ICT powers Rwanda’s GDP with 35% all-time high growth in 2023

Rwanda’s economy defied global headwinds in 2023, recording an 8.2% annual growth in Gross Domestic Product (GDP), surpassing expert projections of 6.2% and solidifying its position as Africa’s fastest-growing economy, according to a report by the National Institute of Statistics of Rwanda (NISR) seen by TechGyant.

This economic performance was notably facilitated by the rise of the information and communications technology (ICT) sector in the country, which experienced a 35% expansion, the highest growth rate across all economic sectors in the year.

Fueling Digital Transformation

The ICT sector’s 35% growth validates Rwanda’s efforts to establish itself as a regional hub for technology and innovation in Africa. Over the past decade, the government has prioritized robust investments in digital infrastructure, skills development, and creating an enabling environment that nurtures entrepreneurship and innovation.

The country’s focus on the ICT sector is a strategic imperative, recognizing early on that leveraging technology would catalyze economic growth, job creation, and improved service delivery across sectors.

This mission has also manifested in initiatives such as the National Broadband Policy and Strategy with the main objective of enabling access to affordable and reliable internet services across the country and, most recently, a partnership between the Ministry of ICT and Innovation (MINICT) and MTN Rwanda to introduce IKOSORA+, an affordable 4G-enabled smartphone, as part of the Connect Rwanda 2.0 initiative to boost smartphone penetration across various districts in the country.

Also read: ICT Minister Rallies Rwandan Women in Tech to Impact the Future

Enabling Environment for Tech Innovation

Rwanda’s conducive business environment has been a major draw for tech startups and established players alike, including Norrsken East Africa, the largest regional hub for entrepreneurship in Africa. The country’s regulatory framework, supportive policies, and talent pool, coupled with incentives like tax breaks and access to funding, have facilitated a thriving tech ecosystem needed to compete globally. Kigali’s position as a regional hub for events like the Mobile World Congress has further cemented Rwanda’s reputation as a technology frontrunner.

Also read: Legal Documentation for Building a Startup in Rwanda

Sector Breakdown and Key Drivers

Per the GDP report analyzed by TechGyant, while the ICT sector stole the spotlight, other sectors also contributed significantly to Rwanda’s economic growth in 2023. The services sector, accounting for 44% of GDP, grew by 11%, driven by performances in wholesale and retail trade (9% growth), hotel and restaurant activities (18% growth), and transport (13% growth, with air travel at 29% and land travel at 9%).

The industrial sector witnessed a 10% expansion, fueled by growth in manufacturing (11%) and construction (12%), reflecting ongoing infrastructure projects and increased investment in manufacturing capabilities. However, the agriculture sector lagged behind, growing by only 2% due to challenges such as droughts and floods, although livestock farming saw a 7% increase.

Also read: How STEM is Building Innovators; First Lego League, Rwanda, 2024

Looking Ahead to Sustainable Growth

Rwanda’s economic diversification efforts reduced reliance on any single sector, built resilience against external shocks, and unlocked economic empowerment at the grassroots level. As the country looks to the future, continued investment in digital infrastructure, talent development, and an enabling regulatory environment will be key to sustaining the momentum in its ICT sector.

Moreover, leveraging technologies like artificial intelligence, big data, and the Internet of Things (IoT) across various economic sectors holds big potential for driving innovation, efficiency, and economic competitiveness.

As Rwanda is well-positioned to be at the forefront of digital transformation in Africa and create a vibrant technology ecosystem that promotes homegrown innovation while attracting global talent and investment, experts see its focus not just on headline GDP figures. Expert sources in TechGyant’s network familiar with national policies say the country’s government is equally invested in ensuring that economic growth translates into tangible improvements in the lives of all citizens and residents, particularly those in rural and underserved communities.