Celestin Rwabukumba is the fresh-faced father of the Rwanda Stock Exchange. Every morning he breezes into work in Kigali with business in his head and the fragile future of one of Africa’s newest stock exchanges in his hands.
“As a country, the sky is the limit,” he says.
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At the age of 39, Rwabukumba must be one of the youngest stock exchange leaders in the world.  Despite his tender years, in business at least, Rwabukumba has every justification to call himself the sage of stock trading in Rwanda. His story is as remarkable as that of the tiny exchange.
Rwabukumba is a survivor of the genocide in Rwanda in 1994. He lost most of his family, including his father, who died in the 100 days of madness that claimed more than 800,000 lives. Like many in Rwanda, he is reluctant to dwell on the horrors that visited upon his family and I do not have the heart to ask him.
What is clear is that Rwabukumba fled his country to the United States where he studied at the University of Buffalo, near New York, and earned a degree in economics. He became a stockbroker in New York and worked on Wall Street.
In 2004, came the call from home and Rwabukumba returned to Rwanda to work on a project to set up capital markets. It bore fruit in 2008, when Rwanda set up a rudimentary over-the-counter exchange, with a whiteboard and marker pens that you only see in schools these days.
On January 3, 2011, the Rwanda Stock Exchange was born in the brand new high-rise building that towers over Kigali. The building itself, is a symbol of the triumph of capital over disaster.
“For many Rwandans, like me, it has made us stronger as a nation. We are a resilient people ready to fight for a better future,” says Rwabukumba.
The RSE may be a speck on the African capital landscape, but it is growing in strength. It must be one of the few exchanges on earth where you can list the listings in one short sentence: NMG, a cross listing from Kenya; KCB, a Kenyan bank; Bralirwa, a brewery in Rwanda and the Bank of Kigali.
Trading is growing slowly; the marker pens are still there. The exchange plans to go electronic in December.
Every day the traders, in their bright red jackets, write out trades that it would take merely seconds for other African exchanges to notch up. In 2011, the RSE traded an average of $131,000 a day; in 2013 this has more than doubled to $292,000.
“My dream is for a big telecommunications company, like MTN, to list here. That would bring more capital and confidence to our market here,” Rwabukumba says.
Rwanda appears far from short of confidence as it emerges from the kind of hell that it has taken other countries in Africa decades to recover from. For the last 10 years, a time when the economies of the world struggled, Rwanda’s economy has grown by an average of 8.2%, according to finance minister Claver Gatete.
“This year, we are predicting 7.5% at the very minimum,” says Gatete.
Gatete, a former ambassador to London and head of the National Bank of Rwanda, took the job of guiding his country’s economy in February.  He says the key to success is the country’s stability and its prudent economic policy that has made it the third easiest place to do business in Africa. The country has fast internet and a will to do business. Credit card giant Visa gave Rwanda a vote of confidence by choosing the country for one of its credit card programs.
“We have come a long way, we have reached the bottom, the only way to go up is to make sure we take ownership of the growth of our economy and sustain it,” says Gatete.
You can register a company in Kigali in six hours and move your money in and out freely. Inflation, in the years after the genocide, was as high as 65%, now it is down to single figures.
Rwanda is also pushing forward the East Africa Community, the trading bloc of one of the fastest growing regions in the world. It has helped speed up trade across it by removing cloying weighbridges and bureaucracy; at the same time bringing in ICT to reduce clearing times.
Corruption is low and the country’s president Paul Kagame has built strong institutions in Rwanda to ensure it doesn’t get a foothold. In many ways the erudite and pragmatic Kagame, who talks like a CEO, has worked hard to shape the country into Rwanda Inc. It was he who encouraged many skilled Rwandans to return home and it is he who sees toughness as the only way to run his country. Legend has it that Kagame has appeared in person in government offices to fire corrupt officials.
