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Development of knowledge-based economy in Rwanda: The 20-year Review

eNitiate | Knowledge-based Economy in Rwanda | Banner | 26 Jun 2020

It has been 20 years since the Rwanda made a declaration in its Vision 2020 document, to elevate its nation from a low-income to a middle-income society, using knowledge-based economy as the backbone.

The timing of this eNsight, which focuses on this country of 12 million people, more than 80% of whom still live in the rural areas (versus 60% for Sub-Saharan Africa), and aspires to be Africa’s digital hub, is perfect.

This eNsight is also the fourth in a series on the benefits of coronavirus to Africa’s digital economies. 

As is customary, this eNsight is rich with content, stats and valuable references. 

Use the table below as your navigator. 

My advice on where to start? I would read sub-section 2 of The Glossary first, followed by Key Takeouts and Lessons; and then the rest of the eNsight thereafter.

Table of Contents

Inspiration for this eNsight

My analysis of the Global Open Data Barometer rankings of top 5 African countries (by monthly Facebook active users), found in the second eNsight in this series, was the source of inspiration for this eNsight.

I wrote at length about the benefits of making government data open and easily accessible; which include transparency, accountability and innovation; in the second eNsight. 

You can click on the button here below to read more.

The World Wide Web Foundation, the organisation behind the Open Data Barometer (ODB) – a measure of participating countries’ effectiveness of open government data policies – made a special mention about Rwanda in the 3rd edition of the Africa Regional Open Data Barometer Report, which was published in 2015.

Ranking of effectiveness of open government data policies is based on the following criteria:

  • Readiness: assessment of governments’ open data policies and initiatives.
  • Implementation: Assessment of timely and consistent publishing of, and easy access to government open data by all including business and civil society.
  • Impact: assessment of use of open government data by all interested parties in ways that bring practical benefit.

92 countries participated in the 3rd edition of the ODB, and 23 of them come from Africa.

The graph below plots all the 92 countries. 

eNitiate | World Wide Foundation | Open Data Barometer | 3rd Edition | 2015 | Rwanda | June 2020
Source: Open Data Barometer | 3rd Edition | 2015

Rwanda came out at the 46th spot in the ODB with a open data score of 27.55 – the second highest ranked African country after Kenya (42nd position | open data score = 29.87), and ahead of 21 other African countries in the rankings, including the top 4 by monthly active Facebook users – South Africa (47th | 26.77), Morocco (62nd | 16.17), Nigeria (67th | 14.13) and Egypt (75th | 8.74).

[We] believe that: 1. Open data must be for everyone — a right for all; 2. Open data must be the data people need; and 3. Open data must be data people can easily use.

World Wide Web Foundation | Open Data Barometer Tweet

I am familiar with Kenya’s open data policy and how it drives digital innovations in this East African nation of 54 million people.

Therefore, I am not surprised by its open data score that puts it first in Africa.

However, Rwanda’s showing in the 3rd edition of ODB was unexpected.

So I decided to dig deeper for what lies behind the score, which I present in this eNsight.

A bit about Rwanda

Many Africans, and many people around the world with an eye on Africa, would say – “there is something about Rwanda, but we don’t quite know what it is”.

Or, do we?

Is President Paul Kagame – Africa’s Head of State who seems to earn praise and scorn in equal measure – the sole reason why this East African country is receiving the world’s attention, mostly for positive reasons but also envy?

One thing is undeniable.

This relatively small country by population has been writing and rewriting the history books since July 1994, when Rwanda genocide finally ended, and no one knew at that stage what will happen next.

Despite fears for the worst, including the prospect of retributions and a permanent state of paralysis, President Kagame was able to put his country back to work through the implementation of a nation rebuilding project that was short of a miracle.

It has proven successful beyond imagination.

But before I present supporting evidence of Rwanda’s success, let me put the spotlight on President Kagame briefly. 

