2023 Investment Climate Statements: Rwanda

Policies Towards Foreign Direct Investment

Over the past decade, the GOR undertook a series of policy reforms intended to improve the investment climate, wean Rwanda’s economy off foreign assistance, and increase FDI levels. Rwanda enjoyed strong economic growth until the start of the COVID-19 pandemic in March 2020, averaging 7.1 percent annual GDP growth over the prior decade. Rwanda also enjoys a reputation for low corruption. In 2020, Rwanda experienced a 3.4 percent GDP contraction, marking its first recession since the 1994 genocide. Rwanda’s economy is now showing signs of recovery, as GDP grew 8.2 percent in 2022.

The Rwanda Development Board (RDB)  was established in 2006 to fast-track investment projects by integrating all government agencies responsible for the entire investor experience under one roof. This includes key agencies responsible for business registration, investment promotion, environmental compliance clearances, export promotion, and other necessary approvals. New investors can register online at the RDB website and receive a certificate in a few days, and the agency’s “One-Stop Shop” helps investors secure required approvals, certificates, and work permits. In February 2023, the GOR decided to move all remaining business and investment licensing to the RDB’s “expanded one-stop shop.”

In February 2021, Rwanda made significant changes to the Investment Code to address previous investor complaints and included new incentives to attract investments in strategic growth sectors, which include 1) export; 2) manufacturing including textiles and apparel, electronics, information communication and technology equipment, large scale agricultural operations excluding coffee and tea, pharmaceuticals, processing in wood, glass and ceramics, processing and value addition in mining, agricultural equipment and other related industries that fall in these categories; 3) energy generation, transmission and distribution; 4) information and communication technologies, business process outsourcing and financial services; 5) mining activities relating to mineral exploration; 6) transport, logistics and electric mobility; 7) construction or operations of specialized innovation parks or specialized industrial parks; 8) affordable housing; 9) tourism, which includes hotels, adventure tourism and agro-tourism; 10) horticulture and cultivation of other high-value plants; 11) creative arts in the subsector of the film industry; and 12) skills development in areas where the country has limited skills and capacity.

Since 2020, the GOR created the Rwanda Financial Intelligence Centre (FIC), passed an anti-money laundering and counter-terrorism financing law, and passed a law on mutual legal assistance in criminal matters to fully criminalize money laundering and terrorism financing and align the country with OECD rules. The GOR also amended the Company Act and passed a law on partnerships to allow professional service providers to register as partners rather than limited liability companies.
Rwanda’s October 2021 data privacy law (“The Law Relating to the Protection of Personal Data and Privacy”) is modeled on EU and U.S. data protection laws. The law is designed to increase consumer protections, especially as Rwanda seeks to become an ICT and innovation hub. According to some private sector firms, the regulatory burden introduced by the law poses a financial challenge for businesses. The law, which goes into effect October 2023, provides individuals explicit rights over their data, such as the right to withdraw consent for data usage at any time. Companies are obligated to have stricter controls over data handling. These additional burdens will increase compliance and operating costs for many businesses. Rwanda’s National Cyber Security Authority (NCSA) offered a two-year grace period from October 2021 to October 2023 to businesses prior to enforcement of non-compliance penalties.

Several investors noted tax policy implementation is a top concern affecting their operations in Rwanda. Investors cited instances in which tax incentives and deals negotiated with RDB and line ministries were interpreted differently by the Rwanda Revenue Authority (RRA). Several investors reported their initial tax incentive packages were well-respected by all government agencies, including the RRA, but later attempts to expand the business or scale up faced significant obstacles when some of the investment incentives were changed or no longer honored. Officials at RRA recognized these gaps but stated investors were welcome to work with them to resolve tax disputes. RRA officials added the RRA’s supervisory ministry, the Ministry of Finance and Economic Planning (MINECOFIN), was often called upon to resolve line ministries’ divergent interpretations of tax policy.

Under Rwandan law, foreign firms should receive equal treatment regarding taxes and equal access to licenses, approvals, and procurement. Foreign firms should receive value added tax (VAT) rebates within 15 days of receipt by the RRA, but firms complained the process for reimbursement can take months and occasionally years. Refunds can be further delayed pending the results of RRA audits. A few investors cited punitive retroactive fines arising from indefinite audits which took years to complete. RRA aggressively enforces tax requirements and imposes penalties for errors – deliberate or not – in tax payments. Investors added lack of coordination among ministries, agencies, and local government authorities (for example, district-level officials) led to inconsistencies in implementation of promised incentives. Others pointed to a lack of clarity on who the regulating entity is on certain matters.