“I don’t know about that, but he can fire you across the table in a meeting,” chuckles one of the Kigali inner circle.
When Rwanda struggled to sell its low quality coffee, Kagame brought in a team of United States agronomists to work out how the country could turn it into super-premium grade for export. Commodities, including tea and coffee, now make up more than three quarters of export earnings.
The streets of Kigali are clean and without potholes. Every month, Rwandans, including the president, take a few hours out of their day to clean and repair their neighborhood. Crime is also low among a people who appear exceedingly weary of conflict.
This dedication to order and business reflects on the Kigali skyline. The so-called land of a thousand hills is well on the way to becoming the land of a thousand cranes. The capital, once smashed and littered with dead, is rebuilding from the ground floor upwards. I have been traveling to Kigali since 2005 and was heartened to see new hotels, a sign that strong investment is on the way and accommodation prices could soon be on the way down.  I also saw one of the hotels had a lucky red Chinese lantern hanging from the scaffolding.
The rise from the ashes by the economy of Rwanda has been a remarkable story, but there are problems too. There is a lack of skills and the country’s small coffers are likely to struggle to buy all of the resources and equipment needed for a growing economy. Most of Rwanda’s 45 million people crowd onto scarce land and live from subsistence farming.
Maybe the biggest threat to the investor-friendly stability that Rwanda is trying to build comes from outside its borders. In the unstable eastern region of Goma, in the Democratic Republic of Congo, insurgents fight a running war. A number of donors cut off aid this year after accusing Rwanda of supporting the M23 rebels in the DRC. Rwanda denies this strongly. Gatete hopes private money will replace lost donor funds.
“Rwanda believes that in order to succeed peace is very, very crucial, that is why, when it comes to the DRC, we are the first to support the peace, and we believe that a solution is a regional solution working with the DRC government,” says Gatete, when asked by FORBES AFRICA about the allegations.
At home, many in Kigali say opposition is discouraged, to say the least. Two Rwandan journalists emerged from prison in August after completing a three-year jail term for what the courts called divisionism, genocide denial, defamation and incitement to violence. The two had written a series of articles critical of the government.
“The whole world is not homogenous. We cannot cut and paste democracy for something to look good. It has to work for us. We do not have the kind of democracy where we have a politician saying one thing and then the next day the opposition goes on the radio to say it is wrong. We have a parliament where all members can give constructive ideas,” says Vincent Karega, Rwanda’s ambassador to South Africa.
There is also the question of who will lead Rwanda when Kagame completes his term in 2017.
For the future, Rwanda is banking on ICT and the services industry. Kagame has studied the Asian Tigers and wants to make Rwanda the Singapore of Africa. The country has invested in hundreds of schools and colleges in an attempt to train a workforce capable of making this dream happen.
Many African countries could take a leaf out of Rwanda’s book when it comes to building an economy. True, Rwanda is a small country where it is easier to carry out sweeping changes among a people who are steeled to suffer for a better future by the violence and upheaval that befell their forebears. Taking that into account, there is no reason why many other African nations could not equally take advantage of the free market forces that Rwanda is unfettering by welcoming investors, fighting corruption and speeding up the internet.
Looking ahead, could there be a problem if the government in Rwanda feels it has lost control of its country to wealthy foreign investors? Unlikely, while this generation of politicians rule the roost.
“We want that,” says Gatete, “We need the private sector to be with us to build our economy… This is inclusive of the economic growth that is touching the lives of everybody and everyone is seeing the benefits of what the government is doing.”
It appears Rwanda Inc. is likely to be open for business for a long time to come.

