Ian Wood will help to develop Rwanda’s tea industry
By FRANK URQUHART
Published on Tuesday 22 January 2013 16:14- Scotsman
SCOTLAND’S second richest man has announced plans to invest a total of £7.5 million from his family’s charitable trust in the development of the tea industry in Rwanda in Sub Saharan Africa.
Sir Ian Wood, the recently retired head of energy giant the Wood Group, established the Wood Family Trust five years ago with an initial investment of £50 million.
But the trust’s annual report has revealed that, as a result of continued significant contributions by the oil tycoon, the funds in the trust now stand at approximately £114 million.
The trust, which also supports an initiative to develop tea farming by small holders in Tanzania., is already investing a total of £5.6 million on a six-year project, named Imbarutso, to aid 30,000 tea farmers in Rwanda by increasing their yield and income.
Bit Sir Ian, whose offer of a £50 million gift towards the transformation of Aberdeen’s Union Terrace Gardens was rejected last year by the city council, has now revealed that the trust is investing another £7.5 million to buy the majority shareholding in two tea factories, on behalf of about 12,000 smallholder tea farmers in Rwanda
The Rwanda tea factory purchase is being made under a partnership project between the Wood Family Trust and the Gatsby Foundation, Lord David Sainsbury’s philanthropic foundation. The eventual aim of the scheme is to transfer ownership of the factories to the farmer shareholders at no cost.
Professional management will be provided by the Kenya Tea Development Agency with Sir Ian acting as chairman. Sir Ian commented “This represents an innovative philanthropic intervention which, if successful and further developed, could transform the viability of smallholder tea farmers in Rwanda and pave the way for more smallholder farmers owning their factories across the region, which in turn will substantially increase the incomes of the smallholder farmer tea producers and their families.
“Experience in East Africa indicates that where the smallholder farmers own their own factories, they receive approximately 70 per cent of the made tea price against only 25 to 30 per cent if they simply sell their product to an estate owned factory.”
The trust is also planning to continue to invest in the UK through its Youth and Philanthropy Initiative which will be delivered in 81 schools across ten local authorities in Scotland.
The annual report states: “Sir Ian Wood has continued to contribute significantly to trust funds and, with the trust having spent about £13 million to the end of 2012, our funds going into 2013 are
approximately £114 million. “
The report also confirms that the Wood Family Trust spent a total of £1 million supporting the preparation and start up costs of the aborted city garden project and paying 80 per cent costs of the public referendum on the controversial scheme.
The report states: “Altogether, we will have spent more than £1 million and this is clearly a very disappointing outcome. However, the trustees judged this to be a high value transformational project for Aberdeen which would have facilitated the regeneration of its city centre with significant positive implications for the city’s long term economy. Thus the risk involved in providing the front end investigation and early design capital was deemed worthwhile.”
Microsoft’s Win 8 breaks language barrier in Rwanda
Rwandan authorities believe the availabilty of Microsoft Windows 8 in the country’s main language will help develop ICT literacy. (Image: GITEX)
The offering was launched in October last year and is said to be available in 109 languages, including 14 new languages.
This forms part of an effort by Microsoft to target a global audience.
Rwanda’s Minister of Youth and ICT, Jean Philpert Nsengimana, is quoted as saying that the availability of the product in Kinyarwanda will boost efforts to increase ICT literacy.
“It will help us in taking ICT to the common man. ICT has to be owned by every Rwandan and not be seen as a preserve by some,” Minister Nsengimana is reported to have told The New Times.
According to a Microsoft statement the application can support any of the languages with language interface – as long as it supports one of 12 application certification languages.
When a clergy professes a belief and lives to act, it often yields forth for the community. And for Zambian evangelist Joseph Ndashe, there was not a second day that he doubted the heights at which the education sector in Rwanda will rise.
“We’ll never go wrong if we invest in Rwanda,” the Bishop Ndashe had told leaders at a local church in Tennessee, Cleveland, after doing an assessment of the opportunities in Rwanda.
The Zambian only saw the roses in the education sector and today, he says there is no better time to invest in it than now, because new policies in the country are more than enticing.
Bishop Ndashe convinced the US-based Church of God World Missions to invest nearly Rwf450m in buying and renovating a secondary school in Niboye, Kicukiro district. This was after the mission’s initial plan to build a Rwf750m secondary school in the same region had failed due to registration pitfalls.
In 2011, the Church of God World Missions in Rwanda bought the formerly French-speaking general secondary education provider, Ecole Secondaire St. Patrick, at Rwf350m. The church, which by then was only registered in Kicukiro district, has turned St. Patrick into an A-Level technical school called Church of God St. Patrick Secondary School.
