THE DIVA THE DIVA July - Sep 2012 July - Sep 20122 3

MINEAC

29ISSUE N0 22 - JUNE 2012 HOPE MAGAZINE28 HOPE MAGAZINE ISSUE N0 22 - JUNE 2012

implemented to enhance the Centre’s role in easing the permit obtaining process.The new reforms to affect the process of obtaining construction permits were at two levels, the city and district levels with each level having specific roles to play for different groups of applicants.Reforms at the city level included merging the functions of various desks into one, Establishment of Management Informa-tion Systems (MIS), costs for Deed plan and Construction Permit will be reduced by 30% and Introduction of Risk-based approaches to bullet proof against shoddy construction.The Kigali Construction One Stop Cen-tre handles specifically commercial units involving heavy construction investments such as commercial multi- households residential houses (living or office apart-ments), Social structures such as schools, hospitals and churches and industrial construction--factories, industries, ware-houses, and other workshops.At district level, operations have been streamlined by introducing a central reg-istry with Ghant Charts to receive and process applications for small and mid size projects on the basis of first come first served.

The new reforms, including the newest of applying for permits on-line, will, without a doubt, be captured in the 2013 report giving Rwanda strong hopes to improve from last year’s ranking.

Getting ElectricityRwanda remains the easiest EAC country to get connected to the national electricity grid. Easy connection to electricity is vital in attract-ing major investments and Rwanda is the 50th best country in the world in as far as easing access to electricity by investors is concerned. Investors seeking to set up business in Rwan-da today do not have to chase for power con-nection on their own. Instead, officials of the Kigali City Construction One-Stop Center will do it for them.All that the investor has to do is to indicate on his or her application form for a construction permit that they want to have electricity con-nected to their site. “The rest of the work will be done by us. It is the one-stop center that takes up the issue with the Electricity, Water and Sanitation Authority (EWSA),” says a se-nior official of the center.In order to ensure that the process flows smoothly, EWSA has designated an officer as its focal point at the Kigali City Construction

One-Stop Center to coordinate all activities related to electricity connections for investors.“We cannot ask investors to go and find power connections by themselves. Some investors are new in the country and do not know where to find EWSA,” the official adds.Because electricity connection is applied for concurrently with the construction permit, it takes approximately 30 working days for the investor to be handed complete documenta-tion.Costs of accessing electricity have been re-duced from 30% to 20% to the client who re-quests EWSA to purchase equipments on their behalf and from 30% to 15% to the clients who purchase the equipments themselves.The government has continued to address the issue intermittence of power supply. With funding from World Bank’s International De-velopment Association (IDA) a new 21 MW Ja-bana heavy fuel oil power plant has been built. Under the same funding, the power transmis-sion infra¬structure around Kigali City has been overhauled and a new main substation added to improve the city sub-transmission system.The project code-named “Urgent Electricity Rehabilitation Project (UERP),” the govern-ment has managed to improve power sup¬ply and eliminate load shedding from about 50 percent at peak hours in 2004 to zero per¬cent presently. Other interventions have been in rolling out access to more areas under the Electricity Ac-cess Roll-out Program (EARP) by the govern-ment and the World Bank.According to officials of EWSA, this project is one of the strategic objectives of the Eco-nomic Development and Poverty Reduction Strategy that aims at expanding electricity ac-cess to investors all over the country. This, in way, brings in the loop medium investors who intend to open the countryside to the process-ing facilities.Besides, investors in banking and telecommu-nication sectors who are rolling out services to remote areas outside Kigali City are able to find the necessary infra¬structure such as power.The program has a five-year strategic target to increase the electrification rate in the coun-try from the current 9% to 16% by connecting more than 300,000 new consumers – both do-mestic and industrial.

