Market News | POWER & ENERGY RWANDA 2017

Market News

Why Rwanda is a market to target

Rwanda the land of a thousand hills is also known as one of the world’s fastest-growing economies, Rwanda has established the powerful role of entrepreneurship in reconstruction and reconciliation. The country’s annual GDP growth has averaged 8 percent over the past several years, and the percentage of people living in poverty has declined significantly. Rwanda aims to become what it describes as a “knowledge-based, service-oriented economy with middle-income country status” within the next few years.

Rwanda has a population of 11.8 million people and a Gross Domestic Product (GDP) of USD 8.096 billion dollars. Rwanda’s economy flourished by an average of 8 percent annually from 2002 to 2012, and then 6.9 percent growth in 2015 and 5.9 percent growth in 2016. The International Monetary Fund (IMF) expects Rwanda’s GDP to grow between 6-7 percent in 2017 and 2018.

There are many clear big picture economic signs that lead us to believe that Rwanda is the next country to target for conducting business. Here are some of the signs:-

  1. Inflation remains below 8 percent (pushed up from 5% in 2016).
  2. The country maintains its reputation for low corruption
  3. Rwanda's debt-to-GDP ratio at 40 percent is relatively low
  4. The percentage of foreign assistance in the country’s annual budget has dropped from over 80 percent a decade ago to 38 percent in 2016/2017 National Budget
  5. Rwanda enjoys relatively high rankings in the World Bank's Ease of Doing Business Index, which ranked Rwanda 59th out of 190 economies in the 2016 report—second-best in sub-Saharan Africa behind Mauritius.

Leading sectors in Rwanda include energy, agriculture, trade, hospitality and financial services. Rwanda’s economy is essentially rural and heavily dependent on agriculture but they have big plans to change things. Strong and steady growth in the services sector particularly construction and tourism have contributed immensely to overall economic growth.

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The government’s economic priority is turning Rwanda into a regional trade, logistics, and conference hub. Pillars of this progress include the construction of several new international business class hotels and a convention centre in downtown Kigali and expanding and investing in the fleet for the national carrier RwandaAir.

When we talk about the exports, Rwanda’s exports increased by 7.4 percent year-on-year in 2016, reaching USD 621.6 million according to UN ComTrade data. Commodities, mainly gold, tin, tantalum, tungsten, tea, and coffee, got over 48 percent of its export revenue. Rwanda earned USD 73.5 million from tea exports in 2016, a nine percent increase from 2015.

Over the same period, coffee accounted for USD 59.5 million worth of exports, down seven percent from the previous year. Major markets for coffee exports are the United States and Europe, while the Middle East and Pakistan are the main buyers of Rwandan tea. 

Tourism was, for the first time in 2016 the country’s leading foreign exchange earner with total revenues estimated at USD 390 million in 2016, according to the National Bank of Rwanda. 
Leisure tourism and Business tourism played pivotal roles in this upsurge. They are the highest income generating sectors. The escalation of Meetings, Incentives, Conferences and Events (MICE) led to the same.

When it comes to crime rates Rwanda’s strong police and military provide a security umbrella that minimizes potential criminal activity and political conflicts. 
Rwanda is not for the short-term investor, but there are opportunities to be pursued over the long haul.

  • RURA Aims to Power 70 percent of Rwanda

    Posted on :Wednesday , 11th October 2017

     RURA’s role as a regulator of the energy sector is to assist national socio-economic transformation and poverty eradication by providing sufficient, reliable, affordable and sustainable energy supply.

     
    The goal remains to create and foster an environment that encourages more involvement from the private sector, which is only positive and a change from whe. . .

  • Rwanda to Have Complete Access to Power Within 7 Years

    Posted on :Friday , 6th October 2017

     Rwanda Energy Group has intertwined its energy rollout plan to fit that of the Rwandan government. Nationwide energy supply is to be its primary objective over the next seven years. 
     
    The REG also stated that there are no plans in place for the additional supply of power to the grid prior to 2018. This new strategy has come in a time of uncertai. . .

  • $100 million Mining Deal Agreed in Rwanda

    Posted on :Tuesday , 26th September 2017

     USA based Symbion Energy and Germany based Higland Group Holdings Ltd. (HGHL) have signed a $100 million deal to collaborate on a project to extract Methane from Lake Kivu in Rwanda.

     
    Symbion CEO, Paul Hinks said that the two designs in place for a $370 million project to generate as much as 106 megawats of Methane gas from the lake.
     
    <. . .

  • Norwegian energy sector eye investments in Rwanda

    Posted on :Friday , 22nd September 2017

     10 companies from the Norwegian energy sector were hosted by the Rwanda-Norway Energy Forum last week.
     
    Rwanda’s energy continues to have tremendous potential for future growth as only 35 per cent of the country has access to electricity. The goal is to convert that number to 70 percent by 2018 and 100 per cent by 2024 according to the Rwanda Energy G. . .

  • Rwandas Mega Project In The Works

    Posted on :Tuesday , 19th September 2017

     Reliable power will be achieved with the completion of Nyabarongo hydropower project in the western part of Rwanda .

     
    The project is possibly the largest hydropower installation in Rwanda. More than 28MW of electricity is contributed by it to the national grid.
     
     A significant challenge to energy utilities has been the develop. . .

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