Bishop Ndashe, who is now the school’s administrator, said the government’s current education policy that focus on either technical training or general education instead of doing both is encouraging.
“We opted to go for professionals so that if the students fail to go to university they are able to use what they learned to go and get employment, that’s one of the things that attracted us,” he said. “And then there is no much interference from the government as long as you follow the right policy without breaching.”
He also said the shift to using English as the language of instruction in schools instead of French was another attractive point for his church because most of its trainers speak English.
The church’s investment in the school came as a relief for its former owners Anastase Sebudandi and associates who couldn’t afford to exclusively train students taking professional courses since they would lose money without students taking general courses in O-Level.
“We were going to cut the number of our students from 600 to 200 and that was not going to generate enough money to pay off our loans,” Sebudandi said. “We were failing to maintain the school.”
The church invested an extra Rwf50m to renovate classrooms, buy computer equipment, and increase teachers’ salaries. It is also planning to invest another Rwf50m to provide better computer labs and washrooms for the school.
Profits expected after five years
Bishop Ndashe says he hopes to make a return on his investment in the next five years. Focus will then shift to expansion to receive international students.
It all looks like a long shot given, but the prospects are rosy. Last year, the country’s target of students entering Technical and Vocational Education and Training (TVET) system was 40 per cent of all graduates of nine-year basic education, while the target by 2017 is projected at 60 per cent.
According to Pacifique Karinda, who oversees human capital and institutional development at the Rwanda Development Board, the current demand for TVET schools calls for more investment.
“We believe it’s a big opportunity for investors because this is a new system that is being implemented,” he said.
For the Church of God World Missions in Rwanda, Karinda could be preaching to the converted because it has already bought two pieces of land; in Gahanga, Kicukiro district, and in Nyagatare, inEastern Province, to expand its chalkboards.
December 13, 2012
Rwanda has been getting a lot of attention lately, but not the good kind. With the possible appointment of Susan Rice to replace Hilary Clinton as US Secretary of State, many media outlets are digging up one of the more embarrassing moments in recent history, as the Western world stood idle while a genocide unfolded in this small Central African nation. In addition, the recent siege of Goma by the M23 rebels has attracted a certain level of suspicion over Rwanda’s motives in the region, while others have defended its stance on the conflict.
But leaving these two angles aside for the moment, all this coverage has ignored a more interesting story: that the Rwandan government has actually implemented ideas that work, resulting in a small economic miracle. Should other African governments pay attention?
Having moved beyond the horror of the 1994 genocide, even if the West has not, this nation of 10-million is experiencing fast growth based on tourism and services despite a near total absence of mineral wealth. Averaging above 8% GDP growth for the past five years, more than one million Rwandans have been lifted out of poverty, according to the Rwanda Household Living Conditions Survey.
Unlike some other African nations who have struggled despite enormous mining exports and oil production, Rwanda’s business and service sectors account for two-thirds of GDP, having replaced agriculture. Tourism is a key part of the service sector, and multinationals are beginning to pay attention. Recently it was announced that Hotel giant firm Marriott is building one of its first three hotels in sub-Saharan Africa, with a 5-star, 250-room hotel in Kigali.
Marriott is eager to cash in on the promise of booming services, transportation, and logistics industries in the country, where thanks to strong education programs put in place by the government, foreign investors enjoy a particularly vibrant talent pool of recent graduates and experienced workers.
Rwanda has had more success than others in translating its economic growth toward solving social issues. The country has recorded a significant boost in the health sector where infant mortality dropped from 86 per 1000 live births in 2005 to 50 per 1000 live births in 2011. The strides made in the health sector have also spread to the use of contraceptives in a country with a very high population density, providing an improved public safety net against the threat of infectious diseases.
Infrastructure has been improving quickly. Households on the electricity grid have jumped from 91,000 in 2006 to 215,000 in 2011, according to government statistics.
Access to education improved sharply with primary school completion rates for 2011 reaching 79 percent for boys and 82 percent for girls, much higher than the overall targets of 59 percent and 58 percent respectively, while participation in secondary level education doubled from 2006 to 2011.
Instead of absorbing more and more donor aid without any visible improvement, Rwanda is actually taking less and less.
In 1995, donor accounted for 100% of the state budget, while today it is less than 40%.
