Where there is a will, there is a way: The case of small business development in Rwanda

The Rwandan government and its stakeholders have risen to the occasion, lowering Rwanda’s trade imbalance through unprecedented development and support of SMMEs

“When SMMEs work collaboratively within a cluster, they have new market opportunities, and this increases learning.”

It was not accidental…

A thought leadership piece by Clare Akamanzi, the Chief Executive Officer of the Rwanda Development Board (RDB), highlights the true meaning of the adage “where there is a will, there is a way”.

Akamanzi asserted that when it comes to the development of SMMEs, the Rwandan government, its development partners and the private sector have not played victim to the horrors of the 1994 genocide against the Tutsi.

Government and its stakeholders have risen to the occasion, lowering Rwanda’s trade imbalance through unprecedented development and support of SMMEs. As a result, Rwandan SMMEs account for about 98% of businesses and 41% of private-sector employment, according to Akamanzi.

This success story was a follow-through on the challenges identified to have hampered SMME growth in Rwanda.

A report by The Khana Group (TKG) lists the following key challenges:

• Limited business development services
• High cost of doing business
• Limited technical and business skills
• Lack of entrepreneurial culture
• Lack of access to finance
• Difficulty accessing market information and markets

The ‘will’ in practice

Creating an enabling environment

The Rwandan government, in collaboration with key stakeholders, instituted pro-business reforms that reduced the cost of doing business, subsequently creating a conducive environment for SMMEs. This earned Rwanda well-deserved recognition in the World Bank’s Doing Business report (Focus on SMEs in Rwanda, 2015).

Capability building

There seemed to be no rest for the Rwandan government as it endeavoured to remove roadblocks in the way of SMME development. To this end, the International Finance Corporation (IFC) ramped up its support for SMMEs. The IFC launched an online training programme and business solution centre that would help Rwandan SMMEs to develop entrepreneurship skills and build stronger businesses, (Supporting Smaller Businesses in Rwanda, n.d.).

Changing models…

Rwanda has embraced the new model of business development purported by renowned strategy thought-leader Michael Porter.

Focused strategy…

“The secret is to gang up on the problem, rather than each other.” – Thomas Stallkamp

The RDB promotes collaboration in SMME development by different stakeholders. Most important is the collaboration among SMMEs within a cluster. According to Akamanzi, “When SMEs work collaboratively within a cluster, they have new market opportunities, and this increases learning.”

Hide it under the bushel; no…

The positive ripple effect of the Rwandan government’s will to transform the nation has created unique national attributes (a country free from corruption, clean and secure, a promising regional leader in ICT, a central location in Africa, etc.) that support business growth and elevates Rwanda to the “Switzerland of Africa” (Porter, n.d.).