Training and upskilling centers
Training and upskilling centers
Business Model Description
Further develop and operate training and upskilling centers offering different courses for adults and youth in key sectors and technical skills, such as tourism, manufacturing, agriculture and agro-processing and technology.
Expected Impact
Improve employment outcomes, especially for the young population whose livelihoods improve due to greater opportunities.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- Rwanda: Kigali
- Rwanda: Western Province
- Rwanda: Northern Province
Sector Classification
Education
Development need
Rwanda is significantly underperforming in SDG 4 - Quality Education and SDG 9 - Innovation, Industry and Infrastructure.(1) Rwanda needs to increase its investment in human capital to create the nation’s skills base, leveraging both traditional and non-traditional approaches. The learning outcomes are poor by both national and international standards, and mean years of schooling are only 4.1.(2)
Policy priority
Rwanda's government supports policies that encourage investment in services, because it can help the country acquire a competitive edge in the region.(3) Continued diversification away from commodity-based exports towards value added services is one of the key priorities for the strategy to decrease vulnerability to external trade shocks.(4)
Gender inequalities and marginalization issues
Rwanda’s inequality-discounted Human Development Index (HDI) value is 0.382, which puts the country in the low human development category.(2) Women are disadvantaged in the labor market, reflecting unequal learning (1) and few working opportunities (5). There is a need to improve women's access to services such as childcare to improve their incomes and a more active integration into the labor market.(6)
Investment opportunities introduction
The services sector will be the most important driver of economic growth, as 214,000 new jobs every year must be created for Rwanda to achieve upper-middle and high income status by 2035 and 2050, respectively (4). Rwanda also has potential to become an attractive holiday destination, with its beautiful national parks and rich cultural heritage.(7)
Key bottlenecks introduction
Investments in skills development are largely occupied by the public sphere and the non-profit sector.
Formal Education
Gender inequalities and marginalization issues
Women are significantly more likely to be out of the labor market than men (54% vs 35%).(10) In 2017, the unemployment rate for women (15.3%) was 2 times higher than that for men (7.8%).(11)
Pipeline Opportunity
Training and upskilling centers
Further develop and operate training and upskilling centers offering different courses for adults and youth in key sectors and technical skills, such as tourism, manufacturing, agriculture and agro-processing and technology.
Business Case
Market Size and Environment
126,165 adults (76,872 females) access adult literacy programs.
In 2016, Education Management Information System data indicated 126,165 adults (76,872 females) accessed adult literacy programs. In 2016, Rwanda had 394 Technical and Vocational Education and Training (TVET) providers, and 93,158 people were enrolled in those institutions. Enrolments have increased by 13.4% since 2012, indicating steady growth in the industry.(12)
Educated workers (those who have at least completed upper secondary education) constitute less than 25% of total workers in agriculture, retail and construction sectors.(10)
Indicative Return
15% - 20%
Benchmark statistics for the private education sector estimate return rates between 17% and 21%. This rate is a benchmark calculated as the cost of equity with a country risk premium, reflecting an average return required by investors.(13)
Investment Timeframe
Medium Term (5–10 years)
Due to characteristics of the business model offering upskilling services, the total investment timeframe should be perceived as medium term, exceeding 5 years, based on studied benchmark projects.
Ticket Size
< USD 500,000
Market Risks & Scale Obstacles
Business - Supply Chain Constraints
Impact Case
Sustainable Development Need
14% of Rwanda's labor force is unemployed and not actively building skills. The majority of jobs - 60% of employment - are in agriculture, retail and construction, which are sectors with relatively low incomes and low skill requirements.(7)
To complete its transformation to a middle income country by 2050, Rwanda must create an additional 5 million skilled jobs, indicating the need for upskilling and human capital development.(9)
Gender & Marginalisation
Rwanda’s inequality-discounted Human Development Index (HDI) value is 0.382, which puts the country in the low human development category.(2) Women are disadvantaged in the labor market, reflecting unequal learning (1) and few working opportunities (5). There is a need to improve women's access to services such as childcare to improve their incomes and a more active integration into the labor market.(6)
Expected Development Outcome
Improved human capital and opportunity to break out of poverty for poor and vulnerable groups
Increased numbers of skilled workers
Improved attractiveness of Rwanda as an investment destination, therefore translating into increased foreign investment
Gender & Marginalisation
Investments can help increase employment opportunities for women, improving their livelihoods.
