00:00:01
hello i'm kathryn klein i'm the vice dean for social impact at Wharton and
00:00:06
I'm delighted to be here today with Francis guitari Francis is the chief executive officer of the Rwanda
00:00:13
development board and a cabinet member in the government of Rwanda he served previously as principal private
00:00:20
secretary to the President of the Republic of Rwanda and also as the chief economist and deputy head of policy and
00:00:27
strategy in the office of the president of rwanda so Francis thank you so much for being here with us thank you thank
00:00:34
you for having me that's wonderful to have you here so uh we want to talk today about business and Rwanda and
00:00:41
development of business in Rwanda a common phrase we here in the United States and around the world is Africa is
00:00:49
open for business certainly Rwanda is open for business before we get into talking about business and the private
00:00:56
sector in Rwanda I think it may be helpful for our listeners and viewers to hear more about Rwanda itself as I know
00:01:05
you know when we say Rwanda and people think of Rwanda unfortunately what comes to mind for many is the tragic history
00:01:14
of the genocide in 1994 and they may know a little else about Rwanda so what would what should people know about
00:01:21
Rwanda today thank you very much Catherine I think people need to know Rhonda as a nude Wanda in fact when we
00:01:30
talk about Rhonda now it's almost as if Rhonda had a new beginning starting in
00:01:37
1994 and since then we have had let's say every bath of a nation because what
00:01:45
many people around the world will always remember is that in 1994 our country Rhonda had a terrible genocide a million
00:01:55
people killed three million people displaced internally others outside as refugees infrastructure destroyed it was
00:02:06
a failed nation without governance or any economic talk of since then we have a new country
00:02:14
thanks to the leadership that was able to recover the country the country and restore its economy and restore the
00:02:23
confidence of the people and return the refugees and put back safety and security of property and people now we
00:02:32
have an economy that is fully functional that has more than four times grown what
00:02:41
it was then and in fact a country that we believe is beginning to show signs very strong science of of take off into
00:02:50
I would say a different stage of development so the idea of Rhonda being open for business is not just an idea
00:03:01
it's a reality and this is as a result of both you know public sector and private sector right right and and
00:03:07
everyone is actually one of the fastest growing economies in the world not only in Africa but in the world that's
00:03:14
correct in fact over the last 15 years Rhonda had featured among the fastest growing economies in the last ten years
00:03:23
alone we have had economy registering on average eight percent growth of GDP and
00:03:30
we have seen that translate into the per capita income of our citizens more than
00:03:36
four hundred percent in fact we just had new statistics coming out for the last three years alone we have had more than
00:03:48
600,000 people lifted out of poverty as a result of some of this economic growth
00:03:53
that we are seeing yeah huge success story so you are the chief executive officer of the Rwanda development board
00:03:59
so the rdb what tell us what they r DB is what is the mission of the rdb so the rtb oh the rounded whatman board has a
00:04:08
very simple and straightforward mission it was created as a result of a combination that our continued economic
00:04:17
growth requires big involvement of the private sector and so the requirement then for private sector investment was
00:04:27
how best can we facilitate private sector investment and our DB was created as this one-stop Center that would then act
00:04:38
as the single stop for every private individual or company that wants to the business in the country with three
00:04:44
objectives one to service the entire life cycle of the business so from registration licensing facilitating the
00:04:53
acquisition of utilities and whatever is required to start a business that it would all be done in one office the
00:05:00
second thing then would be to engage into the kind of reforms that are required to develop competitiveness in
00:05:08
the economy by looking around the world for the best practices how best could we
00:05:13
turn Rhonda into a competitive environment to do business and and then the third one was then to facilitate
00:05:22
these businesses into contributing to continue the growth in terms of exports in terms of attracting more investments
00:05:31
in the country and participating in the overall economic life of the country and
00:05:36
that's what we do on a daily basis at lgb and and I know that that rwanda has
00:05:43
risen very rapidly up the Ease of Doing Business Index and that's partly because
00:05:48
it's so easy to open a business and register a business in Rwanda correct it
00:05:53
is it is correct but more than that you see about 2008 it came to our attention that they are a number of international
00:06:05
best practices in facilitating businesses and we particularly picked the World Bank doing business report
00:06:13
that caught our attention at that time Rhonda was featuring about 140 fifth-place out of about one hundred and
00:06:23
eight hundred and ninety countries that are usually surveyed and we took it upon
00:06:27
ourselves to have every a reform agenda that would improve measuring ourselves against the best practices to aim at
