By Collins Mwai The young business community in Rwanda has decried persistence of specific challenges such as stringent tax regimes, access to capital, lack of access to skills as well […]
By Collins Mwai
The young business community in Rwanda has decried persistence of specific challenges such as stringent tax regimes, access to capital, lack of access to skills as well as lack of friendly policies.
Speaking at a roundtable convened by the Rwanda Development Board, young business executives called for a review of policies to take into account concerns of local operators.
For instance a section of emerging enterprises there is not enough awareness on tax policies and obligations by a large section of firms which often leads them to incur penalties.
Mbabazi said the forum is another effort to ensure that youths are provided with the right environment for growth. /Emmanuel Kwizera.
Other say that the tax regime does not take into account priority sectors that the government is trying to attract the youth to venture into.
For instance, Water Access Rwanda Chief Executive Christelle Kwizera questioned why water infrastructure was not part of the sectors eligible for 15 per cent Corporate Income Tax despite being a priority sector.
Further concerns were on the efficiency of Value Added Tax refunds system which has been said to hold up capital for firms.
Rwanda Revenue Authority owes about Rwf 30 billion to different members of the business community in value added tax refunds.
Other cited the ununiformed manner of implementation of tax policies largely owing to lack of understanding by RRA professionals.
Young investors also said that the ecosystem could use a review of export promotion efforts and initiatives which they said are not effective at the moment.
Gloria Kamanzi, the founder of Glo Creations, which is involved in fabrics, said that to match the national ambitions for exports, there is need to establish export facilitation support mechanism.
This, she said, would enable emerging entrepreneurs make the most of trade windows such as Alibaba to ensure increased access to global markets for local products.
Regis Umugiraneza’s the first Vice Chairman of the Private Sector Federation Chamber of Young Entrepreneurs also called for an intervention in entry requirements for sectors.
For instance, acquiring a tourism operation license, he said, requires as much as $1200, which is out of reach for a large number of start-ups and firms.
Other concerns include the absence of coaching and mentoring platforms for emerging players in the business community.
In regards to accessing capital for their ventures, Central Bank Governor John Rwangombwa said that is important to look beyond banks as the sole source of revenue as most have expensive loans. Noting that this was a consequence of risk factors and cost of banks’ capital, Rwangombwa said that as the local private sector capacity develops, there is going to be a growing interest by venture capitalists.
RDB Chief Executive Officer Clare Akamanzi, said that there are multiple opportunities for emerging through international Electronic-Trade Platforms like Alibaba which now has demand for products such as Avocados, pineapples, beef and chilli among other products.
She expressed their readiness to take in concerns by the youthful business community to improve conditions.
The youthful business community remains of significance to achieve targets such as job creation, GDP growth, reduction of imports and increase of exports.
RDB Chief Operating Officer Guy Baron said that the young business community has a role in the ambitions through ways such as increasing private investment to about 22 per cent to GDP from the current 13 per cent, creation of about 1.5 million jobs by 2020 among others.
The Minister for Youth, Rosemary Mbabazi, said that to achieve the higher middle income economy status, the economy needs a wide range of entrepreneurs, including the youth.
“For Rwanda to develop into a higher middle income economy as set out in Vision 2050, we need a robust private sector which need not only be composed of big investors but also young entrepreneurs who can tap into the many available opportunities. Both locally and regionally, there are many opportunities to tap into, especially in agriculture, manufacturing and in the service industry,” said.
Source The New Times