When it comes to any African country’s economic development, the question that always comes up in each and every sector is how governments and private sector companies can work together to accelerate their development.
The use of Information Communication Technologies (ICTs) has always been a crucial answer to most challenges but has always been costly for both government institutions and private firms to invest in.
Take a look at the commercial banks in Rwanda, most have, over the past few years had significant reductions in their net profit margins mainly due to their heavy investments in ICT.
But the returns of such investments are always high, most experts can attest.
Maurice Toroitich, the Chairman of the Rwanda Bankers Association and KCB Bank Rwanda Managing Director said in a recent interview that banks were investing in putting up more Automated Teller Machines (ATMs) around the country together with other banking technology which have increased their cost of operations.
However, banks will achieve an optimum level of investment at some point and begin to derive output from the investments,” Toroitich explained.
He noted that the sector’s growth will be driven by the more efficient facilities like ATMs, mobile and Internet banking, which will also therefore entrench a cashless economy culture in Rwanda
Other sectors like insurance companies are also investing in ICT infrastructure to ease their ways of doing business.
The government too is investing heavily in ICT. Take a look at the electronic billing systems for the Water and Sanitation Authority (WASAC) and the Energy Utility Corporation Limited (EUCL).
However, a better solution lies in Private Public Partnerships if Rwanda and other African countries are to progress with digitising their economies.
In the last Transform Africa Summit that took place in October 2013, more than 1,500 participants, including heads of state from seven African countries and executives from Microsoft, Samsung, Facebook and IBM graced the meeting and discussed ways on how Africa can leverage on ICTs to transform their economies.
“For us in Visa we consider public-private partnership a driver to achieve sustainable ICT growth. This partnership is very crucial for a country’s success,” said Kamran R. Siddiqi, Visa Group executive for Central and Eastern Europe, Middle East and Africa.
“There are many things we are doing in Rwanda courtesy of public-private partnerships; we have launched M-visa, and have tremendous support here to make it a reality,” Siddiqi said then.
Indeed, solutions such as mVisa have been a revelation to the national economy by increasing financial inclusion in the country and building on the country’s mandate of having a cashless economy by using electronic payment channels, which leaves banks to have higher cash deposits for private sector lending.
Another example is that of the 2013-announced Korea Telecom and Rwanda government partnership that has led to today’s unequalled Fourth Generation Long Term Evolution (4G LTE) service offing in the Rwanda.
Korea Telecom, through their Rwandan company Olleh Rwanda Networks, has been able to install and activate a wide-ranging high-speed broadband network and also lead the extension of the nation’s online services capability, which are essential to achieve Rwanda’s goals in the ICT sector.
The partnership now presents an unprecedented Public-Private Partnership which participants at this year’s Transform Africa Summit will be willing to emulate in Rwanda and beyond.