Primary SDGs addressed
4.4.1 Proportion of youth and adults with information and communications technology (ICT) skills, by type of skill
4.5.1 Parity indices (female/male, rural/urban, bottom/top wealth quintile and others such as disability status, indigenous peoples and conflict-affected, as data become available) for all education indicators on this list that can be disaggregated
5.5.2 Proportion of women in managerial positions
Sending emails with attached files: 4.4% Using basic arithmetic formulae in a spreadsheet: 3.8% Connecting and installing new devices: 4.1% Finding, downloading, installing and configuring software: 2.2% Creating electronic presentations with presentation software: 1.5% Transferring files between a computer and other devices: 3.0% Writing a computer program: 3.0% (28)
Gender Parity Index (28) Nursery: 1.02 Primary: 0.98 Lower secondary: 1.17 Upper secondary:1.07 Gender Parity Index (GPI) in higher education: 0.74
Proportion of women in managerial positions: 34.1% (28)
N/A
N/A
8.5.2 Unemployment rate, by sex, age and persons with disabilities
8.5.1 Average hourly earnings of employees, by sex, age, occupation and persons with disabilities
Unemployment rate: 15.1% Male: 13.5% Female: 17.1% Youth: 18.7% Adults: 12.3% Persons with disabilities: 14.1% (28)
Aged 16-24 years: 30.7%; Aged 16-30 years: 32.7% (28)
N/A
N/A
Secondary SDGs addressed
Directly impacted stakeholders
People
Gender inequality and/or marginalization
Corporates
Public sector
Outcome Risks
A business model based on the high tuition fees may contribute to growing educational disparities within the Rwandan society.(17)
Training organized as a standalone event may not bring the expected results and fail to meet objectives.(18)
Impact Classification
What
Invest in upscaling current and new training and upskilling centers, in line with Rwanda's goals to promote access to education at all levels and to improve its quality.
Risk
Training organized as a standalone event may not bring the expected results and fail to meet objectives. High tuition fees may contribute to a growing education gap.
Impact Thesis
Improve employment outcomes, especially for the young population whose livelihoods improve due to greater opportunities.
Enabling Environment
Policy Environment
Technical and Vocational Education and Training Policy: This policy aims to address the skills gap in the economy and grow the share of skilled workforce in the labour market.(12)
Education Sector Strategic Plan 2018-19 to 2023-24: This plan targets quality of education in Rwanda, addresses the most significant challenges within the sector and establishes a strategy for Rwanda's transformation into a middle income industrial economy.(10)
Workplace Learning Policy: This policy identifies the shortage of relevant skills as a significant obstacle to economic growth and competitiveness. It analyses the development of Systems for Workplace Learning and identifies the preferred options for a solution design.(19)
Revised National Employment Policy: This policy identifies skills gaps as a major barrier to gainful employment and the transition from informal to formal employment. It encourages strong private sector involvement to address training and skills development issues.(20)
Rwanda Private Sector Development and Youth Employment Strategy: This strategy identifies employment promotion through skills development and entrepreneurship as a key intervention to increase firm-level productivity.(21)
Financial Environment
Fiscal incentives: For investments equivalent to at least USD 50 million, investors receive with a corporate income tax holiday of up to 7 years. Imported technical and vocational education training materials are exempt from value added tax.(27)
Other incentives: The government provides an accelerated depreciation rate of 50% over the first year of operations in Rwanda. Foreign enterprises that invest at least USD 250,000 can employ 3 foreign workers without performing a labor test.(27)
Regulatory Environment
