Opening Doors, Unlocking Opportunity: How Refugee-Led Micro and Small Businesses Are Creating Economic Growth in Rwanda
Ciza Agricole and his business partner Damien Sibomana run a successful restaurant in the largest transit hub in Kigali and employ ten full-time staff. Ciza has taught Damien and his staff how to manage the accounting for the business and how to track inventory and sales. Damien, in turn, has brought expertise about the market, customers and experience in running a business in Rwanda. They plan to expand their restaurant in the next year to the second floor of their building, where they will be able to accommodate twice the number of customers.
Evariste Ndayirukiye also runs a business in Rwanda. An agronomist by trade, with ten years of agricultural business experience, he and his business partner tapped into their entrepreneurial spirit when they arrived from Burundi and began harvesting stevia. Evariste saw the value of working with Rwandans early on, particularly given their expertise on harvesting seasons, the local soil and climate. From a two-man show, Evariste’s company now employs a total of thirty seasonal employees and five full-time staff.
Both Evariste and Ciza came to Rwanda as refugees and now employ other refugees as well as local Rwandans in their businesses.
Their stories, similar to hundreds of other Rwandan refugees, demonstrate the positive contribution that micro, small and medium-sized businesses (MSMEs) can make on communities. They also shed light on how the integration of refugee and host communities can enable both to grow and develop together.
Rwanda, a small, landlocked country in East Africa, has the continent’s highest population density. Land is at an ultimate premium, yet the country is one of the world’s most progressive when it comes to policies for refugees; to date, it has opened its doors to nearly 175,000 people fleeing from neighboring countries. Integration has been central to Rwanda’s approach: from providing access to the nation’s universal healthcare system to schools that educate both nationals and refugees in the same classrooms. Refugees can even own land, open a bank account and move freely about the country.
The absence of barriers has enabled Rwanda to welcome the refugees as assets, not burdens; they are demonstrating that they can contribute significantly to the country’s development. Like Evariste and Ciza, many are using their skills and expertise to start MSMEs in their host communities.
According to the World Bank Group, there are between 365 and 445 million MSMEs in emerging markets. These businesses play an important role in generating income, alleviating poverty and contributing significantly to job creation. In fact, MSMEs are the largest provider of formal sector jobs across sub-Saharan Africa.
In 2016, the United Nations developed a new Comprehensive Refugee Response Framework (CRRF) that pushes countries to more comprehensively include refugees in host communities from the very beginning. Rwanda has adopted the CRRF, although policies and practices of integrating refugees had started long before the framework was in place. The results of the CRRF adoption are evident: the rise of entrepreneurship amongst refugees is leading to more jobs and economic growth – for everyone.
As part of the partnership between the Center for Inclusive Growth and African Entrepreneur Collective (AEC), we are able to address critical barriers to growth and enable refugee entrepreneurs the opportunity to grow their small businesses through training, tailored consulting and direct access to low-cost debt capital. This aligns with Rwanda’s openness to refugee entrepreneurship which supports and enables refugee SMEs to thrive while simultaneously creating opportunities for Rwandans to succeed.
Last year alone, AEC refugee MSMEs in Rwanda created nearly 2,500 jobs – 1,600 of which were jobs for Rwandans and 900 for other refugees. On a continent where 22 percent of the working-age population is starting a new business, continuing this trajectory will require more partnerships, particularly with the private sector who have access to valuable assets to drive inclusive growth. Rwanda is a shining example of how these partnerships can thrive in a system that promotes the integration of refugees.
In a world that’s increasingly turning inward, Rwanda’s story demonstrates how a spirit of openness and integration can have a positive impact on communities.