Rwanda Inc. Rules In The Land Of A Thousand Cranes

In 1983, Gerard Sina, who didn’t finish school, set about trying to make something of his life. He lived with his parents on a farm, in a small town called Nyirangarama, in Northern Rwanda. One day, it dawned on him that the travelers between Rwanda’s two biggest cities—the capital Kigali and Gisenyi in the West—had nowhere to stop for refreshments during their four hour journey. He set up a small stall of baked goods that he sold to tired and hungry travelers.
Sina used a simple, but effective, marketing method to entice patrons. He offered travelers free samples of his food. Unable to resist, they quickly become accustomed to a place to get second wind on their journey. Soon the roadside stall became a regular fixture on the well-traveled route.
Then Sina found a way to produce his baked goods at a more industrial level. His little roadside stall became a 24-hour pit stop. Now travelers were flocking in around the clock. Whatever Sina lacked in formal education, he made up for in raw business talent.
His second stroke of genius came in 1999, when he discovered the riches that lay within the belly of the passion fruit. He developed a new method to extract juice to make concentrated syrup that he bottled and sold in bulk. Today, Agashya, literally translated as ‘something new’, is the first of Sina’s iconic Rwandan brands.
The second creation was Akabanga. ‘The secret’ is an oil-based chilli sauce that has changed the way that Rwandans eat. Before Akabanga, Rwandese food was traditionally bland, seasoned only lightly with salt and some herbs, but today Akabanga is a fixture on the dinner tables of the country.
These products, which are also exported in small quantities to the rest of the East African Region, Europe and North America, have set him on the way to recognition. His mother company, Urwibutso Enterprise, won bronze for Best Exporter at the Rwanda Development Board Awards in 2009. The ceremony is held annually to pay homage to the best performing companies in the various Rwandan industries.
Sina has been the recipient of several other awards including; the Arch of Kigali in the gold category for technology and quality in 2006 in Frankfurt, the Legatum Pioneers of Prosperity Awards for Entrepreneurship in 2007 in Kigali, and more recently in 2011 in London at the Business Initiative Direction Award in the diamond category for business management, excellence, quality, technology, innovation and expansion.
Along with an eye for business, Sina has an inquisitive nature.
On a trip across Europe, Sina saw some farmers playing music to their pigs. Intrigued, he reasoned that music makes people happy and brightens even the dullest moments, so the same could be true for pigs. When he returned to Rwanda he set about experimenting with his own pigs. He went as far as having a control group of pigs that were not exposed to music during the experiment period.
He found that the pigs that were exposed to music were indeed happier at the end of the experiment; they ate more, grew faster and fell ill less often than the ones in the control group. Now, he plays music to his pigs every day.
On another trip to Europe, he visited a vineyard and an orchard, again intrigued; he decided to grow apples and grapes, fruits that are not found in Rwanda. He now makes red wine and supplies apples to stalls in the local produce market.
Another quintessential African solution that Sina has adapted from his many travels is to ensure that he always uses locally grown raw materials. Having lived the life of a small scale farmer himself, he knows the day-to-day hardships that they often face. The count of local farmers he employs is 3,000 and growing. He trains them and provides seeds and fertilizer and in return they sell their crops exclusively to him.
Gerard Sina shows his allegiance to Rwanda and to her culture in many ways, the most notable being the naming of his products—they all have Rwandese names. He wants people in the export destination countries to marvel at these exotic names and to ask “what language is that?” or “what does that mean?”, thus creating a mystical aura around Rwanda and her people.
All of this in a country that wants to develop its information and communications technology (ICT) sectors to become the Singapore of Africa, and move away from farming.
“Agriculture comes first, because the most successful countries are those where people can eat,” he says.
Sina’s journey through life and business has not always been easy. During the 1994 genocide his young business was completely destroyed, he lost everything but the land where he toiled. Since he has always believed that giving up is an act of cowardice, building his business back up from scratch was something that simply had to be done.
His advice for young people who are rebuilding Rwanda is to not be afraid to share ideas and add value to Africa’s raw materials. For Africa as a whole, Sina believes that the answer to prosperity on the continent lies in adding value to raw materials.
“Do not just grow strawberries to sell them at the market. Make jam, juice, yogurt and cosmetics. This way, more can be charged for the finished product and more profit can be made. This profit can then be used as additional capital for the business and to provide a better life for all involved,” he says.
This approach has contributed greatly to Urwibutso Enterprises, making profits around the million dollar mark in the past two, very difficult, post-recession years.
Sina is adamant that Africans should take a page out the West’s book. More emphasis should be put into becoming self-reliant, rather than relying on international aid. He would rather not give his fellow Africans fish, but teach them how to fish. That way they will never go hungry.