Registering PropertyFlexibility with which a business entity or an individual can acquire, register and transfer ownership of all types of property is important for growth of business and the economy in general.To ensure this swiftness, one of the reforms has been to remove the Tax clearance certificate

which was formerly a requirement for prop-erty transfer.Land administration information system (LAIS) was implemented. This is a set of systems or processes of deter-mining, recording and disseminating infor-mation about the ownership of land in order to make all land tenure rules operational. This reform has enabled daily land trans-actions to be made in a very cost effective manner in terms of time, procedures and in a more transparent and effective way.Since land is a constant commodity that can only get scarce as the population grows, the Organic Law of 2005 that put land under the ownership of public entities such as the state, cities and districts from who business and individuals can lease for up to 99 years makes it easier for investors to apply for and get land without much of a hassle as the Government can even help some to identify

reward ‘good’ borrowers, the Rwanda Devel-opment Board together with BNR and Credit Reference Bureau Africa Ltd has created an intervention mechanism that allows for easy access to credit by both individuals and en-terprises.Paul Pavlidis is the CEO of Credit Reference Bureau Africa Ltd. “We do not manufacture data, but we man¬age it. This information is updated from the subscribers’ databases on a monthly basis to make it relevant. On re-quest from the subscribers, who are currently the banks and mi-cro-finance institutions and with the consent of the prospective borrow-er, this data spells out the borrowing history and can be provided online in less than two minutes,” Pavlidis explains.Currently, all commercial banks and 30 mi-cro-finance institutions are subscribers with the CRBAfrica. Given the geographical dispersal of MFIs in

antee fund.Désiré Rumanyika, CEO of the Business Development Fund says the agriculture guarantee fund targets projects related to the entire agricultural value chain while the SME fund is for all other sectors, and the only condition is that the business should be productive and adding value.For instance for agricultural projects, BDF can provide a guarantee of up to Rwf 500 million, while for other SMEs the maximum amount is Rwf 150 million.A 50% fee has also been put in place set-ting a provision in movable assets like trad-ing stock (inventory of stock of harvested cereals, cash crops, Animals and livestock in groups including cows, goats, rabbits, pigs, horses, sheep and poultry, Vehicles and Motor vehicles (tracks, cars, motorcy-cles) aircraft and ships, Plant and machin-ery. This means, with moveable assets, an in-vestor, especially youthful entrepreneurs who make up majority of the population, can easily access funds.

Protecting InvestorsRwanda is fast becoming a hub for foreign investments. Last year, total investments amounted to over US$600 million.However, when investors come, efforts must be put in place to retain them and this involves many measures.Because the World Bank looks at how in-vestors (shareholders) are protected in a company, deliberate measures have been put in place to actually reform laws relating to organizations. On a general outlook, investors’ money is also protected by a strict regulatory role played by the Capital Markets Authority which has become well established since its launch. There are two local companies listed on the stock market of Rwanda and two others cross listed on the Kenya and Rwanda stock Market. The role of RCMA is to ensure investors don’t lose money by buying shares in phony companies.

“That’s why even after four years we only have two locally listed companies. About fifteen are on the list to go public in the next three years but we demand strict qual-ifications and procedures to fulfill before being allowed on the market,” said Charles Furaha, the Legal & corporate manager at the Rwanda capital markets authority.Other reforms such as the establishment of the Kigali international arbitration centre will also play multi-role including protect-ing investors. For instance, most interna-tional investors are not comfortable with

space for projects.With these reforms, it takes a minimum of 60 days to register property in Rwanda, a remarkable achievement considering that it took 371 days in 2007.

Getting CreditAccording to the National Bank of Rwanda, ten years ago non-performing loans (NPLs) made up 40% of all credit given out, an in-dication that Rwanda’s financial sector was characterized by very high credit risk.To¬day, NPLs have dropped to 12%, even though the ideal level for a thriving financial sector is 5%.In order to give banks more confidence, and

both rural and urban cen-ters, the culture of borrowing and loan servicing is steadily get-ting entrenched, permeating to all parts of the country. This is a strong impetus in the Doing Busi-ness environment, as it ensures a sustain-able growth of SMEs and a steady or even a growing purchasing power. The Business Development Fund (BDF) has been created by the Rwandan Development Bank (BRD) to help SMEs access to funding for setting up or expanding a business.Under this reform, BDF’s mission is to pro-vide guarantees so that people with good business plans can access loans from com-mercial banks. BDF has two funds: the ag-riculture guarantee fund and the SME guar-

“We cannot ask investors to go and find pow¬er connec-tions by themselves. Some investors are new in the country and do not know where to find EWSA,” the official adds. Be-cause electricity connection is applied for concurrently with the construction permit, it takes approximately 30 working days for the investor to be handed complete documentation.

