World economy

World economy

admin / December 14, 2018

Abstract

Global competitiveness is important in identifying a country’s stage of development and what it requires to move on. This paper considers world economic forum’s indices for 2010/11, in which Rwanda, was ranked 80th even though it is in the first stage of development. The paper considers Rwanda’s economic developments along with factors that have improved its growth. ICT project has been identified as one of such factors. The paper explores ICT and its benefits to the country’s infrastructural development.

Introduction

The world is continually shifting in economic dynamics with the world economic forum emphasizing the need for a better world. To achieve this, they have been encouraging countries, especially those in developing world to focus on development projects that would improve their status and hence better the state of this world.

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Global financial crisis that was witnessed has played a major role in dragging back economies which had started making progress like India and Rwanda, among others. Achieving these objectives has been worsened by the aftermath of economic crisis, which trickled down to major economies like the United States and the rest.

This has slowed major infrastructural developments as well as the focus on facing a looming global worming crisis. This paper will explore Rwanda, a country that has gone through turmoil ranging from internal conflict to economic difficulties but now stands stronger to emerge as a state a rapidly growing economy.

Global economy

Global economy concerns it self with the economic state of countries of the world. To achieve this, it considers the level of performance in businesses, societies as well as different governments of the world. They take it upon themselves to encourage and present challenging tasks to these groups along with charting ways of assisting them.

Countries are encouraged to focus on sustainable economic development projects that would mitigate global risks, spearhead development of viable infrastructure, and enhance health services that are accessible to all, as well as transform themselves into formidable economic powers.

In this regard, the World Economic Forum has strategically identified areas of great concern to countries and that require immediate attention to help spur economies into responsible capitalism. These areas include social development, health for all, economic growth, financial structures and environmental sustainability.

In dealing with the chosen areas of concern, specific objectives have been designed to spur each state of development. For instance in their quest for improved economic growth, the forum has chartered an objective of reshaping capitalism, promoting free flow of goods as well as people, rethink of infrastructural development as well as building and sustaining economic growth.

Factors such as Food security, global warming and economic crisis have made it much difficult to have sustainable food supply.

About one billion people are estimated to face food crisis and this does no go well with environmental sustainability. The forum for economic growth focuses on sustainable financial systems that are long term and of great benefit to countries; it therefore aims to strengthen financial systems and international monetary as well as ventures on mobile financing to help sustain lending.

Among key goals of the forum are to create and sustain accessible health services, this they have tired to achieve by fostering partnerships, dialogue along with advocacy. The other factor is sustainable social development that would encourage business growth.

These issues are evaluated yearly to determine their levels of improvement or otherwise with each country rated based on their developments and prospects. The results are usually published on an annual Global Competitiveness report coving all emerging economies. These rankings began in 1979 and have since continued to spur improvement in economies.

In this report countries are ranked based on their economic performance with each one placed on its most probable stage of development. 2010/11 report gave the highest number of countries occupying stage one, followed by stage 3, through stage 2, then to the transition between stages 1 and 2, and finally to the transition between stages 2 and 4.

This shows how difficult it is for countries to transit from one stage to another and that it requires great focus. This paper consider Rwanda, a country rated to be in stage 1, but making great progress especially in ICT to achieve sustainability.

Rwanda

Rwanda is a tiny country in the east-central Africa and is surrounded by Uganda, Tanzania, Congo DRC as well as Burundi. It has a population of about 11.2 million according to the 2010 survey.

Its population density is among the highest in the continent. It is a landlocked country and has a temperate climate with savanna being among the predominant vegetation. Its original inhabitants were the Twa, although they now make minority, with more predominant communities being the Hutu and Tutsi.

Rwanda has undergone great turmoil that ranges from internal conflict to economic instability. The genocide, especially, led to widespread deaths, looting of businesses, destruction of infrastructure and drop in cash crop farming that had been the country’s main economic drive. Their GDP dropped drastically as the conflict worsened.

About one million Tutsi and moderate Hutus are believed to have died in the genocide. Its ability to attract and sustain external and private investors was dealt a big blow. The GDP dropped to a record low of $390 during the conflict in 1994, but this has strengthened to $981according to 1998 results.

The 2010/11Global competitiveness report showed a great improvement in Rwanda with its global competitive index at 4.00 and ranked 80th, above countries like Egypt. This is very encouraging given its initial economic state after the war. Its improvement was noted as this marked its first entrance into GCI (Global competitiveness index).

This was mainly due to the strength of its institutions, which according to world economic forum are well-functioning. It has very low level of corruption and a very successful security that is conducive for business growth and investment (Transparency International 1).

Rwanda’s efficient labor markets as well as improved financial markets have spurred its rapid growth. It has also shown very high innovative capacity which is quite surprising given its level of development (World Economic Forum 10-50).

However, the country faces several challenges that may peg its global competitiveness if not tackled as quickly as possible. These factors include its poor telephony and electricity infrastructure which has slowed its otherwise encouraging economic growth, Poor health service program for its work force which has ranked it 130th with a life expectancy of just 50 years.

Other challenges include education in which very low number of enrolments into secondary schools and universities pose a bleak future as more influx of workforce is registered.

To spur further growth, the country needs to major on improving these weaknesses so as to have sustainable growth that would move them through the stages of development. It is expected that with continued growth, Rwanda will move through several stages of development to enhance its global competitiveness (Infoplease 1).

Development Projects in Rwanda

Rwanda’s service sectors are right on their feet after a challenging period during the 2000 recession. It ha s turned into the largest sector in Rwanda since 2010 and commands 43.6% of Rwanda’s economy. Perceived as one of the safest countries in Africa, its tourism sector has received a great boost.