00:06:38
getting among the top ten I'm very happy to from you Catherine that since then 2008
00:06:44
Rhonda has improved across the board from 145 to about 40 second as we are talking about today so tremendous
00:06:54
improvement but beyond that the reform agenda also captures many other issues that businesses are interested in that
00:07:00
help them become competitive and run profitable businesses some are captured by the World Economic Forum report some
00:07:09
are captured by the global profitability indices some are captured by Gallup polls some are captured by international
00:07:16
governance indices all of which add up together to form a very competitive business environment that we think today
00:07:26
is among the best that people particular business people should look at more favorably and I love this description
00:07:34
you've given us because it's so it's so typical of what I've observed in Rwanda
00:07:38
of having very specific goals very clear metrics you know a big vision and accomplishments to those and you know
00:07:47
the ease of doing business index is just one example of that approach it is but also that whole culture of having
00:07:55
targets and working towards them is one that permeates across the entire society
00:08:01
of our country in fact in the public sector and government in particular we have a process that we call amigo amigo
00:08:09
which loosely translates into being performance contracts where every institution of government management of
00:08:19
the institutions staff and and everyone must have a performance contract that first articulates what they aim to
00:08:29
achieve the resources that are required to achieve that and accountability associated with achieving that that is
00:08:36
what is helping us to achieve many of our targets that we set ourselves to right as you know we often bring Wharton
00:08:43
students MBA students to Rwanda and you know they're there astonished by live by
00:08:48
Emma he go and what it says about that the country's culture it's a very
00:08:52
important principle because even when people don't achieve that I guess they've set themselves that the
00:08:57
process that people go through aiming at achieving their targets however ambitious they may be is very important
00:09:04
and eventually also results into a culture that is results oriented yet I have to say that I'm not only the vice
00:09:12
dean for social impact at Wharton I'm a professor and I'm an organizational
00:09:16
psychologist and we know from abundant research the goal setting is hugely effective in motivating people in
00:09:23
improving performance and Rwanda does it remarkably well I want to shift the conversation a little bit to your role
00:09:29
in attracting foreign business foreign investors to Rwanda and explore with you what are your goals in that area and and
00:09:38
barriers and opportunities you are experiencing as you try to bring in as I said foreign business and investors to
00:09:45
Rwanda two goals we have since we're talking about goes alia one is to increase the the the component of our
00:09:56
gdp that is private sector investments every year we want to make sure that as the economy grows the role of the
00:10:05
private sector is not only growing but it's also significant significantly growing enough to take on a larger share
00:10:12
of our economy as you know when you're studying at a lower base in development
00:10:18
you have to have a lot of investments by the public sector sure in infrastructure
00:10:23
and education in health and others but with time we realize that it's very important that the private sector
00:10:30
continues to take on increasingly more raw so that's one the second one is we
00:10:35
realize the limitations of mobilizing domestic capital and also aim to increase the foreign direct investment
00:10:41
in the economy so that it can have that that push for takeoff as we aim to transform my con man so currently we aim
00:10:51
to reach over ten percent of our gdp as foreign direct investment by the 2020 we
00:11:01
aim to achieve over thirty percent of private sector investments into the economy by 2020
00:11:09
and those are targets that that inform what I do and every day with that then we translate into how much we want to
00:11:19
raise on an annual basis and we have got a target of growing private investment by a factor of twenty percent on an
00:11:27
annual basis to reach the kind of targets we have there we have set forth ambitious goals and and and can you
00:11:35
describe you know the successful elements the things that are attracting investment and and where you're finding
00:11:42
barriers so in what areas are you succeeding how are you succeeding and interacting investment and what are the
00:11:49
barriers you find in attracting investment in Rwanda in the private sector what I am finding is that our
00:11:56
biggest success actually comes as a silver lining around our challenges for example Rhonda is 12 million people but
00:12:09
within a larger environment of east african community of of 145 million people and so what previously had been
00:12:19
Cena the small economy has now become a large economy that is attracting businesses into Rwanda as a way to also
00:12:29
operate into the way the east african community so the market size and especially so it's more than just rollin
00:12:35
death row and as an entry point into a step into this toxic and communities of five countries in fact more than more
00:12:43
than that into the common market of eastern and southern africa with more than 400 million people that we are also
