BizCLIR

In many parts of the world, running one's own business is considered the height of success. People employed by enterprises owned by others long for the day when they can be their own boss. Entrepreneurialism is a virtue. In many countries, the will to start and grow a business exists, but bureaucratic obstacles and costs make it untenable. In other countries, including Rwanda, there is an added challenge: The population is historically not drawn to business.

The main challenge to starting a business in Rwanda is that the local population lacks the necessary entrepreneurial spirit. According to many public and private sector representatives, running one's own business does not mark career success in Rwanda in the way it does in many other countries. Rather, holding a steady job, particularly in the government, is considered optimal. This results from a long history of the government being the primary employer and closely controlling business until only about a decade ago. Accordingly, few Rwandans pursue innovative business ideas, and most entrepreneurs remain at a subsistence business level.

Rwanda is in the process of addressing each of the challenges to business start-up, and the government has taken several steps to increase its country's appeal as an investment destination. The registration process is being overhauled, privatization of state owned enterprises is well underway, and a legal framework on competition is being developed. Resources to assist potential entrepreneurs, large and small, in pursuing new business in the country have also emerged. Each of these developments is a strong step in the right direction and in laying the groundwork for a welcoming environment for business start-up. The focus now must be on implementing the laws effectively, publicizing new processes and resources for entrepreneurs, and ensuring that the responsible institutions have sufficient staff and resources to meet their mandates.

The BizCLIR indicator scores reflect the state of transition in Rwanda impacting the various factors of Starting a Business. As reflected in the graph at the beginning of this chapter, the legal framework, implementing institutions, and supporting institutions fall in the "moderately negative" range, indicating that there are many specific areas that warrant reform in the short-term. Social dynamics for Starting a Business, however, are somewhat more positive, indicating improving conditions, including the removal of roadblocks and growing interest in business formality.