www.hope-mag.com www.hope-mag.com

29ISSUE N0 22 - JUNE 2012 HOPE MAGAZINE28 HOPE MAGAZINE ISSUE N0 22 - JUNE 2012

implemented to enhance the Centre’s role in easing the permit obtaining process.The new reforms to affect the process of obtaining construction permits were at two levels, the city and district levels with each level having specific roles to play for different groups of applicants.Reforms at the city level included merging the functions of various desks into one, Establishment of Management Informa-tion Systems (MIS), costs for Deed plan and Construction Permit will be reduced by 30% and Introduction of Risk-based approaches to bullet proof against shoddy construction.The Kigali Construction One Stop Cen-tre handles specifically commercial units involving heavy construction investments such as commercial multi- households residential houses (living or office apart-ments), Social structures such as schools, hospitals and churches and industrial construction--factories, industries, ware-houses, and other workshops.At district level, operations have been streamlined by introducing a central reg-istry with Ghant Charts to receive and process applications for small and mid size projects on the basis of first come first served.

The new reforms, including the newest of applying for permits on-line, will, without a doubt, be captured in the 2013 report giving Rwanda strong hopes to improve from last year’s ranking.

Getting ElectricityRwanda remains the easiest EAC country to get connected to the national electricity grid. Easy connection to electricity is vital in attract-ing major investments and Rwanda is the 50th best country in the world in as far as easing access to electricity by investors is concerned. Investors seeking to set up business in Rwan-da today do not have to chase for power con-nection on their own. Instead, officials of the Kigali City Construction One-Stop Center will do it for them.All that the investor has to do is to indicate on his or her application form for a construction permit that they want to have electricity con-nected to their site. “The rest of the work will be done by us. It is the one-stop center that takes up the issue with the Electricity, Water and Sanitation Authority (EWSA),” says a se-nior official of the center.In order to ensure that the process flows smoothly, EWSA has designated an officer as its focal point at the Kigali City Construction

One-Stop Center to coordinate all activities related to electricity connections for investors.“We cannot ask investors to go and find power connections by themselves. Some investors are new in the country and do not know where to find EWSA,” the official adds.Because electricity connection is applied for concurrently with the construction permit, it takes approximately 30 working days for the investor to be handed complete documenta-tion.Costs of accessing electricity have been re-duced from 30% to 20% to the client who re-quests EWSA to purchase equipments on their behalf and from 30% to 15% to the clients who purchase the equipments themselves.The government has continued to address the issue intermittence of power supply. With funding from World Bank’s International De-velopment Association (IDA) a new 21 MW Ja-bana heavy fuel oil power plant has been built. Under the same funding, the power transmis-sion infra¬structure around Kigali City has been overhauled and a new main substation added to improve the city sub-transmission system.The project code-named “Urgent Electricity Rehabilitation Project (UERP),” the govern-ment has managed to improve power sup¬ply and eliminate load shedding from about 50 percent at peak hours in 2004 to zero per¬cent presently. Other interventions have been in rolling out access to more areas under the Electricity Ac-cess Roll-out Program (EARP) by the govern-ment and the World Bank.According to officials of EWSA, this project is one of the strategic objectives of the Eco-nomic Development and Poverty Reduction Strategy that aims at expanding electricity ac-cess to investors all over the country. This, in way, brings in the loop medium investors who intend to open the countryside to the process-ing facilities.Besides, investors in banking and telecommu-nication sectors who are rolling out services to remote areas outside Kigali City are able to find the necessary infra¬structure such as power.The program has a five-year strategic target to increase the electrification rate in the coun-try from the current 9% to 16% by connecting more than 300,000 new consumers – both do-mestic and industrial.

