CONTRIBUTION OF ECONOMIC LOCALIZATION STRATEGY TOWARDATTAINING SELF-RELIANCE OF HOST COUNTRY: A CASE OF VOLKSWAGEN,RWANDA

Abstract

The research aims to analyze the contribution of Volkswagen's economic localization strategy in
Rwanda towards achieving self-reliance in the host country. This study employed a descriptive
research design with a mixed-method approach incorporating both quantitative and qualitative data
was used. The study targeted managerial-level employees at Volkswagen Rwanda, Mobility
Solution, and Corporation for Africa & Overseas, totaling 80 respondents. A census method was
employed for sampling. Primary data was collected via questionnaires, and SPSS Version 27 was
used for quantitative analysis, focusing on means and standard deviations of variables. The
findings of the study indicated that Volkswagen's investment significantly improved livelihoods
and socio-economic development in Rwanda. Although the local production line affected the
availability of brand-new vehicles, its impact on reducing imports was neutral. Workforce
development was found to strongly foster economic growth. The Analysis of Variance (ANOVA)
yielded a p-value of 0.003 and an R-squared coefficient of 0.579, signifying a significant
contribution of economic localization strategy variables towards self-reliance. In conclusion, the
study recommends exploring opportunities to expand the market for locally produced vehicles to
neighboring countries and forming strategic alliances to enhance production and market reach. In
addition, establishing innovation hubs focused on automotive technology and sustainability is
advised to foster innovation and attract talent. The significant findings underscore the importance
of economic localization strategies in achieving host country self-reliance.