Rwanda's President has earned his digital stripes

With knowledge-based economic model as the selected weapon of success, how digitally savvy is the man at helm?

Top 18 African Heads of State on Twitter

In August of 2017 eNitiate published a very detailed eNsight about top 18 African Heads of State on Twitter.

At that stage, President Kagame had the second highest number of Twitter followers (1.7 million) after President Uhuru Kenyatta (2,3 million), and the latter subsequently closed down his personal account in March 2019, apparently due to hacking.

While President Kagame now has the 3rd highest number of Twitter followers (1.9 million, as at today) after President Elsisi of Egypt (4 million followers) and President Buhari of Nigeria (3.2 million followers) in the top 18 African Heads of State list; he [Kagame] has the oldest Twitter account – opened in May 2009.

The eNsight about the updated list of top African Heads of State on Twitter will be published in August 2020. Look out for it then.

In addition, President Kagame is known for being one of the few Heads of State across the board, and certainly the only one in Africa to the best of my knowledge, who engages personally and passionately on politics and soccer on Twitter

A forthright individual, he has earned himself the title of Africa’s true Twarrior for taking no prisoners when it comes to defending his country and the continent on this microblog.

Africa's Digital President?

Equally deservingly, President Kagame is dubbed Africa’s “Digital President” by the media, because he leads from the front in steering his country of Rwanda, and Africa through the Smart Africa initiative, in the direction of knowledge-based economy.

It is no surprise that he received the 2014 World Telecommunication and Information Society Award from the International Telecommunication Union (ITU) – the only African Head of State who has achieved this feat thus far, according to my online research.

Rwanda's Internet penetration

For context, here are the latest Internet penetration stats, comparing Rwanda with the top 5 African countries based on monthly active Facebook users:

eNitiate | Internet Penetration - Rwanda vs Egypt vs South Africa vs Kenya vs Nigeria vs Morocco vs Egypt | Knowledge-based Economy in Rwanda | 26 Jun 2020

The Internet penetration levels in the graph above do not tell the whole story, as I shall show in the rest of this eNsight. 

Rwanda's march to middle-income nation

Rwanda’s Vision 2020, which was published in 2000, identified knowledge-based economy as the answer to transforming the country from a low-income to a middle income nation, which is measured by growth in GDP per capita.

Overall economic growth

Let me start with the key measure of success for all nations – economic growth.

Rwanda’s interactive economic (GDP) growth graph below, which dates back to 1961, shows that this country of Kinyarwanda speakers is on track to become one of Africa’s shining star. 

Mouse over any coordinate on the graph to see the year and associated economic growth.

Rwanda’s average year-on-year growth between 2000 (the year when Vision 2000 was published) and 2018 has been 7.85%.

For perspective

Below is a graph with Rwanda’s average GDP growth for 19 years to 2018, compared to the top 5 African countries by monthly active Facebook users, and also the top 6 by GDP.

eNitiate | GDP Growth 2000 to 2018 - Rwanda vs Egypt vs South Africa vs Kenya vs Nigeria vs Morocco vs Egypt | Knowledge-based Economy in Rwanda | 26 Jun 2020

As the graph above shows, Rwanda’s average GDP growth puts it in the front seat.

Rwanda's GDP per capita growth

GDP per capita is used as an indicator of a country’s income level.

GDP per capita = GDP divided by total population.

In 2000 when Rwanda launched Vision 2020, its GDP per capita was $218.68 (World Bank).

The country wanted to achieve a GDP per capita of $900 by 2020

The original target was subsequent revised to $1,240 in 2012.

I guess the government felt that the original target was not ambitious? I am convinced this is part of this country’s character.

The interactive World Bank graph below shows how Rwanda’s GDP per capita has performed between 1961 and 2018. 

Mousing over the graph above, you will notice that Rwanda’s GDP per capita was $127 in 1994, $219 in 2000 and $773 in 2018.  The growth over this period has been phenomenal.