Registering PropertyFlexibility with which a business entity or an individual can acquire, register and transfer ownership of all types of property is important for growth of business and the economy in general.To ensure this swiftness, one of the reforms has been to remove the Tax clearance certificate

which was formerly a requirement for prop-erty transfer.Land administration information system (LAIS) was implemented. This is a set of systems or processes of deter-mining, recording and disseminating infor-mation about the ownership of land in order to make all land tenure rules operational. This reform has enabled daily land trans-actions to be made in a very cost effective manner in terms of time, procedures and in a more transparent and effective way.Since land is a constant commodity that can only get scarce as the population grows, the Organic Law of 2005 that put land under the ownership of public entities such as the state, cities and districts from who business and individuals can lease for up to 99 years makes it easier for investors to apply for and get land without much of a hassle as the Government can even help some to identify

reward ‘good’ borrowers, the Rwanda Devel-opment Board together with BNR and Credit Reference Bureau Africa Ltd has created an intervention mechanism that allows for easy access to credit by both individuals and en-terprises.Paul Pavlidis is the CEO of Credit Reference Bureau Africa Ltd. “We do not manufacture data, but we man¬age it. This information is updated from the subscribers’ databases on a monthly basis to make it relevant. On re-quest from the subscribers, who are currently the banks and mi-cro-finance institutions and with the consent of the prospective borrow-er, this data spells out the borrowing history and can be provided online in less than two minutes,” Pavlidis explains.Currently, all commercial banks and 30 mi-cro-finance institutions are subscribers with the CRBAfrica. Given the geographical dispersal of MFIs in

antee fund.Désiré Rumanyika, CEO of the Business Development Fund says the agriculture guarantee fund targets projects related to the entire agricultural value chain while the SME fund is for all other sectors, and the only condition is that the business should be productive and adding value.For instance for agricultural projects, BDF can provide a guarantee of up to Rwf 500 million, while for other SMEs the maximum amount is Rwf 150 million.A 50% fee has also been put in place set-ting a provision in movable assets like trad-ing stock (inventory of stock of harvested cereals, cash crops, Animals and livestock in groups including cows, goats, rabbits, pigs, horses, sheep and poultry, Vehicles and Motor vehicles (tracks, cars, motorcy-cles) aircraft and ships, Plant and machin-ery. This means, with moveable assets, an in-vestor, especially youthful entrepreneurs who make up majority of the population, can easily access funds.

Protecting InvestorsRwanda is fast becoming a hub for foreign investments. Last year, total investments amounted to over US$600 million.However, when investors come, efforts must be put in place to retain them and this involves many measures.Because the World Bank looks at how in-vestors (shareholders) are protected in a company, deliberate measures have been put in place to actually reform laws relating to organizations. On a general outlook, investors’ money is also protected by a strict regulatory role played by the Capital Markets Authority which has become well established since its launch. There are two local companies listed on the stock market of Rwanda and two others cross listed on the Kenya and Rwanda stock Market. The role of RCMA is to ensure investors don’t lose money by buying shares in phony companies.

“That’s why even after four years we only have two locally listed companies. About fifteen are on the list to go public in the next three years but we demand strict qual-ifications and procedures to fulfill before being allowed on the market,” said Charles Furaha, the Legal & corporate manager at the Rwanda capital markets authority.Other reforms such as the establishment of the Kigali international arbitration centre will also play multi-role including protect-ing investors. For instance, most interna-tional investors are not comfortable with

space for projects.With these reforms, it takes a minimum of 60 days to register property in Rwanda, a remarkable achievement considering that it took 371 days in 2007.

Getting CreditAccording to the National Bank of Rwanda, ten years ago non-performing loans (NPLs) made up 40% of all credit given out, an in-dication that Rwanda’s financial sector was characterized by very high credit risk.To¬day, NPLs have dropped to 12%, even though the ideal level for a thriving financial sector is 5%.In order to give banks more confidence, and

both rural and urban cen-ters, the culture of borrowing and loan servicing is steadily get-ting entrenched, permeating to all parts of the country. This is a strong impetus in the Doing Busi-ness environment, as it ensures a sustain-able growth of SMEs and a steady or even a growing purchasing power. The Business Development Fund (BDF) has been created by the Rwandan Development Bank (BRD) to help SMEs access to funding for setting up or expanding a business.Under this reform, BDF’s mission is to pro-vide guarantees so that people with good business plans can access loans from com-mercial banks. BDF has two funds: the ag-riculture guarantee fund and the SME guar-

“We cannot ask investors to go and find pow¬er connec-tions by themselves. Some investors are new in the country and do not know where to find EWSA,” the official adds. Be-cause electricity connection is applied for concurrently with the construction permit, it takes approximately 30 working days for the investor to be handed complete documentation.

www.hope-mag.com www.hope-mag.com

THE DIVA July - Sep 201254