.
The Services Development Department
The Services Department’s primary mission is to catalyse the development of service sector for job creation and economic growth.
With two (2) main divisions: the Financial Services Division in charge of financial services and Support Services Division in charge of other services but financial, the department covers the following services:
Priority sectors in services
Four (4) sectors have been identified as priority areas in services based on their high growth potential and the impact they can have on the economy once developed further; these include: financial services, transport, logistics and distribution services, business (professional) services and health care services. For each of those priority sub sectors, special strategies are being created with an integrated plan meant to further their development through private sector investment.
The country’s vision for the sector is to position Rwanda as a financial centre in the region. Still at the study level, the financial centre strategy is expected to be available mid 2012 with implementation starting in the 3rd quarter of the same year. The strategy will ensure the right regulatory framework is put in place for Rwanda to attract companies in the financial sector with varied services such as business transactions, brokerage and many others.
Today, players in the sector include banking institutions (14), insurance companies (7) and microfinance institutions (66). The Capital market launched in 2007 and under the supervision of the Capital Market Advisory Services – CMAC - is another important player and so far 4 companies are listed.
The central bank is the main regulatory institution of the financial sector in Rwanda.
Transportation, logistics and distribution service:
Rwanda today exports transportation, logistics and distribution services among others. With the plan of establishing a regional logistics and distribution hub, the sub sector is expected to grow further.
Professional services constitute another area with high potential for growth. As the economy continues to grow, support services such as professional services in engineering, architectural, legal, accounting will be in high demand. Big consulting firms such as PriceWaterhouseCoopers, KPMG, Deloitte&Touche and E&Y have already opened their offices in Rwanda and the country aspires to attract more reputable firms with varied areas of expertise to serve not only the domestic market, but also the region. The establishment of such firm will also contribute significantly to the development of the local labor force through skills transfer.
A strategy to assess what needs to be done in this area to achieve the set goal, will be released in the 3rd quarter.
Health care services:
Attracting investments in provision of health care services is another priority area. So far the country’s efforts for the sector based on MDG goals are focused on providing health care for all and fighting endemic diseases such as Malaria and HIV/AIDS. These deliberate efforts by the Government of Rwanda have so far yielded into reduced mortality and increased access to health care. In order to develop this sector further, private sector investment will be encouraged with the ultimate goal of positioning Rwanda among the best medical/health destinations. Attraction of reputable hospital chains with the expertise in the health tourism industry to come and establish in Rwanda is one strategy as well as forming strategic alliances with best hospitals abroad to supply world-class health care services. The hospitals will be serving not only the domestic but also the regional market allowing patients from beneficiary countries to access better treatment at an affordable price in the region.
A strategy is currently being developed and is expected to be released in the third quarter of 2012.
Useful links: Minisante,
Delivering on the mission, the Strategies
In order to achieve its mission, the Services Development Department will use the following strategies:
At the end of each year, the performance of the department is measured based on the following primary metrics:
For further information please contact the Services Development Department at RDB:
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