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Rwanda's Economy: An Unlikely Success Story

Sep 16, 2012
Originally published on September 18, 2012 9:52 am

East Africa is a tough place to do business. Want to open shop in Kenya? Prepare for a month of paper work, surly officials and bribes. To the west, in Rwanda, it's a different story.

"Registering a business takes just a matter of hours. It no longer takes months, weeks, as it used to be," says Rwandan President Paul Kagame.

This year, Rwanda moved up seven spots on the World Economic Forum's competitiveness index to number 63 out of more than 140 countries. In recent years, it has posted average, annual GDP growth of more than 7 percent. The country's unlikely economic success can be traced back to its president.

Learning By Example

Stephen Kinzer, a former New York Times correspondent, recounts Kagame's radical experiment in his book, A Thousand Hills. He says Kagame transformed Rwanda by eliminating problems that have plagued other African economies.

"Kagame's concept was: 'If we can have a country that really works, everybody speaks English, the Internet is super fast, the airport is totally free of corruption, we can then lure to Rwanda all the companies and economic interests that are working in this entire region,' " Kinzer says.

Kagame brought in American agronomists to help boost Rwanda's low-quality coffee to super-premium grade. Famously, he also studied the strategies of East Asia's "Tiger" economies.

"We want to learn a lot from Singapore that has been very successful, that has turned a lot of challenges historically into a lot of opportunities," Kagame says. "It's about how they have invested in people, skills, technology, high-value products they have been able to put in the marketplace. So, it's our aspiration."

Tall, thin and angular, Kagame is a former rebel leader who dresses business casual and talks like a CEO. For instance, as apparel manufacturing leaves China because of rising labor costs, Kagame sees opportunity.

"I have seen some of these industries have shifted to Ethiopia," he says, "and in this case, they are producing high-end products from leather. In Rwanda, a similar situation can happen."

For all of Rwanda's recent success, most of its people are still poor subsistence farmers.

Governance In Question

Rights groups routinely blast Kagame for crushing critics at home and allegedly backing rebel forces abroad. Last week, a Human Rights Watch report said the Rwandan army is aiding a rebel group in the Democratic Republic of Congo called M23, which is accused of slaughtering civilians and raping women.

"None of these things are true," Kagame says.

Instead of blaming Rwanda, he says, people should focus on Congo's failure to control violence among its myriad rebel forces.

"Congo has very serious governance problems. It has institutions that don't function," he says.

When asked if he repudiates everything M23 is doing there, Kagame replies:

"Again, this is part of the problem. Before I even talk about repudiating anything M23 is doing, because I'm not a spokesman of M23, I even don't know why anyone would be asking me about M23. M23 is Congolese."

Kagame wraps up his second presidential term in 2017. The constitution bars him from a third. He has says he won't run again, but when pressed, he's coy.

In the long run, though, the big question for Rwanda is this: Can the country's grand experiment live on beyond the rule of its creator?

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

STEVE INSKEEP, HOST:

For years now, Asian economies have been the leaders in economic growth. But a recent study by the International Monetary Fund forecasts that in the next five years, seven of the 10 fastest-growing economies in the world will be in sub-Saharan Africa. Leading the way is a tiny East African country better known for its 1994 genocide - Rwanda.

NPR's Frank Langfitt spoke with Rwanda's president, Paul Kagame, last week at the World Economic Forum in China, about his country's unlikely success story.

FRANK LANGFITT, BYLINE: East Africa is a tough place to do business. Want to open shop in Kenya? Prepare for a month of paperwork, surly officials and bribes. To the west, in President Kagame's Rwanda, it's a different story.

PRESIDENT PAUL KAGAME: Registering a business takes just a matter of hours. It no longer takes months, weeks; as it used to be.

LANGFITT: This year, Rwanda moved up seven spots on the World Economic Forum's competitiveness index, to number 63. It's out of more than 140 countries.Stephen Kinzer is the author of "A Thousand Hills," which recounts Kagame's radical experiment. He says Kagame transformed Rwanda by eliminating problems that have plagued other African economies.

STEPHEN KINZER: Kagame's concept was, if we can have a country that really worked - everybody speaks English; the Internet is super-fast; the airport is totally free of corruption - we can then lure to Rwanda all the companies, and economic interests, that are working in this entire region.

LANGFITT: Kagame brought in American agronomists to help boost Rwanda's low-quality coffee to super-premium grade. And famously, he studied the strategies of East Asia's tiger economies.

KAGAME: We want to learn a lot from the - Singapore, that has been very successful; that has turned a lot of challenges historically, into a lot of opportunities. It's about how they have invested in people, in skills, in technology, high-value products that they have been able to put in the marketplace. So, it's our aspiration.

LANGFITT: Tall, thin and angular, Kagame is a former rebel leader who dresses business casual, and talks like a CEO. For instance, as apparel manufacturing leaves China because of rising labor costs, Kagame sees opportunity.

KAGAME: I have seen some of these industries - has shifted, say, to Ethiopia. And in this case, they are producing high-end products from leather. In Rwanda, a similar situation can happen.

LANGFITT: For all of Rwanda's recent success, most of its people are still poor, subsistence farmers. And rights groups routinely blast Kagame for crushing critics at home, and allegedly backing rebel forces abroad. Last week, a Human Rights Watch report said the Rwandan army is aiding a rebel group in the Democratic Republic of Congo - called M23, which is accused of slaughtering civilians and raping women.

KAGAME: None of these things are true.

LANGFITT: Instead of blaming Rwanda, Kagame says people should focus on Congo's failure to control violence among its myriad rebel groups.

KAGAME: Congo has very serious governance problem; does - institutions that don't function.

LANGFITT: Do you repudiate everything M23 is doing there?

KAGAME: You see - again, this is part of the problem. Before I even talk about repudiation of anything M23 is doing - because I'm not a spokesman of M23. I even don't know why anybody would be asking me about M23. M23 is Congolese.

LANGFITT: Kagame wraps up his second presidential term in 2017. The constitution bars him from a third, and he's said he won't run again. But when I pressed him, he was coy. In the long run, though, the big question for Rwanda is this: Can the country's grand experiment live on, beyond the rule of its creator?

Frank Langfitt, NPR News, Shanghai. Transcript provided by NPR, Copyright NPR.