The largest earner of foreign exchange is Tourism, which has booted the service sector in the country. Rwanda’s infrastructure is another area that is growing rapidly. After the war, Rwanda received aid from countries such as United States, Japan as well as the European Union, which has enabled it to invest heavily on infrastructure beginning with road networks.

Rwanda is progressing in its development of reliable infrastructures for electricity as well as telephony. However, the next level of growth that would make it more viable is none other than ICT infrastructure. This has been noted by the international community as well as their current president Paul Kagame, who has promised significant transformations to ICT infrastructure and development (Kagire 1).

ICT Project

According to Rwandan president, the best way to achieve socio-economic development in Rwanda is by developing ICT infrastructure throughout the country for easy access. In his statement, the president maintained that they can use available invention and innovations such as information technologies to move Rwanda thorough stages of economy.

Through ICT projects, the country expects to observe improved creativity, innovation, and entrepreneurship, among others. The country recognized importance of information technology to their economic competitiveness.

The Rwandan government has instituted several ICT projects throughout the country aimed at making access to information systems and technology easy. This has been boosted their partnership with the international community as well as private sector and non-governmental organizations (NGOs) to see to it that ICT development is a success (ACDI/VOCA 1).

Rwanda has a vision to become a middle income country by 2020; this vision is heavily pegged on ICT development and technology. The country’s remote areas are still lagging behind in communication technology, but this is what the country is working to change. The country aims to move into the 21st century information system and technology systems.

They are trying to achieve this by establishing more knowledge based ICT canters. Its ICT structures are still very weak with low tele-density, however the launch of two e-gov projects instituted in the country are steps towards ICT infrastructure development (ACDI/VOCA 1).

E-gov Projects

Rwandan government has established these projects with the main objective of improving service delivery to its citizen. They plan to use these projects as a way of reducing poverty through further improvements in internal governance. The government also uses ICT as an input for both transformation and development.

In this regard, the government has developed an ICT policy and Strategy that is aimed at assisting Rwandan information agency RITA to improve on standards. To achieve this, the government has instituted a strategic plan to train high ranking government officials on ICT and the internet, mid-level officials on telecommunications along with ICT and web information (Cannata 1-13).

They have also started training of other government staffs on basic computer literacy such as internet and email, among others. Furthermore, the government has instituted an elaborate plan to hire and send at least 10 graduates annually to gain experience on current ICTY practices with the United Nations, NGOs among others, to develop an innovative culture.

These projects have enhanced development of infrastructure which was noted as weak in the global competitiveness index. Improved ICT sector will definitely improve the country’s growth (World Economic Forum 10-50).

Benefits of Information and Communication Technology (ICT) to Rwandan Economy

ICT has led to development of infrastructure, which includes telephony, intranet, electricity and data link; this is expected to spur economic growth. Another benefit has been accessibility to tele-centers, computers and training, which has contributed to improved communication and knowledge for creativity and innovation (World Economic Forum 1).

Summary

World economic forum aims to better the state of this world. To do this, they encourage countries to improve their economies and assist them with innovative ideas as well as financial aid. To achieve economic sustainability, countries need to invest in their areas of concerns as much as they strengthen strong links.

Every year the World economic forum ranks countries based on their stages of growth, Rwanda was ranked 80th for the first time on their entrance to global competitiveness and has challenged other countries that lag behind.

Their institutions have been praised for functionality and their weak infrastructures are continually improving. Their focus on ICT to spur growth is already reaping benefits as communication networks improve leading to creativity and innovation.

Electricity is slowly moving into remote areas as e-gov project take effect as well as NGOs and private sectors. Rwanda’s economy is therefore benefiting from ICT projects as they improve their status globally (World Economic Forum 10-50).

Conclusion

World economic forum strives to enhance economic growth that is sustainable by encouraging countries, businesses and the society on ways of improving social welfare and mitigating global risks, among others. Rwanda was ranked 80th in the latest global competitiveness index and are employing emphasis on ICT to move through stages of development. ICT has made great impacts in Rwanda’s communication network and education with further improvement expected.

Works Cited

ACDI/VOCA. “Information & Communication Technology (ICT).” Acdivoca.com. 10.05.2011.10.05.2011. http://www.acdivoca.org/acdivoca/PortalHub.nsf/ID/ ourwork_ict

Cannata, Arleen. “Report from the Field: Two e-gov Projects in Rwanda”. Worldbank.org. 27.04.2005.10.05.2011. http://siteresources.worldbank.org/ INTEDEVELOPMENT/Resources/559323-1114798035525/1055531-1114798256329/1055556-1114798385191/Seed.ppt

Infoplease. “Rwanda: History, Governement, and Culture”. Infoplease.com. 10.05.2011.10.05.2011. http://www.infoplease.com/ipa/A0107926.html

Kagire, Edmund. “Rwanda: ICT Will Accelerate Development-Kagame”. The New Times. 09.05.2011.10.05.2011. http://allafrica.com/stories/201105100243.html

Transparency International. “Corruption Perceptions Index 2010 Results”. Transparency international. 15.12.2010. 10.05.2011. http://www.transparency.org/ policy_research/surveys_indices/cpi/2010/results

World Economic Forum. “Issues: World Economic Forum Issues”. World Economic Forum. 10.05.2011.10.05.2011. http://www.weforum.org/issues

World Economic Forum. “WEF: Global Competitiveness Report 2010-11”. World Economic Forum. 22.10.2010.10.05.2011. http://www3.weforum.org/docs/WEF_ GlobalCompetitivenessReport_2010-11.pdf

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