Limits on Foreign Control and Right to Private Ownership and Establishment

Rwanda has neither statutory limits on foreign ownership or control nor any official economic or industrial strategy that discriminates against foreign investors. Local and foreign investors have the right to own and establish business enterprises in all forms of remunerative activity.

Foreign nationals may hold shares in locally incorporated companies. The GOR has continued to privatize state holdings, though the government (including the military) and ruling party continue to play a dominant role in Rwanda’s private sector. Under the 2021 land law, foreign investors can acquire real estate subject to a general limit on land ownership. Some foreign investors expressed fear implementation of the land law would pose new barriers to investment and/or place existing investments at risk due to the law’s requirements for foreign investors to acquire investment certificates. The land law may prevent investors from developing already acquired land in line with their initial plans. Several investors mentioned their properties were rezoned without prior consultation, causing significant losses and delays while they went through the rezoning process. Freehold is granted only to Rwandan citizens for properties of no more than two hectares but may also be granted to foreigners for properties in designated Special Economic Zones or through a Presidential Order for exceptional circumstances of strategic national interests. Long-term leases (emphyteutic leases) in residential and commercial areas are available to both citizens and foreigners acquiring land through private means. These leases typically last 99 years and are renewable. Foreign investors can also acquire land through concessional agreements to use government private land. Such agreements cannot exceed 99 years but can be renewed.

Other Investment Policy Reviews

In February 2019, The World Trade Organization (WTO) published a Trade Policy Review  for the East African Community (EAC) covering Burundi, Kenya, Rwanda, Tanzania, and Uganda, along with an annex specific to Rwanda .

Business Facilitation

RDB offers one of the fastest business registration processes in Africa. New investors can register online at RDB’s website  or register in person at RDB offices in Kigali. Once RDB generates a business registration certificate, company tax identification and employer social security contribution numbers are automatically created. The RDB’s “One Stop Center” assists firms in acquiring visas and work permits and connections to utilities. It also provides support with conducting required environmental impact assessments. RDB offers aftercare services for registered investors but firms with no investor certificate can also receive assistance.

Outward Investment

The Investment Code provides incentives for internationalization. A small- or medium-sized registered investor with an investment project involved in export is entitled to a 150 percent tax deduction of all qualifying expenditures relating to internationalization. Emerging investors are entitled to the same deduction. Eligible registered investors receive pre-approval of qualifying expenditures through a joint review process administered by RRA, RDB and the Ministry of Trade and Industry (MINICOM). The Commissioner General of RRA ultimately approves qualifying expenditures in consultation with the CEO of RDB. An eligible registered investor may claim the tax deduction on a maximum of $100,000 of qualifying expenditures each year. There are no restrictions limiting domestic firms seeking to invest abroad.

Transparency of the Regulatory System

The GOR generally employs transparent policies and effective laws which are largely consistent with international norms. Rwanda is a member of the UN Conference on Trade and Development’s international network of transparent investment procedures. The Rwanda eRegulations system is an online database designed to bring transparency to investment procedures in Rwanda. Investors can find additional information on administrative procedures here .
The GOR publishes Rwandan laws and regulations in the Official Gazette, which is available online here . Government institutions generally have clear rules and procedures, but implementation can sometimes be uneven. Investors cited breaches of contracts and incentive promises and the short time given to comply with changes in government policies as hurdles to complying with regulations.

There is no formal mechanism to publish draft laws for public comment, although civil society sometimes has the opportunity to review them. There is no informal regulatory process managed by nongovernmental organizations. Regulations are usually developed rapidly to achieve policy goals. Some investors lamented this process results in new regulations being adopted without the backing of scientific or data-driven assessments. Regulators do not publicize comments they receive. Public finances and debt obligations are generally made available to the public before budget enactment. Finances for State Owned Enterprises (SOEs) are not publicly available, though in 2021 some limited financial information for a small group of large SOEs was made public. Civil society organizations may request SOEs’ financial information by providing a legitimate reason, but these requests are not routinely granted.

There is no government effort to restrict foreign participation in industry standards-setting consortia or organizations. Legal, regulatory, and accounting systems are generally transparent and consistent with international norms but are not always adhered to. Consumer protection associations exist but are largely ineffective. The business community has been able to lobby the government and provide feedback on some draft government policies through the Private Sector Federation (PSF), a business association with strong ties to the government. In some cases, the PSF welcomed foreign investors’ efforts to positively influence government policies. On the other hand, some investors criticized the PSF for advocating for the government’s positions more so than conveying business concerns to the government.