However, with a 19-year average  (2000-2018) of 6.69%, Rwanda will end 2020 under $1,000 GDP per capita, which is below the targeted $1,240

Therefore, the original $900 target was more realistic.

In essence, Rwanda will not break into the middle income bend by 2020, given the global minimum threshold of $1,025.

However, the country’s GDP per capita will reach $1,068 by 2023 – a mere 3 years away from now, and around $1,300 by 2026.

For perspective

Below is a graph that compares Rwanda’s 2018 GDP per capita with the top 5 African countries. 

eNitiate | GDP Per Capita in 2018 - Rwanda vs Egypt vs South Africa vs Kenya vs Nigeria vs Morocco vs Egypt | Knowledge-based Economy in Rwanda | 26 Jun 2020

The GDP Per Capita graph above shows Rwanda has some way to go to, if there is any hope of catching up with the top 5.

In fact, if the 19-Year average growths of Kenya at 8.07%, South Africa at 4.95%, Nigeria at 8.73%, Egypt at 4.26%% and Morocco at 4.59% are used to project GDP per capita until 2050, Rwanda will at best give Egypt a run for its money.

To demonstrate, the GDP Per Capita graph below plots the projections for 2018, 2020, 2023 (when Rwanda is expected to break into the middle-income bracket), 2026 (vision 2020 target is met) and 2050.

eNitiate | GDP Per Capita Growth - Rwanda vs Egypt vs South Africa vs Kenya vs Nigeria vs Morocco vs Egypt | Knowledge-based Economy in Rwanda | 26 Jun 2020 - 2

Why is Rwanda’s GDP per capita performance remarkable still, despite lagging behind the top 5? 

The answer lies in the analysis of the rural nature of its nation, when compared to the top 5, and the same can be said about Kenya.

4 in 5 Rwandans live in the rural areas, while it is only 1 in 3 in South Africa.  

This skew brings with it many challenges, including Internet penetration levels, but the government of President Kagame is forging ahead with its ambitious plans. 

So, what has been Rwanda’s programme of action for the transformation of its economy?

Digital literacy: the prerequisite for development of Rwanda's knowledge-based economy

As far back as 2007, Rwanda launched a global digital literacy initiative called One Laptop Per Child (OLPC), signaling the country’s clear intention to align its education outcomes with the vision. 

eNitiate | One Laptop Per Child Report | 2011
Source: One Laptop One Child | Rwanda Report | 2011

In 2001, only one of the country’s 2,300 primary schools had even a single computer. As of 2005,1,138 schools had at least one PC; 40 schools in Kigali had Internet access and connectivity was being rolled out to schools in other regions. About 1,000 teachers had been trained in computer literacy and deployed in 120 primary schools.

One Laptop Per Child | Rwanda Report | 2011 Tweet

OLPC faced demise, but Rwanda kept going

The OLPC initiative has since folded, and its failure was attributed to its inability to deliver against a promise of a $100 laptop, among other issues.

However, this has not hindered Rwanda’s digital literacy focus, as indicated by: 

  • Publishing of National Digital Talent Policy of 2016; 
  • Collaboration with the youth in the 2017 launch of the Digital Ambassador Programme – a youth volunteer programme meant to teach communities basic ICT skills including e-commerce; 
  • Partnership with Andela – africa-focused tech talent accelerator – in 2018 for rapid development of digital skills; and 
  • The launch of Rwanda Coding Academy in early 2019 for the development of software skills. 
  • The most recent announcement, which hit the news stands earlier this month, is that Rwanda has been chosen to lead Africa in a UNICEF and ITU project – called the Giga initiative – to connect all schools on the continent to the Internet by 2030. 

Rwanda's list of ICT initiatives is long

Digital literacy initiatives are only a part of the country’s ICT development roadmap.

Here are four examples that are worth a mention.

Rwanda becomes the first market for Africa's first locally manufactured smartphone

Rwanda is credited for being the first-ever African country with a “made in Africa” smartphone brand. 

