IS RWANDA THE MOST COMPETITIVE ECONOMY IN EAST AFRICA?

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JDM, a journalist from Rwanda posed this question to me. To shed light on this, I look at (a) size of EAC economies, (b) look at the sources used by the World Economic Forum (WEF) to claim that Rwanda is most competitive, and (C) look at what WEF report is actually saying. I conclude that Rwanda’s competitiveness is fantasy.

SIZE OF THE ECONOMIES BEING COMPARED

Size-wise, Kenya is the biggest at $44bil gdp and $994 gdp per capita. Tanzania is at $33bil gdp and $695 gdp per capita. Uganda has $21bil gdp, and $572 gdp per capita. Rwanda gdp is $7.4bil and dgp per capita of $633. Kenya economy is nearly six times larger than Rwanda’s. Most investments into Rwanda come from Kenya (e.g. Kenya Commercial Bank, Serena Hotel, Equity Bank) as do most imports. Tanzania is over four times larger than Rwanda, while Uganda is nearly three times bigger. Rwanda, however, has a larger dpg per capita than Uganda’s.

WHO WRITES COUNTRY REPORTS THAT MAKE UP WEF REPORT?

So where does WEF get its sources to flatter Rwanda that it is more competitive than its bigger and better equipped neighbours? Let us quote the WEF: “this Report would have not been possible without the commitment and enthusiasm of our network of over 160 Partner Institutes worldwide. The Partner Institutes are instrumental in carrying out the Executive Opinion Survey that provides the foundation data of this Report as well as imparting the results of the Report at the national level.”

So who are the “Partner Institutes” in Rwanda responsible for “carrying out the Executive Opinion Survey that provides the foundation data of this Report as well as imparting the results of the Report at the national level”? According to WEF, the following institutions and individuals wrote the Rwandan part of the Report:

1) Rwanda Development Board (RDB): Claire Akamanzi, Acting Chief Executive Officer and Daniel Nkubito, Strategy and Competitiveness Division;

2) Private Sector Federation (PSF): Hannington Namara, Chief Executive Officer and Andrew O. Rwigyema, Head of Research and Policy.

Would this group of people provide an objective analysis of the Rwandan economic situation? Obviously not! This is like asking a student to grade himself.

AND WHAT DOES THE WEF ACTUALLY SAY ABOUT RWANDA?

The report actually contradicts itself.

See how the report describes Kenya in terms of education, research and collaboration between research institutions and industry, all of which are essential to competitiveness:

“Kenya’s innovative capacity is ranked an impressive 46th, with high company spending on R&D and good scientific research institutions that collaborate well with the business sector in research activities. Supporting this innovative potential is an educational system…”

Now see what the report says about Rwanda’s education:

“The greatest challenges facing Rwanda in improving its competitiveness are the state of the country’s infrastructure, its low secondary and university enrollment rates, and the poor health of its workforce.”

So how Rwanda become the most competitive if it is indeed in such a poor state? Some wishful thinking!

David Himbara

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