International Regulatory Considerations

Rwanda is a member of the EAC Standards Technical Management Committee. Approved EAC measures are generally incorporated into the Rwandan regulatory system within six months and are published in the Official Gazette similar to other domestic laws and regulations. Rwanda is also a member of the Standards Technical Committee for the International Standardization Organization, the African Organization for Standardization, and the International Electrotechnical Commission. Rwanda is a member of the International Organization for Legal Metrology and the International Metrology Confederation. The Rwanda Standards Board (RSB) represents Rwanda at the African Electrotechnical Commission. Rwanda has been a member of the WTO since 1996 and notifies the WTO Committee on Technical Barriers to Trade on draft technical regulations.

Legal System and Judicial Independence

The Rwandan legal system was originally based on the Belgian civil law system. Following the revision of the legal framework in 2002, the introduction of a new constitution in 2003, and the country’s entrance to the Commonwealth in 2009, the Rwandan legal system consists of a mixture of civil law and common law. The judiciary addresses commercial disputes and facilitates enforcement of property and contract rights. Though it suffers from a lack of resources and capacity, it continues to improve. The judiciary is generally independent and impartial in civil matters, with some exceptions involving state interests. Investors state the government occasionally takes a casual approach to contract sanctity and sometimes fails to enforce court judgments in a timely fashion.

Laws and Regulations on Foreign Direct Investment

National laws governing commercial establishments, investments, privatization and public investments, land, and environmental protection are the primary directives governing investments in Rwanda. Since 2011, the government reformed tax payment processes and enacted additional laws on insolvency and arbitration. The Investment Code establishes policies on FDI, including dispute settlement (Article 13). The RDB publishes investment-related regulations and procedures here .
According to a WTO policy review report dated January 2019, Rwanda is not a party to any countertrade and offsetting arrangements or agreements limiting exports to Rwanda.

The most recent laws (passed between 2020-22) on FDI are below:
Amended Company Act 
Law on Mutual Assistance in Criminal Matters 
Law on Anti-Money Laundering and Terrorism Finance
Law on Partnerships 
Law on Transfer Pricing 
Law on Insolvency 
Law on Land Reference Prices 2021 
New Instructions on Modalities of Management, Lease, Auction and Acquisition of Mortgage
Law on Financial Service Consumer Protection 
New Land Law 
New Law Establishing Taxes on Income 
New Organic Law on Public Finance Management 
Law relating to the Protection of Personal Data and Privacy 

Competition and Antitrust Laws

The GOR created the Rwanda Inspectorate, Competition and Consumer Protection Authority (RICA) in July 2017, an independent body with the mandate to promote fair competition among producers. RICA’s mandate is to ensure consumer protection and enforcement of standards by reviewing mergers and acquisitions among other activities. In addition, there is a Competition and Consumer Protection Unit at MINICOM to address competition and consumer protection policy issues. To learn more on competition laws in Rwanda, please review the law and related policy here .

Market forces determine most prices in Rwanda, but in some cases, the GOR intervenes to fix prices for items considered sensitive, such a fuel and some basic foodstuffs like milk. On international tenders, a 10 percent price preference is available for local bidders, including those from regional economic integration bodies in which Rwanda is a member.

Some U.S. companies expressed frustration that while authorities require them to operate as a formal enterprise that meets all Rwandan regulatory requirements, some local competitors are allowed to operate informally without full regulatory compliance requirements. Other investors claimed SOEs, ruling party-aligned, and politically connected business competitors receive preferential treatment in securing public incentives and contracts. Some investors reported it was not always possible to compete aggressively in some sectors in which the existing domestic competition enjoyed strong political ties. Those who attempted to compete aggressively in those sectors risked losing their investment because of political interference, they explained. More information on specific types of agreements, decisions and practices considered to be anti-competitive in Rwanda can be found here .

Expropriation and Compensation

The Investment Code forbids the expropriation of investors’ property in the public interest unless the investor is fairly compensated. A 2015 expropriation law includes explicit protections for property owners.

A 2017 study by Rwanda Civil Society Platform stated the government conducted expropriations on short notice and did not provide sufficient time or support to help landowners negotiate fair compensation. The report included a survey that found only 27 percent of respondents received information about planned expropriation well in advance of action. While mechanisms exist to challenge the government’s offer, the report noted landowners are required to pay all expenses for the second valuation, which represents a prohibitive cost for rural farmers or the urban poor. Media reported wealthier landowners used their position to challenge valuations and received higher amounts. Political exiles and other embattled opposition figures have been involved in taxation lawsuits that resulted in their “abandoned properties” being sold at auction, allegedly at below market values.