Called the Mara Phone, this Android smartphone brand was launched in October 2019 in Rwanda. There are 2 models – Mara X and Mara Z – in the market.

eNitiate | Rwanda| Mara Phone | Z Model | June 2019
Mara Phone Source: notebookcheck.net

With retail prices retailing between $130 (for the X model) and $190 (the Z model), this smartphone brand is fairly pricy. 

However, it looks like plans are in place to launch cheaper models, hopefully in the not-too-distant a future.

A supporting campaign to increase Mara phone's reach

Under the flagship #ConnectRwanda, a campaign was launched by MTN in December 2019, to encourage mainly corporates operating in Rwanda to donate Mara Phones to less affording communities through a pledge.  

President Kagame was also challenged to participate, and he pledged 1 500 phones

As reported in the media, over 40 000 Mara Phones were in the market by end of February this year, and the pledge campaign was the major contributor.

I suspect Covid-19 scuttled the continuation of the campaign.

It is clear that private-public partnerships and collaborations are a big thing in Rwanda.

Rwanda is a perfect example of what’s possible when dedicated leadership, careful policy management, and an active private sector come together to build a digital future.

Houlin Zhao, ITU Secretary General | May 2018 Tweet

On a tongue-in-cheek note

If the Mara Phone is to make its way down South – and I hope it does, I suspect sections of the South African population will battle with the word “Mara”.

In ZA’s local lingo, the word “mara” – borrowed from Afrikaans’s “maar” that is directly translated “but” – is frequently used in comparative terms to mean something is less than, not such a good idea for such name that enters a highly competitive market with well-established brands lead by Samsung.

Africa needs to embrace and harness the unfolding data revolution. More importantly, the world is moving inexorably towards the fourth industrial revolution and becoming a knowledge society grounded in the data economy. Africa cannot afford to be left behind...

World Wide Web Foundation | Africa Data Revolution Report | 2018 | P.13 Tweet

Rwanda is the seat of the Smart Africa initiative

The Smart Africa initiative – Africa’s boldest move yet, to “accelerate sustainable socioeconomic development on the continent, ushering Africa into a knowledge economy through affordable access to Broadband and usage of Information and Communications Technologies” – was launched in Kigali in 2013. 

The genesis of this initiative can be traced back to the Connect Africa Conference that was jointly hosted by the government of Rwanda and the International Telecommunications Union (ITU) in 2007 in Kigali. 

Rwanda is one of the original 7 signatories of Smart Africa, together with Kenya, Uganda, South Sudan, Mali, Gabon, and Burkina Faso. 

Kigali played the host city of the launch in 2013.

The number of African member states that have become part of this initiative, which is headquartered in Kigali, has since grown to 30.

eNitiate | Smart Africa | The 30 Member States | 23 June 2020
Source: smartafrica.org/

The 21 country flagship projects under the Smart Africa banner are a clear indication that this initiative is going to drive digital Africa forward in ways that have never been seen before. 

And yes, President Kagame is the chair of the board at the time of publishing this eNsight.

The link between Rwanda and Transform Africa Conference

The Transform Africa Conference (TIA), which is a property of Smart Africa, was also inaugurated in 2013 in Kigali.

One of this gathering’s objectives is to ensure Africa keeps tabs on broadband technology trends for economic and human development.

For Africa to thrive, digital technologies will be a game changer on how they access global markets, foreign technology and investments, benefit from the economies of scale brought about by regional integration, maximize the welfare of the continent as a whole.

I had the fortune of attending TIA 2018 in Kigali.

eNitiate | Bra Willy Seyama | Seif Kabele | Transform Africa Summit 2018
Transform Africa Summit 2018 | Bra Willy Seyama (right) with Seif Kabelele

I can say that Africa’s digital future under the leadership of President Kagame and his ilk is promising. 