The Entrepreneur Who Saw Profit  In Making A Pig Do A Jig

In Kinyinya, a growing residential area in North East Kigali—the Rwandan capital, entrepreneur Charles Ashimwe, is testing a new construction model for homes.
The model, explains Ashimwe, is one big house divided into two smaller houses by a wall. Each house will have a garden, parking for two cars, two bedrooms, seating room, kitchen, two toilets, running water and prepaid electricity.
Ashimwe’s approach is new because, usually, Rwandans people take pride in big houses, big land and big cars.
This love of big things, Ashimwe says, is dying out and more people are looking for property that suits their needs and pockets. This makes Ashimwe’s model attractive to the new rising middle class.
Rwanda is witnessing a boom in the middle class—the class of salaried elites and owners of small and medium enterprises—a sign of a society on the move, according to a new report by the African Bank of Development (AfDB).
The report, The Middle of the Pyramid: Dynamics of the Middle Class in Africa, shows that the number of middle class Africans has tripled over the last 30 years to 313 million people—that’s more than 34% of the continent’s population. It attributes the increase in size and purchasing power of the African middle class to strong economic growth and a move towards salaried jobs and away from agriculture.
In the 1980s and early 1990s, the report says, recruitment into the middle class resulted in a small percentage of poor households becoming better off and entering the middle class. This trend, it adds, accelerated slightly during the period 2000 to 2010 when more poor households moved into the middle class. At the same time, the 2000s witnessed a recruitment process from the rich class into the middle class, implying a slight improvement in income inequality. However, income inequality in Africa remains very high. About 100,000 Africans had a net worth of $800 billion in 2008 or about 60% of Africa’s GDP or 80% of sub-Saharan Africa’s.
In Rwanda, the rise of the middle class is driven by consistent sound economic growth and a stronger private sector capable of creating jobs and paying good wages. Per capita income increased from $220 in 2000, to nearly $600 in 2011.
Poverty levels have also gone down significantly and foreign direct investment (FDI) has increased at a faster rate. In 2011, Rwanda expected $550 million worth of private investments from $380 million in 2010.
This means a larger middle class in Rwanda—an attraction for banks, insurance companies, housing developers, telecoms, retail stores, hotels, bars and restaurants.
So far, two of Kenya’s largest banks—Kenya Commercial Bank (KCB)—the largest in East Africa in terms of assets and Equity Bank—the largest in terms of bank accounts—have opened subsidiaries in Rwanda to tap into the growing demand for luxury lifestyles. Home-grown banks like Banque Populaire du Rwanda (BPR) and Bank of Kigali have also started designing loan products targeting the middle class.
There is a growing partnership between banks and retail stores to allow bank customers and staff to access goods such as household items on credit. This partnership is equally boosting retail stores and manufacturers.
Kenya’s retail giant, Nakumatt, which opened its first store in Rwanda in 2008, has opened a second outlet in Kigali to take advantage of this growing middle class.
Electronic equipment manufacturers such as Samsung, LG, HP, Nokia and Apple have all opened stores in Kigali and are impressed with sales so far. Visa, the payment-processing giant has also entered into a partnership with the Rwandan government to introduce electronic and mobile payment systems and internationalize Rwanda’s ATM network.
But the growing demand for goods and services is putting strain on housing, roads, water and electricity supply.
In Kigali, which accommodates one million people, demand for housing units is enormous. It is estimated that 10,000 houses are needed each year, but fewer than 2,000 are being built. This has pushed rents up.
Rwanda also faces a shortage of electricity, which is hampering this growth. Power supply is around 100 megawatts, but the government has plans to generate 1,000 megawatts by 2017. It would be wise to hurry up.