The country is also trying to make some inroad in the technology sector, as Carnegie Mellon University has already opened a computer science training institute in Kigali, where ambitious young Rwandese gather to push forward an African innovation hub. The idea is that the university will be able to attract the brightest and most promising students and help build and support the nation’s IT sector to study in their own countries.
Rwanda is described by many experts as the most well connected country in Africa, boasting the fastest internet speeds on the continent. Thanks to this advantage, the government landed a crucial foreign investor with Visa, which launched a partnership with the state to develop a cashless economy.
Undoubtedly, many challenges remain for the political development of the country. The opposition complains of unfair treatment, while the authorities are often accused of meddling in the neighboring conflicts in the Congo, where untold wealths of diamond, gold, copper, and cobalt deposits are attracting many potential suitors from across the region and beyond, who are all positioning to be part of the opportunity.
But judging strictly by the social and economic progress achieved in the past decade, something is going right in Kigali, and that’s no small feat.
President Kagame in Hong Kong
President Paul Kagame yesterday called upon the Hong Kong business community to come and be part of Rwanda and Africa’s revival journey.
The Head of State made the remarks at a luncheon hosted by members of the business community in Hong Kong to discuss the multiple business opportunities Rwanda has to offer.
“I invite you to be part of the revival of not only Rwanda but Africa. We want to look at change in the general context of the East African Community to which we belong and of Africa,” President Kagame said.
Members of the business community who were from a variety of fields including the banking, energy and media sector were keen to learn more about Rwanda’s business environment, its educational system and the opportunities for investment in energy.
Introducing President Kagame, Marc Holtzman who also sits on the board of directors of the Bank of Kigali referred to Rwanda as a miracle story and described President Kagame as “a man with the vision that transformed Rwanda.”
Holtzman explained that he first learned of Rwanda’s progress when President Kagame addressed the University of Denver during his time as President of the University in 2004.
It is then that his vision of Rwanda changed from a nation marked by genocide to one of admirable socio-economic transformation.
Vivian Kayitesi, Head of Investment at Rwanda Development Board (RDB) explained to those present the progress that has led Rwanda to be ranked 3rd in Sub Saharan Africa at the recent World Economic Forum Competitiveness Report and the 8th easiest in doing business globally.
“RDB is dedicated to fast tracking Rwanda’s economic development by facilitating private sector investment. One of our recent accomplishments includes; decreasing the time required to open a business from 24 hours to 6 hours and procedures to obtain a construction permit from 30 days to 20 days.”
Addressing the question of education, President Kagame explained that the vision responsible for shaping Rwanda’s future, Vision 2020, was largely based on investing in the education of the youth.
“With youth forming the majority of the Rwandan population, Rwanda has prioritized education and the creation of a capable workforce in the country,” he explained.
President Kagame concluded by inviting the members of the business community to make the trip to Rwanda to witness the change that Rwandans have brought their nation. “Seeing is believing.”
o register Business in Rwanda now takes only six Hours. It has previously been 24hours. The registration process and the requirements remain the same.
Rwanda Development Board (RDB) last Friday announced the new reform as part of the comprehensive business reform agenda aimed at creating a foundation for making it much easier for the business community to operate in Rwanda.
The cost for registration remains at Rwf 15.000 (US$ 25) while online registration is free of charge. The Business Development Centres (BDCs) continue to facilitate business registration in the Provinces for clients who are unable to travel to Kigali.
“This proves the Government’s commitment to improve service delivery and ease doing business in Rwanda in order to further develop the Private sector,” said Louise Kanyonga, the Registrar General while officially announcing the change in time for business registration.
“We put the private sector at the forefront when we are reforming, therefore we are committed to reducing any possible hurdles they face,” Kanyonga added.
This was announced coincidentally during the study tour to RDB of Senators and Members of Parliaments from Africa, Europe and Development Partners from World Bank, IMF and ADB.
The Senators and MPs were in Rwanda on a 3day high-level meeting of international parliamentarians organised by the Parliamentary Network on the World Bank (PNoWB).
The conference dubbed “Private sector development in Africa: Cornerstone for sustainable growth,” was opened by the President of Rwanda, HE Paul Kagame and other notable key Speakers were Obiageli Ezekwesili, the WB Vice President for Africa; and Arnold Ekpe, the President of ECOBANK, Alain Destexhe, MP, Chair of the Parliamentary Network and Roger Nord, Deputy Director, IMF’s Africa Department.
The conference also discussed how countries can improve their ranking in international evaluations, notably in the global Doing Business report.
Most high ranking countries in the World Bank’s Doing Business report register their businesses in 8 hours. Rwanda currently ranks 8th in the world in the ease of starting a business considering the procedures, time, and cost.
