Rwanda: Experts Weigh in on Creation of New Investment Ministry

The creation of the Ministry of Public Investments and Privatization will play a key role in curtailing losses from government investments while at the same time providing a better and efficient oversight for better results.

This is according to Prof. Herman Musahara, an economist, who told The New Times on Sunday that there are several mega public investments in Rwanda that needed proper management.

"In a developmental state that is renowned globally to lead in economic growth, public sector investment still has a remarkable role to play," he added.

Musahara was commenting on the implication of the new ministry approved, Saturday by the cabinet.

Eric Rwigamba, who was until a few days ago the Director General in charge of Financial Sector Development in the Ministry of Finance and Economic Planning, was over the weekend appointed by President Kagame to head the new ministry.

The new ministry will now focus on public investments that are profit oriented, according to a brief released after the announcement.

Key responsibilities include, among others; identifying opportunities for government investment, monitoring performance of the existing government investments in various companies and implementing privatization of public investments where necessary.

This, according to Musahara, comes at a time when development roadmaps like NST1 and Vision 2050, and recovery from the Covid-19 pandemic need strategic investments to sustain growth.

For Teddy Kaberuka, another economist based in Kigali, there is something very urgent: this ministry should prioritize investments done by different government institutions, for example districts in food processing factories, among other projects where government invests a lot of money.

"To cut down these losses, there is need to operationalize investments already done and are still idle for instance in the infrastructure sector."

Kaberuka further urged that this is possible under an investment protocol.

"There are also some projects where government has heavily invested including expanding the national carrier RwandAir as well as MICE tourism infrastructure such as the Kigali Convention Centre (KCC), and the BK Arena, which are big investments that need to be well managed in order to yield profit."

But also government should devise Public Private Partnership mechanisms giving an opportunity for joint venture with the private sector, he said.

"At a time where government has heavily invested in various sectors having a specialised ministry provides clear management and clear guidelines, and avoid elephant projects," he added.

Private sector speaks out

Speaking to The New Times in an interview, Robert Bafakulera the Private Sector Federation chairperson expressed confidence that the move will not create competition between government and the private sector.

"It will only do what the private sector cannot do. I think it can also jointly invest with the private sector."

He added, "So the part of public investment will be under this ministry. Then those investments that will be ready for private sector or which government is not managing well will be sold to the private sector."

Bafakulera asserted that privatisation has always been there.

"I think the reason why the government is coming back is because it is seeing some gaps here and there and this is a strategic plan."

Rwigamba was appointed together with Yvonne Umulisa as the Permanent Secretary in the new ministry. Umulisa is a trained economist who has been working as a policy analyst in parliament.

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