The Kigali City Tower (KCT) in Rwanda’s bustling central business district is a shining example of the country’s rise from the ashes of conflict, the tragedy that killed 800,000 in the genocide against the Tutsi 22 years ago.
The elevators of the high-rise KCT are busy, going up and down without respite as the day progresses.
On the first floor, they open to the Rwanda Stock Exchange (RSE), which on any given day is a hive of activity: young men and women in red blazers indulging in light banter on the trading floor, still using marker pens and dusters on the white boards in front of the reception area.
But this stock exchange of seven staff members is on its way to becoming fully-electronic.
“By the end of the year or even before that,” says the RSE’s Chief Executive Officer, Pierre Celestin Rwabukumba, a Rwandan national, seated in one of the glass offices to the left of the reception.
At 42, Rwabukumba is perhaps one of the youngest stock exchange heads on the continent, but it does not take too long to know this is a man on a mission to contribute to the economic development of the country he came home to 12 years ago after a stint on Wall Street in the United States.
An economics graduate from the University of Buffalo in New York, he decided to return home to develop industry in his own country.
“I decided to chip in,” says Rwabukumba, simply.
And he wears many hats. Also Chairman of the East African Securities Exchanges Association, he is Co-Founder and Chairman of the Kigali Cement Company, which produces, markets and sells cement in Rwanda and neighboring countries. He is involved in investment projects ranging from real estate, poultry and agro-processing to energy.
Yet, when the RSE was incorporated in 2007, in a small office on the fifth floor of the Ecobank building, Rwabukumba was the only employee – all he had was a blank paper and a desk to start with.
“I did everything myself, I was running the whole thing,” he chuckles.
The RSE was officially launched in January 2011 when it moved to its current premises and started with four listed companies. Currently, it has seven (three local companies and four cross-listed from the region) including Bralirwa, Bank of Kigali, KCB Bank, Nation Media Group, Uchumi Supermarket, Equity Group Holdings and Crystal Telecom.
The RSE has a market capitalization of $3.6 billion. The Nairobi Stock Exchange, the biggest in the East African region, sits at $21.24 billion.
“We are small and efficient,” says Rwabukumba.
“We are young, flexible and that makes us different. We try to be as innovative and tech-savvy as possible… We have had a lot of milestones; there is a lot to be proud of.”
The RSE operates in financial markets, corporate finance, investment analysis and portfolio management, international finance and business laws. It aims to lead Rwanda to become a regional financial center.
Robert Mathu, Executive Director of Rwanda’s Capital Market Authority (CMA), echoes Rwabukumba’s optimism.
“Rwanda is a very young economy compared to the rest of East Africa. We had to start from scratch 22 years ago. The country has registered consistently high economic growth,” he says.
In addition to the stock exchange’s efforts, CMA is promoting the capital market by creating awareness among the public, also motivating institutional reforms and development.
Mathu says the services industry is Rwanda’s next avenue of growth, those like financial services, logistics, tourism and ICT.
“It is the plan of Rwanda to use the wider East African market as a platform to access long-term capital and diversify economic growth into the area of services, away from the traditional areas like agriculture,” he says.
“We need to develop skills capacity, but we have a long-term plan and are in the process of developing a master plan.”
And this fits in nicely with Rwanda’s own overall master plan.

‘Small And Efficient’

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.

Tag: Rwanda Stock Exchange

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