Rwanda became the first African country for Alibaba's eWTP

eWTP stands for electronic world trade platform.

This is Alibaba’s trading platform that directly connects other countries to the Chinese market.

Rwanda was the second country after Indonesia to sign the eWTP agreement with Alibaba.

The eWTP, which was launched in 2018, will give Rwanda direct access to the Chinese market for its tourism, coffee and crafts products and services.

eNitiate | Alibaba | Rwanda | Alizila | eWTP | 23 June 2020
Source: alizila.com

eWTP stands for electronic world trade platform.

Alibaba uses this trading platform to directly connect other countries with the vast Chinese market.

Rwanda was the second country after Indonesia to sign the eWTP agreement with Alibaba.

The eWTP Africa, which was launched in 2018, will give Rwanda direct access to the Chinese market for its tourism, coffee and crafts products and services.

At the time of publishing this eNsight, Ethiopia is the second only African country that signed the Alibaba eWTP agreement.

Why Rwanda follows the Asian economic growth model

Much has been written about Rwanda’s choice to develop its economic growth model using principles of the economies of East Asian countries – Hong Kong, Singapore, Taiwan and South Korea.

Why these countries?

Michael Spence, the Nobel Laureate, Professor of Economics at NYU and author of a book titled “The Next Convergence“, indicates that East Asian countries do not have natural endowments such as minerals and oil, like most of Africa.

This made them focus on a different strength that they did not have yet when they set off on their different economic development journeys, but which they could develop.

eNitiate | Michael Spence | Asian Economic Growth Model Rwanda | 26 Jun 2020
eNitiate | Michael Spence | The Next Convergence | Asian Economic Growth Model Rwanda | 26 Jun 2020

Spence describes the characteristics of the Asian economic growth model as follows:

  • High investment in human capital, funded domestically;
  • Taking of long view for economic growth, forecasted in decade-long periods;
  • Inculcation of the culture of anti-corruption, and rooting it out wherever it happened;
  • Open economies that attract foreign direct investment (FDI), which is a driver of inbound technology transfers;
  • Specialisation based on identified competitive advantage; and
  • Leveraging the big global marketplace. 

As the Professor explains, countries that grow at average 7% or more for minimum 25 years double their economies every decade. This is how the Asian tigers lifted their economies out of poverty.

Rwanda identifies with the Asian tigers, and it adopted many of their economic principles diligently. No wonder its economic growth trajectory mirrors theirs.

Lastly, Spence remarks that the digital economic model tends to result in more widespread benefits as the Internet is the antithesis of information asymmetry, and typically leads to higher levels of entrepreneurship. 

Clearly, Rwanda’s entrepreneurship scene is facing a bright future, with the government’s choice of knowledge-based economic model. 

#DidYouKnow: Rwanda is the first African country to implement the COVID-19 lockdown

According to WHO, Rwanda was the first African country that implemented s for COVID-19 lockdown, on March 21st. 

What is the relevance of this point?

It is to illustrate a pattern. Indeed, Paul Kagame’s country moves with required speed on many fronts.

Jack Ma of Alibaba said as much in his address during the launch of eWTP

Thus, the success that Rwandans are enjoying should not come as a surprise to all of us. 

But there is more to the success funadamentals.

Key takeouts: Rwanda's 20-year review

Rwanda has been on the journey to develop its knowledge-based economy since the year 2000 with the publishing of Vision 2020.

Still, the country will not achieve the revised GDP per capita target of $1,245 until 2026, accordion to my forecast.

But all the key economic and human development indicators are pointing in the right direction.

One wonders where Rwanda would be if the following elements were not ALL in place:

  • An ambitious Head of State who is an inspiration to his nation, with a cherry on top being his passion for ICT;
  • Agile Education and ICT and Innovation Ministries;
  • Unwavering government commitment and support;
  • Open, transparent and accountable government;
  • Full buy-in by the citizenry;
  • Robust policies;
  • Focused, coordinated and measurable implementation systems and processes;
  • Effective public-private-civil society partnerships; and
  • A healthy dose of can-do attitude across the nation, coupled with willingness to try new things and a shared sense of urgency.