Dispute Settlement

ICSID Convention and New York Convention

Rwanda is a signatory to the International Center for Settlement of Investment Disputes (ICSID) and the African Trade Insurance Agency (ATI). The ICSID seeks to remove impediments to private investment posed by non-commercial risks, while the ATI covers risk against restrictions on import and export activities, inconvertibility, expropriation, war, and civil disturbances.

Rwanda ratified the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards in 2008.

Investor-State Dispute Settlement

Rwanda is a member of the East African Court of Justice for the settlement of disputes arising from or pertaining to the EAC. Rwanda also acceded to the 1958 New York Arbitration Convention and the Multilateral Investment Guarantee Agency convention. Under the U.S.-Rwanda BIT, U.S. investors have the right to bring investment disputes before neutral, international arbitration panels. Disputes between U.S. investors and the GOR in recent years have been resolved through international arbitration, court judgments, or out of court settlements. Judgments by foreign courts and contract clauses that abide by foreign law are accepted and enforced by local courts, though these lack capacity and experience to adjudicate cases governed by non-Rwandan law. There have been several private investment disputes in Rwanda, though the government has yet to stand as complainant, respondent, or third party in a WTO dispute settlement. Rwanda has been a party to three cases at ICSID since becoming a member in 1963, including one with a U.S. firm which is no longer ongoing. SOEs are also subject to domestic and international disputes. SOEs and ruling party-owned companies party to suits have both won and lost judgments in the past.

International Commercial Arbitration and Foreign Courts

In 2012, the GOR launched the Kigali International Arbitration Center (KIAC). KIAC case handling rules are modeled on the UN Commission on International Trade Law (UNCITRAL) arbitration rules. According to their website, KIAC had registered 208 cases by October 2022. Close to 40 percent of those cases were international with parties from more than 20 nationalities (Burundi, China, Ethiopia, Egypt, France, India, Italy, Kenya, Korea, Pakistan, South Africa, South Korea, Singapore, Rwanda, Spain, Switzerland, Turkey, Uganda, the United States, and Zambia). Arbitrators appointed were from Rwanda, Kenya, Malaysia, Nigeria, Canada, the United States, and Singapore. Of the 89 KIAC-approved international arbitrators, only four are of Rwandan nationality. Currently, KIAC states it has more than 100 Rwandan and international arbitrators.

Some businesses reported being pressured to list the Rwanda-based KIAC as the seat of arbitration in contracts signed with the GOR. Some of these companies indicated they would have preferred arbitration take place in a third country, noting KIAC has a limited case record and is domiciled in Rwanda. Moreover, some companies reported difficulty securing international financing due to the KIAC provision in their contracts.

Bankruptcy Regulations

In December 2021, the GOR instituted a new insolvency and bankruptcy law, to support the Kigali International Financial Centre by aligning national laws with international best practices. One major change was the introduction of articles allowing foreign bankruptcy proceedings if companies in liquidation have business both in Rwanda and elsewhere. The law can be accessed here . As per Section 6 – Subsection 3 of the law, creditors, equity shareholders, and holders of other financial contracts have different rights depending on their position in the bankruptcy process. Creditors have the right to claim payment for their debts from the debtor’s assets. They are ranked in order of priority, with secured creditors being paid first, followed by unsecured creditors, and then shareholders. The bankruptcy law also provides for the creation of a creditors’ committee to represent the interests of all creditors. Equity shareholders have the right to participate in the bankruptcy process and to receive any residual assets after all creditors have been paid. But their claims are subordinate to those of all creditors. Holders of other financial contracts, including foreign contract holders, are entitled to the same rights as other creditors. The law also provides for the recognition of foreign judgments and bankruptcy proceedings in accordance with international law. The law allows for the possibility of restructuring and reorganizing bankrupt companies, allowing for the continuation of viable businesses. In such cases, creditors, equity shareholders, and other financial contract holders may be required to accept a reduction in the value of their claims to facilitate the restructuring.

On February 8, 2021, Rwanda passed a new Company Act with several bankruptcy and insolvency provisions. The new law can be found here .

On February 17, 2021, Rwanda published a new law on partnerships with several provisions on partnerships’ insolvency. The new law can be accessed here .

Investment Incentives

The Investment Code offers a package of benefits and incentives for registered investors in strategic growth sectors under certain conditions. These benefits and incentives include preferential corporate income tax, withholding tax, tax holidays, exemption from custom duties for products used in export processing zones, and internationalization.