Rising Middle Class Running Out Of Road

Rwanda’s post-genocide recovery has gone through many hands, but there is one big hand to reckon with—that of entrepreneur Said Sekoko Hatari.
Hatari may not be the richest man in Rwanda, but he is among Kigali’s cash kings. Born to a poor family, he grew up in Uganda as a refugee. One of the bitter legacies of Rwanda’s troubled past is that many of its people grew up sheltering outside the country.
Exile was where Hatari started in business, at the tender age of 20, as a truck driver working for Somalis. He was transporting construction materials from Kisumu in Kenya to missionaries living nearby. He quit the job to trade spare parts and coffee. He made mistakes along the way, including losing $1 million in the coffee business.
More than 30 years on, Hatari, who also served in the Rwandan army, is the king of hospitality and construction in Kigali with a number of business partnerships at his elbow.
“In partnerships, people come with their own money and borrowing connections. When you are alone, you get exhausted,” he says.
Hatari is the executive director of Doyelcy Ltd, founded in 2006, one of the largest firms in Rwanda and under valuation by Ernst &amp; Young. The company may list on the Rwanda Stock Exchange or issue a corporate bond to raise capital for investment in its core businesses of hospitality, property, insurance, renewable energy and agriculture.
Doyelcy is co-investing in hospitality and construction projects in Rwanda along with Dubai World, Chinese investors and Sudhir Ruparelia, one of the richest men in Uganda.
The prime project is the Kigali City Tower, which will be the tallest building in Rwanda and a potent symbol of reconstruction less than two decades after dead bodies littered the streets.
The 1994 genocide took more than 800,000 lives in 100 days. It shattered the country’s infrastructure, as well as its soul. From roads to government offices, private businesses and homes, to water pipes and electric poles—the country needed huge investment to build afresh; money that the government did not have.
Seventeen years later, Rwanda is one of the world’s success stories, with an annual average growth rate of about 8%. It was ranked the top global business reformer in the World Bank’s Doing Business Report in 2010. This was the first time a country from sub-Saharan Africa—the region with the highest poverty levels in the world—won such an accolade.
The tower of Kigali is a bold manifestation of this surge of confidence. It will bring scarce high-end office and retail space to Rwanda as the country plans to position itself as the business-friendly Switzerland of East Africa. Tenants are signing up for 20 floors; they include Rwanda’s plush coffee shop, Bourbon Street; Apple; Kenya’s Nakumatt; and South Africa’s Mr Price.
Ernst &amp; Young valued the tower at $33 million, which also makes it the most expensive landmark in Rwanda.
In another project, costing at least $200 million, Doyelcy is also co-investing with Ruparelia in a modern tax park and commercial buildings in Kigali. Then there is a $60 million five-star hotel with Chinese investors. The 254-room Kigali Marriot will be the largest hotel in Rwanda.
This year, the Central Bank says the economy may grow by more than 7.5%,  with strong recovery in the agriculture and service sectors, in a land where it takes one day to register a business. Inflation is easing and the financial sector grows stronger as more regional banks set up shop in Kigali.
This year, Rwanda expects investments to grow to $550 million, from more than $300 million last year.
Construction and hospitality are the fastest growing sectors in the country. In the first six months of 2011, construction rose by 54.6% compared to 28.7% for the same period last year.
“I believe that the future of this economy is mainly its expansion, going beyond borders as it reduces trade obstacles and introduces new markets,” says Hatari.
Although the construction sector is growing, Hatari says it faces setbacks from a lack of skilled labour and construction materials like cement. There is also a question over long-term finance from the banks.
“Finance is still a challenge and I think it will remain a challenge,” he says.
The good news is that Rwanda relishes a challenge.

Tag: Kigali

FORBES AFRICA SOCIAL MEDIA

Rwanda Inc. Rules In The Land Of A Thousand Cranes

The Entrepreneur Who Saw Profit In Making A Pig Do A Jig

Rising Middle Class Running Out Of Road

From A Truck Driver To A King Of Kigali