Guidance

Doing business in Rwanda: Rwanda trade and export guide

Updated 1 July 2015

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Find out how UK companies can control risks when doing business in Rwanda.

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1. Rwanda export overview

Rwanda is a landlocked country that borders with Uganda, Burundi, Tanzania and the Democratic Republic of the Congo. It has a population of approximately 10 million.

Contact a Department for Business and Trade (DBT) Rwanda export adviser for a free consultation if you’re interested in exporting to Rwanda.

Contact UK Export Finance (UKEF) about trade finance and insurance cover for UK companies. You can also check the current UKEF cover position for Rwanda.

Rwanda is a member of the East Africa Community (EAC) and the Common Market for Eastern and Southern Africa (COMESA). It is also a member of the Commonwealth.

Many UK companies operate in Rwanda, including De La Rue, Fusion Capital, Pfunda, Gisovu and Regus.

Benefits for British businesses exporting to Rwanda include:

• liberalised economy – government commitment to the private sector
• history of macro-economic stability
• low cost workforce
• attractive investment policies
• political stability since 1994
• relatively low corruption levels (55 out of 175 in the Corruption Perceptions Index)

2. Challenges doing business in Rwanda

There are some unique challenges when doing business in Rwanda. These include:

• relatively poor infrastructure
• cost and availability of electricity

3. Growth potential

Between 2001 and 2012, Gross Domestic Product (GDP) growth averaged 8%. It is forecast to increase to 6.5% in 2015/6. Rwanda has an impressive record of macro-economic stability with single digit inflation.

Fitch’s credit rating improved to B.

Rwanda was ranked 46th in the World Bank’s Ease of Doing Business Index, the third country in Africa after Mauritius and South Africa.

Rwanda’s ‘Vision 2020’ development strategy aims to transform the country from a low income agricultural based economy to a service orientated economy. There are also plans to reduce non-tariff barriers.

3.1 Foreign Direct Investment (FDI)

Rwanda received USD 1 billion in FDI in 2013, up from USD 106 million in 2011.

4. UK and Rwanda trade

Bilateral trade in goods between the UK and Rwanda exceeded £10 million in 2012. UK exports to Rwanda totalled £7 million.

Top UK exports to Rwanda include:

• power generating machinery
• medicinal and pharmaceutical products
• general industrial machinery

5. Opportunities for UK businesses in Rwanda

Department for Business and Trade (DBT) provides free international export sales leads from its worldwide network. Search for export opportunities.

5.1 Agriculture

The economy is still dominated by agriculture, which contributes 32% of GDP and employs 80% of the population.

The government priority is to move from subsistence to commercial agriculture, in order to boost exports.

Contact the British High Commission for more information on this sector.

5.2 Energy

Wood is Rwanda’s main source of power. As part of its plans to increase the contribution of renewable energy, Rwanda is developing its hydro and methane gas potential.

Electricity coverage and supply is uneven and unreliable. There are ambitious plans under ‘Vision 2020’ to expand the grid.

Contact the British High Commission for more information on this sector.

5.3 Infrastructure

Along with Uganda and Kenya, construction is planned for a standard gauge railway to connect with Kenyan ports. Rwanda is also planning to upgrade main arterial roads.

Kigali international airport is undergoing an upgrade and a new airport is planned 40 kilometres out of Kigali in the eastern province.

Contact the British High Commission for more information on this sector.

5.4 Information and Computer Technology (ICT)

Rwanda is promoting a progressive ICT sector as part of a strategy to become a ‘tech hub’.

It has laid fibre optic broadband cables across the country. It recently announced a project for the completion of the last stage of this installation – installing Wi-Fi in public areas and introducing 4G.

Contact the British High Commission for more information on this sector.

5.5 Finance and business services

Rwanda’s finance sector consists of several local and regional banks. ‘Microfinance’ institutions dominate the market and domestic finance is expensive.

Mobile banking is fast growing and competitive. There is potential for the expansion of the business services sector.

Contact the British High Commission for more information on this sector.

5.6 Mining

Production is mostly artisan, but the government is encouraging commercial investment in mines to upscale production. There are regulation challenges, although a new mining law was recently introduced to help.

The main areas for mining are:

• tin
• coltan
• tungsten
• gold
• diamonds
• topaz
• sapphires

Contact the British High Commission for more information on this sector.

6. Start-up considerations

A UK business enterprise in Rwanda can be operated as a:

• company
• foreign branch
• joint venture

You can consider employing an agent or distributor.

The Rwanda Development Board (RDB) can provide help with setting up and registering a company in Rwanda.

The British High Commission in Kigali can put you in touch with legal professionals who give advice to British businesses looking to export.

7. Legal considerations

Rwanda has a dual legal system (civil and common) but it is gradually transiting to a common law based system. Specialised commercial courts began operations in 2008 and have largely cleared a substantial backlog of cases.

In 2008, the government implemented business reform legislation, which included new bankruptcy regulations and arbitration laws.

7.1 Intellectual Property

In 2009 Rwanda approved a new Intellectual Property law. A company law also adopted in 2009 strengthened investor protections by requiring greater corporate disclosure. This increased the liability of directors and improved shareholders’ access to information.

8. Tax and customs considerations

In 2011, Rwanda reformed its tax payment processes and enacted additional laws on insolvency and arbitration. These laws were designed to facilitate international business and to further improve the investment climate.

8.1 Tax

Value Added Tax (VAT) is currently set at 18%.

8.2 Corporate tax

Corporate tax in Rwanda is set at 30%.

There are some discounts for registered investors. Discounts are based on the number of employees and the amount of income derived from export.

Personal income tax rates in Rwanda are progressive to 30%.

Non-residents are taxed only on Rwandan-source income. An individual is resident in Rwanda if he/she stays in Rwanda for more than 183 days in a 12 month period. Rwandan residents are taxed on world-wide income.

8.3 Customs

In line with the East African Customs Union (EACU) agreement, Rwanda has adopted a 3 band duty structure for imports from outside of the EAC.

The 3 bands are:

• finished products (25%)
• intermediate products (10%)
• raw materials (0%)

9. Entry requirements

You need a visa to enter Rwanda.

9.1 Travel advice

If you’re travelling to Rwanda for business, check the Foreign and Commonwealth Office (FCO) travel advice page beforehand.

10. Contacts

Rwanda has no Department for Business and Trade (DBT) representation so the British High Commission can’t provide the full range of Department for Business and Trade (DBT) services. However, it is ready to assist UK businesses wherever it can.