Supplementary incentives are offered through the “Manufacture and Build to Recover Program” (MBRP). The MBRP is designed to boost economic recovery efforts targeting the manufacturing, agro-processing, construction, and real estate development sectors.

More information on incentives and benefits related to philanthropic investors, the mining sector, the film industry, industrial and innovation parks, angel investors, start-ups, immigration, accelerated depreciation, and capital gain tax exemption, can be found in the annex of the Investment Code here .
In addition, MINECOFIN, upon recommendation by the GOR’s Private Investment Committee (PIC) and approval by the Cabinet, can issue a Ministerial Order offering more incentives for investments deemed of strategic importance.

According to some investors, poor coordination between the RDB, RRA, MINICOM, and the Directorate of Immigration and Emigration led to inconsistent application of incentives. Investors reported tax incentives included in deals signed by the RDB were not honored by the RRA in a timely manner or sometimes were not honored at all. For its part, RRA noted investors who started with one agreement with RDB often saw their tax incentives shift when they entered into new arrangements with a line ministry. Senior RRA officials stated they were aware of this disconnect but said they were obligated to fulfill their mandate to grow the domestic revenue base through the application of tax law. Additionally, investors continue to face challenges with receiving payment for services rendered for GOR projects, VAT refund delays, and expatriation of profits. In 2016, the GOR instituted a law governing public-private partnerships (PPPs) as a step toward courting investments in key development projects. The law provides a legal framework concerning establishment, implementation, and management of PPPs. Detailed guidelines for the law can be accessed here .

Foreign Trade Zones/Free Ports/Trade Facilitation

The SEZ Authority of Rwanda (SEZAR), headquartered at RDB, regulates Kigali’s Special Economic Zone (KSEZ). Land in KSEZ is acquired through the Prime Economic Zone (PEZ) Secretariat, a private developer, under the regulations of SEZAR. The price per square meter is listed at $62, and the minimum size that can be acquired is one hectare (2.5 acres). Recently, some businesses reported prices of over $100 per square meter.

Bonded warehouse facilities are now available both in and outside of Kigali for use by businesses importing materials. In January 2016, the GOR signed a 25 year-concession agreement with Dubai Port World Logistics (DP World), prohibiting new bonded warehouses in Kigali. Bonded warehouses operational before the concession agreement was signed were allowed to continue and renew their licenses. The SEZ policy was revised in 2018. Under the new policy, foreigners and locals may only lease land in the SEZ.

According to some investors, the PEZ Secretariat faced challenges providing basic physical plant services such as utilities within the zone.
The GOR established a list of benefits for investors operating in the KSEZ (or any others in the country). These include tax and land ownership advantages. A company basing itself in a KSEZ can also opt to be a part of the Economic Processing Zone. Several criteria must be satisfied to qualify. These include requirements to maintain extensive records on equipment, materials and goods, suitable offices, and security provisions.
To operate in a SEZ, SEZAR must issue companies a user license. SEZAR is supposed to grant or reject a user license within three working days from the date of submission of a completed application. Holding an Export Processing Zone (EPZ) license will exempt a company from VAT, import duties, and corporate tax. The company is then obliged to export a minimum of 80 percent of production. Even after considering savings due to these government incentives, a few investors reported land in the SEZs was significantly more expensive than land outside the zones. The GOR stated there are no fiscal, immigration, or customs incentives beyond those provided in the Investment Code, though media occasionally speculated that certain investors received additional incentives. The list of goods prohibited under the EAC Customs Management Act applies in SEZs. In November 2018, the GOR approved the Bugesera Special Economic Zone (BSEZ), located 45 minutes from Kigali. A new airport is under construction near the BSEZ as well.

For a quick survey of companies currently operating in Rwandan special economic zones, please visit the Economic Zone catalogue here .

Performance and Data Localization Requirements

As per Section 4.a above describing Rwanda’s new data protection and privacy law, foreign IT providers are not obliged to share any source code or encryption technology. In addition, storage of personal data outside of Rwanda is only allowed with authorization.

There is no legal obligation for nationals to own shares in foreign investments and no requirement that shares of foreign equity be reduced over time. But the government strongly encourages local participation in foreign investments.

There is no formal requirement that a certain number of senior officials or board members be citizens of Rwanda unless as a pre-condition to benefits from increased investment incentives. For example, the Investment Code specifies an international company that moves its headquarters or regional office to Rwanda to be able to recruit any number of required managerial, professional, and technical foreign employees, at least 30 percent of professional staff must be Rwandan. A preferential corporate income tax rate of three percent is granted to collective investment schemes, special purpose vehicles, and pure holding companies if at least 30 percent of their professional staff are Rwandans and at least two professional or qualified Rwandan residents are members of their board of directors.