Law No 36/2018 of 29/06/2018 Determining the Organization of Education: This Act describes the organisation of education, including partnerships in adult education and organisation of adult education facilities.(22)
Law Nº42/2016 of 18/10/2016 Establishing the Workforce Development Authority (WDA) and Determining Its Responsibilities, Organisation and Functioning): WDA sets up education standards, disseminates policies for training and upskilling and grants certificates to training and upskilling centres.(23)
Ministerial Order N°001/MINEDUC/2013 of 15/11/2013 Determining the Conditions for Granting Accreditation to a Private Institution of Higher Learning, Upgrading the Level of Teaching, Opening a College, a School, a Faculty or an Affiliated Research Institute: This order specifies ministerial accreditation requirements.(24)
Ministerial Instructions Nº 001 of 10/05/2017 Establishing Guidelines for Setting Up General or TVET Nursery, Primary or Secondary Schools Internal Rules and Regulations: These instructions provide guidelines for developing internal regulations and rules in education institutions.(25)
The Ministry of Education is the main regulatory body governing issues related to training and education in Rwanda, such as curricula and rules applying to education facilities.(26)
Marketplace Participants
Private Sector
AZTech, GLOMACS, 2KO Rwanda
Government
Ministry of Education (MINEDUC), Rwanda Development Board (RDB), University of Rwanda (UR)
Multilaterals
World Bank (WB), European Investment Bank (EIB), African Development Bank (AfDB), KfW Development Bank, UNICEF, United Nations Educational, Scientific and Cultural Organization (UNESCO)
Non-Profit
United States Agency for International Development (USAID), German Corporation for International Cooperation (GIZ), Rwanda Education NGO Coordination Platform (RENCP), Flemish Association for Development Cooperation and Technical Assistance (VVOB)
Target Locations
Rwanda: Kigali
Rwanda: Western Province
Rwanda: Northern Province
References
- (1) United Nations Development Programme (2020). Sustainable Development Report 2020. https://unstats.un.org/sdgs/report/2020/The-Sustainable-Development-Goals-Report-2020.pdf
- (2) United Nations Development Programme. Briefing note for countries on the 2019 Statistical Update: Rwanda.
- (3) Republic of Rwanda (2000). Rwanda Vision 2020. https://www.greengrowthknowledge.org/sites/default/files/downloads/policy-database/RWANDA%29%20Rwanda%20Vision%202020.pdf
- (4) Republic of Rwanda (2019). Voluntary National Review Rwanda 2019. https://sustainabledevelopment.un.org/content/documents/23432Rwanda_VNR_Document__Final.pdf
- (5) National Institute of Statistics of Rwanda (2018). EICV5 Thematic Report Economic Activity Thematic Report.https://www.statistics.gov.rw/publication/eicv5thematic-reporteconomic-activity-thematic-report.pdf
- (6) United Nations International Children's Emergency Fund (2018). UNICEF Rwanda Private Sector Engagement Strategy 2018-2023. https://www.unicef.org/rwanda/media/1236/file/2018-UNICEF-Rwanda-Private-Sector-Engagement-Strategy.pdf
- (7) Rwanda Development Board (2021). Visit Rwanda. https://www.visitrwanda.com/
- (8) World Bank (2019). Rwanda Systematic Country Diagnostic. http://documents1.worldbank.org/curated/en/219651563298568286/pdf/Rwanda-Systematic-Country-Diagnostic.pdf
- (9) Rwanda Development Board (2019). National Skills Development And Employment Promotion Strategy 2019 - 2024. https://rdb.rw/wp-content/uploads/2019/07/NSDEPS.pdf
- (10) Ministry of Education (2015). Technical and Vocational Education and Training (TVET) Policy. https://mineduc.gov.rw/fileadmin/user_upload/pdf_files/TVET_Policy__Final.pdf
- (11) National Institute of Statistics of Rwanda (2018). EICV5 Thematic Report Economic Activity Thematic Report.https://www.statistics.gov.rw/publication/eicv5thematic-reporteconomic-activity-thematic-report.pdf
- (12) Ministry of Education (2018). Education Sector Strategic Plan 2018-19 TO 2023-24.
- (13) PwC analysis based on Prof. A. Damodaran data, 2020.