00:12:50
part of and so by making rhonda a core advocate of regional integration and also being seen to actually participate
00:13:01
actively in that we have expanded the market reach for any business that comes into and and that's building on what
00:13:07
would have been initially seen as a challenge of economy the second thing is as you are building our economy the core
00:13:15
infrastructure that is required for businesses to succeed like energy transport infrastructure education and
00:13:22
skill training and all those things that are critical for businesses to succeed have
00:13:28
become the core business sectors that we have seen businesses participate in my opening private universities private
00:13:37
companies going into training private companies going into infrastructure construction into energy generation and
00:13:44
so translating what previously could have been seen as disadvantages into business opportunities that are also
00:13:51
championing growth and on top of that so interesting right you're describing a
00:13:55
virtuous cycle of businesses investing to create businesses that grow that allow other businesses to grow
00:14:02
absolutely and that's how we see building competitiveness in the sense of when providing the kind of
00:14:09
infrastructure that is important for businesses to build on and then on that platform the businesses begin to access
00:14:17
the market and become profitability so as a result of these initial investments you are seeing other sectors emerging in
00:14:24
the financial services sector for example because of this wider market that are looking for a hub an area where
00:14:32
they can consolidate themselves and serviced away the region tourism because of the Peace and Security dividends you
00:14:39
have seen in our country and the region as a whole tourism continues to be the fastest growing sector in our economy in
00:14:48
fact this last year alone more than three hundred and five million dollars as a result of tourism making it the
00:14:57
largest export actually fought for our country and and so you're saying both
00:15:04
the foundational infrastructure for businesses turning into business opportunities that are making it
00:15:11
attractive for investors and on top of that having all these what we call the growth sectors of our economy also
00:15:18
growing quite significantly right so this sounds very very successful do you find that there are that for some
00:15:26
business leaders for some investors there's an issue of mindset that they think more of Rwanda as a place maybe to
00:15:33
visit or a place to help but not a place to come and do business or there do you
00:15:40
have to change people's mindset about Rwanda there is a perception issue over
00:15:46
all about the African economies about risk and a lot of what we see is risk as a perception rather than risk as real
00:15:56
risk of doing business and so there's an enormous amount of work that we put into
00:16:02
demonstrating that Rhonda is a place that you can do business and that you can realize your business growth
00:16:10
aspirations but you also realize that there are many people that see not just wonder about Africa as a place to help
00:16:20
especially this is true with many successful business people who high-net-worth have achieved certain
00:16:29
success in life and want to give back to society often attracted by the desire to
00:16:34
contribute and what we are saying to them is that this is very good because philanthropy is good and this desire to
00:16:40
help others and lift lives is very important but that we can actually do it using kind of hybrid business models
00:16:48
that you can help while you are creating employment and as a result contribute to
00:16:55
the sustainable growth of of the economy right sounds like you're talking about
00:16:59
impact investing and other strategies to grow business as a means of social impact I guess that's what you call it a
00:17:06
professor client because as a way of investing into into lives in two initiatives that will create impact in
00:17:16
people's lives while at the same time getting back the returns on the investments on commercial basis it is
00:17:25
very very good win-win situation for everyone absolutely yes so Francis a final question for you as we as you
00:17:34
reflect on on Rwanda is 21 years since the genocide what are you most proud of whether you as an individual you as a
00:17:43
head of our DB or just and over you as you think about the country what do you tell
00:17:47
what you're proud of the unity of purpose of the random people because you see it's not every society that has
00:17:57
suffered a genocide it's a devastating destructive experience that shatters a
00:18:05
society from its core to see a people come back together and have a common identity as London's and begin to aspire
00:18:19
for self-improvement as individuals to cater for their families and begin to invest in a long term and by so doing
00:18:28
collectively contribute to the rebirth of the nation that we are seeing as Rhonda I am extremely proud of that and
00:18:35
it's the single thing that I that I believe is really happening and changing
00:18:41
the story of Rhonda today great thank you so so much for being with us and i have to say personally as somebody who's
00:18:47
visited rwanda many times I've seen that spirit and that unity of purpose and it
00:18:52
is very very impressive and very inspiring so I'm so glad you could be with us today thank you very much thank
00:18:57
you thank you very much for having me you