While the government does not impose conditions on the transfer of technology, it does encourage foreign investors to transfer technology and expertise to local staff to help develop Rwanda’s human capital. There is no legal requirement that investors must purchase from local sources or export a certain percentage of their output, though the government offers tax incentives for the latter.

Real Property

The law protects and facilitates acquisition and disposition of all property rights. Investors involved in commercial agriculture have leasehold titles and can secure property titles if necessary. The Investment Code states investors shall have the right to own private property, whether individually or collectively. According to the 2021 land law, which can be accessed here , foreign investors can acquire real estate, though there is a general limit on land ownership. Freehold is granted only to Rwandan citizens for no more than two hectares (five acres) and to foreigners for properties located in designated Special Economic Zones, or through a Presidential Order for exceptional circumstances of strategic national interests. Through the new land law of 2021, the GOR increased the length of long-term leases (emphyteutic leases) in residential and commercial areas for both citizens and foreigners acquiring land through private means to 99 years. Foreign investors can also acquire land through concessional agreements to use government private land. Such agreements cannot exceed 99 years but can be renewed. Mortgages are a nascent but growing financial product in Rwanda, increasing from 770 properties in 2008 to 80,445 in 2021, according to the RDB. In 2022, RDB reported registering 19,234 mortgages in 2021.

Foreign investors noted challenges related to the maintenance of their existing leases and some investors fear provisions of the 2021 Land Law will lead to significant investment risks. These investors noted foreigners may face barriers gaining an investment certificate needed to develop land. Investors also expressed fear that once granted, an investment certificate could be revoked by the government, leading to a loss of assets. Implementation of the law is ongoing.

Intellectual Property Rights

The RDB and RSB are the main regulatory bodies for Rwanda’s intellectual property rights law. The RDB registers intellectual property (IP) rights, providing a certificate and ownership title. Every registered IP title is published in the Official Gazette. The fees payable for substance examination and registration of IP apply equally for domestic and foreign applicants. From 2016, any power of attorney granted by a non-resident to a Rwandan-based industrial property agent must be notarized (previously, a signature would have been sufficient).

Registration of patents and trademarks is on a first time, first right basis so companies should consider applying for trademark and patent protection in a timely manner. It is the responsibility of the copyright holders to register, protect, and enforce their rights where relevant, including by retaining their own counsel and advisors. Through the RSB and the RRA, Rwanda has worked to increase protection of IP rights, but many goods that violate patents, especially pharmaceutical products, make it to market nonetheless. As many products available in Rwanda are re-exports from other EAC countries, it can be difficult for authorities to take action against counterfeit goods without regional cooperation. Also, investors reported difficulties in registering patents and having rules against infringement of their property rights enforced in a timely manner. In 2021, the GOR submitted a new IP law to Parliament that will organize a patent and trade office for Rwanda, but the draft law has yet to advance.

As a COMESA member, Rwanda is automatically a member of the African Regional Intellectual Property Organization. Rwanda is also a member of the World Intellectual Property Organization (WIPO) and is working toward harmonizing its legislation with WTO trade-related aspects of IP. Rwanda has yet to ratify WIPO internet treaties, though the government has taken steps to implement and enforce the WTO TRIPS agreements. Rwanda is not listed in USTR’s 2022 Special 301 report or the 2022 Notorious Markets List. In July 2020, Rwanda acceded to the Marrakesh Treaty to facilitate access to published works for persons who are blind, visually impaired, or otherwise print disabled. For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles here .

Capital Markets and Portfolio Investment

In February 2021, the GOR introduced new incentives to support the Rwanda Stock Exchange and the Capital Market Authority through the Investment Code. A preferential withholding tax of five percent is applicable to dividends and interest income paid to investors in companies listed on the Rwanda Stock Exchange. A preferential corporate income tax rate of three percent applies to collective investment schemes. A preferential corporate income tax rate of fifteen percent applies to fund management entities, wealth management services, financial advisory entities, financial technology entities, captive insurance schemes, mortgage finance institutions, fund administrators, finance lease entities, and asset backed securities.

In December 2017, the GOR established Rwanda Finance Limited (RFL), a state-owned enterprise charged with developing and promoting the Kigali International Financial Centre (KIFC). KIFC is an initiative intended to position Rwanda as a financial jurisdiction for investments into Africa, as well as reforming the domestic industry. The goal is to create a conducive ecosystem to attract pan-African and international financial service providers and investment funds to Rwanda. RFL pushed the GOR to change many Rwandan investment, banking, and commercial laws to align with OECD/EU and AML/CFT requirements.