- (14) United Nations International Children's Emergency Fund (2020). Education. https://www.unicef.org/rwanda/education
- (15) The New Times Rwanda (2014). Rwanda Out-Of-School Rate Down 85%. https://www.newtimes.co.rw/section/read/72719#:~:text=The%20Unesco%20Education%20for%20All,by%20increasing%20access%20to%20education.
- (16) Tuyisenge, G., Hategeka, C. and Luginaah, I. (2018). 'Continuing Professional Development in Maternal Health Care: Barriers to Applying New Knowledge and Skills in the Hospitals of Rwanda', Maternal and Child Health Journal. https://link.springer.com/article/10.1007/s10995-018-2505-2
- (17) Mohamed, S. (2020). South Africa's Broken And Unequal Education Laid Bare. Amnesty.org. https://www.amnesty.org/en/latest/news/2020/02/south-africa-broken-and-unequal-education-perpetuating-poverty-and-inequality/
- (18) Mchete, T. and Shayo, F. (2020). 'The Role Of Induction Training On Performance Of New Employees At Workplace: Case Study Of The Open University Of Tanzania', International Journal of Business Management and Economic Review.
- (19) Republic of Rwanda (2015). National Policy On Workplace Learning To Prepare Rwandan Youth For Employment. https://rwandatrade.rw/media/2015%20MIFOTRA%20Workplace%20Learning%20Policy.pdf
- (20) Ministry of Public Service and Labor (2019). Revised National Employment Policy. https://www.ilo.org/wcmsp5/groups/public/---africa/---ro-abidjan/---ilo-dar_es_salaam/documents/publication/wcms_715230.pdf
- (21) Republic of Rwanda (2017). Private Sector Development and Youth Employment Strategy (PSDYES) 2018-2024. PSDYE Sector Working Group Secretariat. http://www.minecofin.gov.rw/fileadmin/templates/documents/NDPR/Sector_Strategic_Plans/PSD_YE.pdf
- (22) Republic of Rwanda (2018). Law No 36/2018 of 29/06/2018 Determining the Organization of Education. https://mineduc.gov.rw/fileadmin/user_upload/pdf_files/Laws-New-Uploads/Education_Laws/ITEGEKO_NO_36-2018_RYO_KU_WA_29-06-2018_RIGENA_IMITUNGANYIRIZE_Y_UBUREZI.pdf
- (23) Republic of Rwanda (2016). Law Nº42/2016 of 18/10/2016 Establishing the Workforce Development Authority and Determining Its Responsibilities, Organisation and Functioning. https://mineduc.gov.rw/fileadmin/user_upload/pdf_files/Laws-New-Uploads/Education_Laws/N_42_2016_ryo_ku_wa_18_10_2016.pdf
- (24) Republic of Rwanda. Ministerial Order N°001/MINEDUC/2013 of 15/11/2013 Determining the Conditions for Granting Accreditation to a Private Institution of Higher Learning,Upgrading the Level of Teaching,Opening a College,a School,a Faculty or an Affiliated Research Institute. https://mineduc.gov.rw/fileadmin/user_upload/pdf_files/Laws-New-Uploads/Education_Orders/N_001_2013_ryo_kuwa_15_11_2013.pdf
- (25) Government of Rwanda (2017). Ministerial Instructions Nº 001 of 10/05/2017 Establishing Guidelines for Setting Up General or TVET Nursery, Primary or Secondary Schools Internal Rules and Regulations. https://mineduc.gov.rw/fileadmin/user_upload/pdf_files/Ministerial%20instructions%201652017.pdf
- (26) Ministry of Education. About the Ministry. https://www.mineduc.gov.rw/about
- (27) Rwanda Development Board. Incentives to support the Education sector. https://rdb.rw/investment-opportunities/education/#tab-1-3
- (28) Republic of Rwanda (2019). Voluntary National Review Rwanda 2019. https://sustainabledevelopment.un.org/content/documents/23432Rwanda_VNR_Document__Final.pdf
- (29) Ndangira (2021). Skills Development Fund call for grant proposals. https://www.ndangira.net/skills-development-fund-call-for-grant-proposals/