The Doing Business Project provides objective measures of business regulations and their enforcement across 183 economies and selected cities at the sub-national and regional level.
Launched in 2002, the project looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle.
The business reforms are part of the government’s wider efforts to promote Rwanda as a business and investment destination, in order to drive the growth of the private sector and generate wealth.
Last year, one of the country’s largest banks, Bank of Kigali, listed its shares after a successful initial public offering. Rwanda also granted an operating licence in the country to Kenya’s Equity Bank.
Gatete also said Rwanda plans to reduce loan defaults in the industry to 5 percent of total loans in the medium-term, and cut non-performing loans in the industry to under 7 percent this year from 8 percent, to ensure the sector’s continued health.
Total outstanding credit by banks in the country stood at 509 billion Rwandan francs ($847 million) at the end of last year, he said.
Gatete said the main risks facing the country’s projected growth of 7.6 percent this year – from a forecast 8.8 percent in 2011 – stemmed from the euro zone debt crisis.
“It all depends on external shocks. We don’t know what is happening in the euro zone which is one of our big trading partner,” he said.
“We don’t know what factors will drive oil prices. It also depends on whether the famine in the Horn of Africa will persist.”
The projected growth for this year will be driven by the agricultural sector, tourism and exports, which grew by 53 percent last year to almost $400 million, Gatete said.
“We expect significant growth this year now that the government is making it a priority to support the export market,” he said.
Year-on-year inflation is projected to stay below 7.5 percent this year after hitting a high of 8.3 percent in 2011.
Gatete said the franc’s exchange rate would be stable to the dollar with market forces determining the rate.
“For us, we intervene when there is any kind of shock … we have sufficient reserves,” he said, adding the central bank holds hard currencies worth 7.7 months of import cover, far above the requirement of four months.
Rwanda is actively working to grow its tourism sector in as sustainable a way as possible and the efforts are succeeding. RwandAir’s fleet is expanding and new flights and airlines are coming.
RwandAir adds second B737-800 to its fleet, which will provide service to Johannesburg, Dubai and Lagos. With the planned 2015 opening of the new Bugesera International Airport south of Kigali, Rwanda is becoming well positioned to be a major transportation hub for Eastern and Central Africa.
- Turkish Airlines announced that they will launch a direct route from Istanbul to Kigali in April 2012. Kigali is their 18th destination city in Africa. A code-sharing agreement between Turkish Airlines and RwandAir will increase access even further. Turkish Airlines is a member of the Star Alliance, which includes Lufthansa and United Airlines.
- KLM launched service to Kigali via Amsterdam less than a year ago and now offers daily service via KLM and KLM/Kenya Airways.
- Ethiopian Airlines offers weekly service from London Heathrow via Addis Ababa.
- SN Brussels Airlines flies from Gatwick and Brussels to Kigali four times a week.
ARUSHA, Tanzania, October 19, 2011
More than 300 officers from the EAC Partner States Defense Forces are in Rwanda to take part in a joint command post exercise due to open Friday 21 October 2011.
The exercise codenamed ‘Ushirikiano Imara’ (loosely translated as Firm Cooperation) will be conducted at the Rwanda Military Academy at Nyakinama, Musanze District from 21-27 October and will involve civilians and military personnel.
It is meant to practice participants from the Partner States’ Defense Forces in the planning and conduct of peace support operations, counter terrorism, counter piracy and disaster management.
Brigadier General Salvator Nahimana, Chair of Defense Liaison Officers at the EAC Secretariat says the purpose of the command post exercise is to improve the capabilities of the Partner States’ Armed Forces to combat complex security challenges.
It will also seek to harmonize the working relationships and improve military interoperability between the EAC Partner States’ Armed Forces, Brig. Gen. Nahimana adds.
Furthermore, Ushirikiano Imara is expected to foster cooperation among the EAC Partner States and to enhance collaboration between the civil authorities in the Community and international organizations.
The EAC Partner States’ Defense Forces regularly conduct joint military exercises aimed at deepening cooperation in defense amongst the bloc’s member states, with similar exercises previously held in Kenya, Uganda and the United Republic of Tanzania.
These exercises are underpinned by a Memorandum of Understanding on Cooperation in Defense which lays down four areas of cooperation namely: military training; joint operations; technical assistance; and visits (including sporting exchanges and range competitions as well as visits by the Chiefs of Defense) and exchange of information. The MoU was signed in 1998 and revised in 2001.