Money and Banking System

Many U.S. investors expressed strong concern over local access to affordable credit and advise those interested in doing business in Rwanda arrive with their own financing already in place. Interest rates are high for the region, banks offer predominantly short-term loans, collateral requirements can be higher than 100 percent of the value of the loan, and Rwandan commercial banks rarely issue significant loan values. The prime interest rate is between 16-18 percent. Large international transfers are subject to authorization. Investors who seek to borrow more than $1 million must often engage in multi-party loan transactions, usually by leveraging support from larger regional banks. Credit terms generally reflect market rates, and foreign investors can negotiate credit facilities from local lending institutions if they have collateral and “bankable” projects. In some cases, preferred financing options may be available through specialized funds including the Export Growth Fund, the Rwandan Development Bank, or the Rwanda Green Fund (formerly known as FONERWA).

The banking sector holds more than 67 percent of the financial sector assets in Rwanda. In total, Rwandan banks have assets of around $5.06 billion, which reflects an 18.8 percent increase from June 2021 to June 2022, according to the National Bank of Rwanda (NBR). Rwanda’s financial sector remains highly concentrated. The largest and partially state-owned bank, Bank of Kigali (BoK), holds more than 30 percent of all assets.

Local banks often generate significant revenue from holding government debt and from charging a variety of fees to banking customers. The capital adequacy ratio increased to 23.1 percent in June 2022 from 22.5 percent over the year and was still well above the prudential minimum of 15 percent, suggesting the Rwandan banking sector continues to be generally risk averse. Non-performing loans decreased from 5.7 percent in June 2021 to 4.3 percent in June 2022 but mainly due to the write-off of overdue loans.

The IMF gives the NBR high marks for its effective monetary policy. NBR introduced a new monetary policy framework in 2019, which shifted toward an inflation-targeting monetary framework in place of a quantity-of-money framework. In April 2020, the NBR arranged a $53.4 million liquidity fund for local banks facing challenges from COVID-19. The NBR allowed banks to restructure loans affected by the pandemic by authorizing an average of four months in loan holidays.

Foreign banks are permitted to establish operations in Rwanda. Several Kenya-based banks operate in the country.

In November 2020, the GOR signed an MOU with the African Export-Import Bank (Afreximbank) to host the permanent headquarters of Afrexim Fund for Export Development in Africa (FEDA) in Kigali.

Rwandans primarily rely on cash or mobile money to conduct transactions, though use of debit and credit cards is expanding. Use of mobile money grew by more than 500 percent since March 2020 due in part to changes brought about by COVID-19 and business closures.

Foreign Exchange and Remittances

Foreign Exchange

In 1995, the government abandoned a dollar peg and established a floating exchange rate regime under which all lending and deposit interest rates were liberalized. The NBR publishes an official daily exchange rate, which is typically within a two percent range of rates seen in the local market. Some investors report occasional difficulty in obtaining foreign exchange. Rwanda generally runs a large trade deficit. Rwanda’s trade deficit was estimated at 16 percent of GDP in 2021. Transacting locally in foreign currency is prohibited in Rwanda. Regulations set a ceiling on the amount of foreign currency that can leave the country per day. In addition, regulations specify limits for sending money outside the country; the NBR must approve any transaction exceeding these limits.

Most local loans are in local currency. In December 2018, NBR issued a new directive on lending in foreign currency which requires the borrower to have a turnover of at least $50,000 or equivalent in foreign currency and have a known income stream in foreign currency not below 150 percent of the total installment repayments. Moreover, the repayments must be in foreign currency. The collateral pledged by non-resident borrowers must be valued at 150 percent of the value of the loan. In addition, NBR requires banks to report regularly on loans granted in foreign currency.

Remittance Policies

Investors can remit payments from Rwanda only through authorized commercial banks. There is no limit on the inflow of funds, although local banks are required to notify NBR of all transfers over $10,000 to mitigate the risk of potential money laundering. Additionally, there are some restrictions on the outflow of export earnings. Companies generally must repatriate export earnings within three months after the goods cross the border. Tea exporters must deposit sales proceeds shortly after auction in Mombasa, Kenya. Repatriated export earnings deposited in commercial banks must match the exact declaration the exporter used crossing the border.

Rwandans working overseas can make remittances to their home country without impediment. It usually takes up to three days to transfer money using SWIFT financial services. The concentrated nature of the Rwandan banking sector limits choice, and some U.S. investors expressed frustration with the high fees charged for exchanging Rwandan francs to dollars.

