- June 21, 2023
- Posted by: AITRC 2
- Category: News
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| The UNCTAD report on Enhancing Productive Capacities in Rwanda highlights the importance of developing a coherent and operational strategy to achieve Rwanda’s Vision 2050 and propel the country towards high-income status and sustainable development. While Rwanda has made significant economic progress in the past two decades, there are several structural challenges that need to be addressed to ensure continued growth and resilience in the face of technological progress and climate change. Productive capacity development is identified as a pivotal factor in achieving Rwanda’s economic and social objectives, as it fosters structural transformation, diversification, and employment generation. The report emphasizes the need for productive capacities to play a more central and transversal role in the national trade and industrial policies currently under revision. Rwanda faces gaps in productive capacities, including underutilization of existing capacities and weak infrastructure in areas such as information and communication technologies, energy, and transport. To address these challenges, the report proposes a coherent and operational strategy with a focus on four key policy areas: investment and technology, human and physical capital, the private sector, and policy coherence and inclusiveness. The strategy emphasizes the importance of targeted investments and technology adoption to drive structural change. It recommends better allocation of investments, particularly in priority sectors such as manufacturing and agro-processing, and the exploration of additional sources of capital, including private investment. Technology is identified as a weak area but also as an opportunity, as demonstrated by the rapid digitalization during the COVID-19 pandemic. The strategy proposes enhancing technology availability, developing e-commerce infrastructure, improving digital literacy, and providing technology-related business services. It also underscores the importance of developing inter-sector linkages and value chains, including through the establishment of Special Economic Zones. In terms of human and physical capital, the report acknowledges Rwanda’s impressive progress in human development and gender empowerment but highlights skills shortages as a major constraint. The strategy outlines specific measures to bridge the skills gap and identifies interventions related to the cost of electricity and infrastructure provision for Special Economic Zones. The report emphasizes the need to address constraints faced by the private sector to improve the business ecosystem. It recommends enhancing access to finance, business support services, and extension services for agriculture. The strategy also advocates for stronger linkages between the public and private sectors and measures to increase the utilization of existing capacities. Lastly, the strategy focuses on enhancing policy coherence and inclusiveness. It proposes aligning trade and investment policies with the national development framework, defining their scope and interlinkages with other policy areas more effectively. The strategy also aims to strengthen gender provisions in trade and industry-related policies, address informality in cross-border trade, and cater to the needs of micro, small, and medium-sized enterprises. The report acknowledges the importance of skills and institutional capabilities required for implementing the operational strategy and highlights key implementation issues, such as resource mobilization, monitoring, and evaluation. By adopting the proposed strategy and prioritizing the four policy areas, Rwanda can enhance its productive capacities, foster structural transformation, and overcome the challenges posed by technological progress, climate change, and the COVID-19 pandemic. This will contribute to the country’s continued economic growth and progress towards its national developmental objectives outlined in Vision 2050. To download UNCTAD report on Enhancing Productive Capacities in Rwanda A Coherent and Operational Strategy click here |
