Rwanda leads the way in demonstrating how ICT can fund development

Access to knowledge, information and technology will play an increasingly important role in the more efficient delivery of services, in entrepreneurship and the creation of small businesses in emerging countries.

Given the importance of broadband in achieving sustainable development and the transformational impact of broadband on people’s lives and global economies, the roll-out of high-speed information and communication technology (ICT) should be an urgent priority in every country’s sustainable development strategy in order to achieve the United Nation’s Sustainable Development goals (SDGs). However, very few emerging countries have realised this and set themselves securely on the path to sustainable development.  While some challenges persist, investments in ICTs must remain a priority given the cross-cutting nature of the sector.  Investment in ICT means indirect investment in other sectors too.

One country that has proved the exception to the rule is Rwanda, under the leadership of President Paul Kagame which has made enormous progress in the communications sector, extending Internet accessibility, improving infrastructure and integrating ICTs as well as prioritising e-Health and digital literacy initiatives.  Rwanda has transformed into a nation that is progressing rapidly towards its ambitious vision for socio-economic development, peace and reconciliation.

The Rwandan government’s progressive plans to transform Rwanda into a regional high-tech hub led to the initiation of the five-year “National Information and Communication Technology (ICT) Plans” The first plan (2000 to 2005) focused on creating policies favourable to ICT initiatives.  The second (2006 to 2010) concentrated on building the ICT backbone, including laying fibre optic cables.  The third, scheduled to run from 2011 to 2015, will speed up the introduction of services to exploit the new technology and the Rwandan authorities are convinced, will push Rwanda ahead of regional rivals.

I believe the third phase will strengthen skills-training centres and develop a culture of ICT in schools as a means of creating “a critical mass of IT professionals.”  Early this year the Rwanda Information Technology Authority announced that it had completed a nationwide 2,300-kilometre fibre-optic cable.  The network connects Rwanda to the outside world by means of the Seacom undersea cable along the east coast of Africa.  It provides fast Internet access to a wider range of broadband services, replacing expensive and slower satellite connections.

Perhaps most importantly, in my view, is the way the Rwandan government has gone ahead with fostering ICT systematically and step-by-step from as early as 2000—always putting ICT at the centre of the country’s development agenda and slowly but surely building the ecosystem to sustain these efforts into the future. This has meant that now, the Rwandan people are starting to reap the benefits of this choice and are well set on the path to sustainable development.  The inflows of foreign direct investment have leapfrogged almost 15-fold between 2005 and 2009 from USD 8 million to USD 118.7 million (World Bank) which also augurs well for the future.

In this year’s “Ease of Doing Business” rankings—by means of which the World Bank gauges the intricacies of running a company in different countries, Rwanda was ranked 58 out of 183 nations surveyed—up from 143 in 2009.  In Africa, only Mauritius, South Africa, Botswana and Tunisia fared better—a tremendous improvement.  The World Bank says that a high ranking indicates that a country has adopted laws conducive to starting up and operating a company, in areas such as accessing credit, registering property transfers, paying taxes and enforcing contracts.  Today in Rwanda it takes only two procedures in three days to start up a business at a cost of 8.9% of income per capita whereas in 2005 it took nine procedures at a cost of 223% of income per capita.

Empowering its people and growing the economy is very high on Rwanda’s agenda for development.  The plan to transition to a cashless economy is a key element of this agenda.  By promoting electronic payment methods, the government hopes to achieve 80% financial inclusion by 2017.  Rwanda’s unbanked citizens will thus be included in the country’s formal economy by allowing them access to financial services.  In this way the informal economy in the country can be reduced and the government and other institutions will have a more cost-effective, efficient, transparent, and safe means of making and collecting payments at their disposal.

Mobile money powers mobile penetration

Mobile money is an electronic payment method that has been widely used in the country for some time.  However, electronic payment methods (mobile money platforms or electronic sales-recording devices) must be subjected to strict regulations and supervision—they are particularly vulnerable to money laundering and fraud. The Rwanda Utility Regulatory Agency (RURA) is using the International Gateway Traffic Verification System (IGTVS), a joint initiative between RURA and Global Voice Group (GVG) which allows the RURA to audit and monitor the Rwandan networks independently and transparently, and for a number of purposes:

• accurate billing
• traffic measurement
• quality of service assessment
• market surveillance
• interconnection dispute resolution
• fraud management

The IGTVS has brought a proactive approach to regulation based on ICT tools and real-time data collection and has generated significant additional revenue for both the State and the local operators.  The RURA can now intervene effectively in two key areas: the elimination of fraudulent grey traffic and the overall improvement of the quality of service.

Generally speaking, African countries need to utilise their technology sectors better to fund their own development—Rwanda has shown that there are so many benefits to doing so. While there will always be some leaders that are more visionary than others, Rwanda is leading the pack when it comes to harnessing its ICT sector.  Through the judicious use of ICT, Rwanda is transforming what was essentially an agrarian society into a knowledge-based economy.  Other African countries could follow Rwanda’s example and capitalise on the momentum.

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About the Author

Angela is a communications consultant and writer for media.  Her passion is to write about solutions on how African countries can stimulate their economies through the use of innovative finance and cutting edge technology.