Sovereign Wealth Funds

In 2012, the Rwandan government launched the Agaciro Development Fund (ADF), a sovereign wealth fund that includes investments from Rwandan citizens and the international diaspora. By June 30, 2022, the fund was worth $244.4 million in assets. The ADF operates under the custodianship of the NBR and reports quarterly and annually to MINECOFIN. ADF is a member of the International Forum of Sovereign Wealth Funds and is committed to the Santiago Principles. In addition to returns on investments, voluntary contributions from citizens and the private sector, and other donations, ADF receives proceeds from public assets the GOR privatizes. The fund also receives five percent of royalties from minerals and other natural resources each year. ADF invests mainly in Rwanda. According to the 2021 annual report, the fund invested in foreign private equity. The ADF can also invest in non-fixed income investments such as publicly listed equity and joint ventures.

Privatization Program

Rwanda continues to carry out a privatization program that has attracted foreign investors in strategic areas ranging from telecommunications and banking to tea production and tourism. As of 2017 (the latest data available), 56 companies have been fully privatized, seven were liquidated, and 20 more were in the process of privatization. RDB’s Deal Acceleration & Transactions Department is responsible for implementing and monitoring the privatization program. In July 2022, the GOR announced the creation of the Ministry of Public Investments and Privatization (MININVEST) with the privatization of public investments as one of its mandates. Some observers questioned the transparency of certain transactions, noting a number of transactions were undertaken not through public offerings but through mutual agreements directly between the government and the private investors, some of whom have personal relationships with senior government officials.

Climate Issues

The GOR is known for aggressively pioneering environmental protection initiatives, including the continent’s first updated Nationally Determined Contribution. For example, in March 2022, the fifth session of the UN Environmental Assembly adopted a resolution co-authored by Rwanda and Peru to end plastic pollution. Rwanda’s Parliament had in 2019 already passed a law banning single use plastic containers. The law built on an earlier ban of the manufacture and use of plastic bags. With respect to the ban on single use plastic containers, several investors complained the GOR did not consult effectively with concerned stakeholders and observed alternative packaging materials were either unavailable or could only be obtained at high cost.

Rwanda adopted the Kigali Amendment to the Montreal Protocol in October 2016, and 197 participating countries committed to cut the production and consumption of hydrofluorocarbons (HFCs) by more than 80 percent within 30 years (by 2047).

The GOR manages the Rwanda Green Fund (formerly known as FONERWA) to spur investment in green innovation. UK Aid, France, Sweden, the European Investment Bank, and other donors have supported the fund. According to the Rwanda Green Fund, it has supported 46 projects which have created more than 176,000 green jobs and avoided emissions equivalent to 126,014 tons of carbon dioxide. In November 2022, the Rwanda Green Fund launched Ireme Invest with an initial capitalization of $104 million to support the private sector in accessing green finance. Ireme Invest will also serve as a one-stop center for green and sustainable investments in the country.

Rwanda’s Nationally Determined Contributions include an unconditional target (“based on domestically supported and implemented mitigation measures and policies”) to reduce Rwanda’s greenhouse gas emissions by 16 percent relative to business as usual by 2030. Its conditional contribution, depending on the provision of international support and funding, would be to reduce its greenhouse gas emissions by an additional 22 percent (38 percent total).

Resources to Report Corruption

Contact at the government agency or agencies responsible for combating corruption:

Ms. Madeleine Nirere, Chief Ombudsman, Ombudsman (Umuvunyi)
P.O Box 6269, Kigali, Rwanda Telephone: +250 252587308
omb1@ombudsman.gov.rw / sec.permanent@ombudsman.gov.rw

Ms. Rosine Uwamaliya, Commissioner for Internal Audit and Integrity, Rwanda Revenue Authority
Avenue du Lac Muhazi, P.O. Box 3987, Kigali, Rwanda
Telephone: +250 252595504 or +250 788309563
rosine.uwamaliya@rra.gov.rw

Mr. Alexis Kamuhire, Auditor General, Office of the Auditor General
Avenue du Lac Muhazi, P.O. Box 1020, Kigali, Rwanda
Telephone: +250 78818980
oag@oag.gov.rw

Contact at a “watchdog” organization:

Mr. Apollinaire Mupiganyi, Executive Director, Transparency International Rwanda
P.O: Box 6252 Kigali, Rwanda
Telephone: +250 788309563
amupiganyi@transparencyrwanda.org / mupiganyi@yahoo.fr