Essentially, the elements above make up Rwanda’s secret formula to success.

As an aside, I suspect Rwanda’s Tourism and Sports Ministries applied the very same formula above to clinche soccer sponsorship deals, first with Arsenal, followed by Paris St Germain.

The first African country to venture into European soccer.

These deals – one of Rwanda’s many firsts – got tongues wagging across the world as well, again with praises and condemnations in equal measure.  

Arsenal | Vist Rwanda | 26 Jun 2020
Source: dailymail.uk.co
Paris St Germain | Visit Rwanda | 26 Jun 2020
Source: topvisages.net

Lessons for the rest of the continent?

For Africa, the digital economic model offers real possibilities.

But there is also a warning. It is not a walk in the park.

As Rwanda has demonstrated, it takes vision by the country’s leadership; and commitment, partnership, effort, focus and time by all of each nation’s relevant stakeholders.

Does the adoption of digital economies give hope that Africa can take her place at the 4IR table, or is the continent facing the prospect of another lost opportunity?

I am hopeful, but I am also nervous.

In closing...

As a self-appointed Pen-African (my new title), it is my duty to ensure that I add my voice to positive stories about the continent that deserve to be told.

Rwanda’s rise from the ashes is certainly one such.

Does this make me one of President Kagame’s cheerleaders?

You be the judge. 

It is befitting to end this eNsight with a video featuring H.E. Paula Ingabire, Rwanda’s Minister of ICT & Innovation, who talks about a few ICT projects that demonstrate Rwanda’s ICT success, including transporting of blood to hospitals using drones that has cut down blood wastage by up to 80%.

The Glossary

1. Rwanda's key development indicators

Here below is a glossary of links to key economic and human development indicators that provide further evidence of Rwanda’s positive growth trajectory. 

Feel free to check them out.

2. Rwanda's modernisation of African cultures

It has been my experience that there is an unwritten rule that  Africa must ditch her own cultures – her own way of doing things – in order to join the information highway.

Rwanda’s adaptation and incorporation of African cultures as part of developing the country shows that this expectation, whether it is self-imposed or not, is unfounded.

Take a look at the examples below, which were extracted on page 66 of Unesco’s Mapping Research and Innovation in the Republic of RwandaVolume 4 document.

ABUNZI. The word Abunzi can be translated as ‘those who reconcile’ or ‘those who bring together’ (from verb kunga). Abunzi can be seen as a hybrid form of justice combining traditional with modern methods of conflict resolution. Today Abunzi is fully integrated into Rwanda’s justice system. This conflict resolution mechanism rooted in Rwandan culture was perceived as more accessible, less threatening and therefore more intimate and human.

IMIHIGO. Imihigo is the plural Kinyarwanda word of Umuhigo, which means to vow to deliver. Since its introduction, Imihigo have been credited with improving accountability and quickening the pace of citizen-centred development activities and programs. The practice of Imihigo has now been extended to ministries, embassies and public service staff. Over the years, the practice has evolved into a tool for effective planning, implementation, performance evaluation and accountability for all public institutions and staff.

UBUDEHE. When Ubudehe was launched into Rwandan life, it was as way to better involve communities in their development by setting up participatory problem solving mechanisms. The program was seen as a way to strengthen democratic processes and good governance through greater community involvement in decision-making. Ubudehe creates opportunities for people at all levels of society, especially the village level, to interact with one another, share ideas, create institutions and make decisions for their collective development.

UMUGANDA. Close to 80% of Rwandans take part in monthly community work. Successful projects include the building of schools, medical centres and hydroelectric plants as well as rehabilitating wetlands and creating highly productive agricultural plots. The value of Umuganda to the country’s development since 2007 has been estimated at more than US$60 million.

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