As Rwanda grapples with the effects of COVID-19 and the economy adjusting to the new normal, the private sector needs more support than ever before.
Government argues that five months into the Covid-19 pandemic, businesses in Rwanda were affected although some are soldiering on and that recovery will not take long.
According to Robert Bapfakurera the Chairman of the Rwanda Private Sector Federation (PSF), “Tourism related businesses have been heavily affected but government has put in place a recovery fund to help hotels and air transport to resume.”
According to Zephanie Niyonkuru the Deputy CEO Rwanda Development Board, the recovery fund has several windows including one that is focusing on supporting hotels that were affected and this window will mainly provide opportunities for those that had loans to restructure them to at least 35% of the loan and bring it to a long tenure and an interest rate of around 5%.
“There are many other windows that are aimed at providing working capital to companies so that they can resume businesses as they recover from the losses caused by the pandemic and access working capital plus maintaining the jobs,” Niyonkuru explained.
Robert Bapfakurera explained that many of the companies are small and medium in size- the Economic Recovery Fund is meant to facilitate them and micro-finance institutions to work with banks to access funding,” Bapfakurera said Saturday during a Kiss FM radio talk show.
“In addition to that, the fund allows small companies to access guarantee for funding. We have put in place a clear communication strategy that will enable potential beneficiaries of the fund access all the information they need,” he said.
However, Bapfakurera notes that the Recovery Fund will not provide free money to businesses; but beneficiaries will access funds from banks at reduced interest rates.
“As for hotels and businesses in the hospitality industry, the fund will enable them to restructure the loans they had before #COVID19 and therefore have better repayment terms,” he said.
Speaking on how businesses have adopted to the new ways of working during the pandemic, Bapfakurera said, “The pandemic triggered high demand for essential goods like toiletries and hand sanitizers. Businesses are also adapting to digital ways of working.”
“Through digital solutions like mobile money, businesses are able to operate more conveniently at lower costs while also staying safe from COVID-19,” Bapfakurera said.
On investment focus, Bapfakurera said; “We are working to boost capacities of companies in manufacturing industry so that they can meet demand for goods, especially essential products. We are also encouraging investment in digital operations and e-commerce.”
ICT based businesses were not affected by the Covid-19 pandemic and actually the situation provided extra opportunities for them according to Seth Kwizera.