Rwanda’s Service Sector Strong, But Can It Produce Enough Jobs?

Rwanda’s Service Sector Strong, But Can It Produce Enough Jobs?

From TheAfricaReport. Story by Honoré Banda

When hammering out Rwanda’s national business plan, the drafters at the top of the ruling party are faced with stark choices.

The country is landlocked and lacks natural resources. Manufacturing and trade in goods is difficult even with perfect infrastructure.

The government’s Vision 2020 strategy is focused on Rwanda transforming itself from an agricultural to a knowledge-based economy.

“Technology is increasingly becoming part of the daily life of every citizen,” insisted President Paul
Kagame in his December 2014 state of the nation address.

The government wants Kigali to be a regional hub for high-value services in sectors such as technology, finance, tourism and real estate.
But will it work? Can the country gain enough critical mass to displace or complement other regional hubs like Nairobi?

…Rwanda’s service sector has been among the most dynamic over the 2007-2013 period, with wholesale and retail trade, education, finance and insurance, and transport, storage and communications all growing at average rates in excess of 10 percent per year since 2007, figures from the UN Economic Commission for Africa show.

The sector now accounts for half of Rwanda’s gross domestic product…

The Rwanda Development Board said that more than 70 percent of the jobs created in Kigali over the past decade have been in the services sector, particularly in sub-sectors such as telecommunications, finance and tourism.

However, a high proportion of this workforce is employed in low-productivity and poorly paid jobs on a casual basis and without access to the benefits of social security.

Read more at TheAfricaReport.