Rul­ing party’s busi­ness arm rules Rwan­dan econ­omy

Kuwait Times - - BUSINESS -

Rwanda’s rul­ing party has tightly con­trolled the po­lit­i­cal sphere for over two decades, but it is also ac­cused of mo­nop­o­liz­ing the econ­omy via its very own con­glom­er­ate: Crys­tal Ven­tures.

The in­vest­ment arm of the Rwan­dan Pa­tri­otic Front is the coun­try’s top pri­vate em­ployer, with as­sets es­ti­mated at $500 mil­lion (426 mil­lion euros). It is present in al­most ev­ery sec­tor, from food pro­cess­ing to pri­vate se­cu­rity, build­ing ma­te­ri­als and real es­tate. The com­pany, for­merly named Tris­tar, was born in 1995, a year af­ter the then rebel RPF seized Kigali and put an end to a 100-day geno­cide which left 800,000 peo­ple, mostly from the Tutsi mi­nor­ity, dead.

With the coun­try shat­tered and not a franc left in the trea­sury, the new au­thor­i­ties did not want to sit around and wait for a pri­vate sec­tor to ma­te­ri­al­ize and re­build the na­tion. “We wanted to see a dif­fer­ence made in our coun­try where no­body was com­ing to in­vest,” Pres­i­dent Paul Kagame told a sum­mit on in­vest­ment in Africa in March.

The RPF delved into its war chest from the 1990-1994 civil war, built up with con­tri­bu­tions from the Tutsi di­as­pora, to cre­ate the com­pany and jump-start the pri­vate sec­tor.

The pre­cise own­er­ship of the com­pany is not clear. On its web­site it says it chooses in­vest­ments to “make a sig­nif­i­cant im­pact on the so­cioe­co­nomic land­scape”. In 1998 Crys­tal Ven­tures part­nered with South African tele­coms gi­ant MTN to put in place a mo­bile network in Rwanda.

In 2015 the in­vest­ment com­pany sold its 20 per­cent stake in MTN Rwan­da­cell, but ob­servers re­main con­cerned about the stran­gle­hold Crys­tal Ven­tures has on the econ­omy and whether this could scare away pri­vate in­vestors. A west­ern diplo­mat, speak­ing on con­di­tion of anonymity, said the econ­omy was “dom­i­nated by the party (RPF) and in­ter­ests sur­round­ing the party.”

He re­ferred to another con­glom­er­ate at­tached to the de­fense min­istry: Hori­zon. One of its branches is the coun­try’s lead­ing con­struc­tion com­pany, build­ing roads and fo­cus­ing on in­fra­struc­ture de­vel­op­ment.

As Rwanda tries to draw in for­eign in­vestors “we are not sure that the pri­vate sec­tor is as free and trans­par­ent as it should be,” he told AFP, adding that in some sec­tors, such as dairy which is dom­i­nated by Crys­tal Ven­tures, there is no place for com­pe­ti­tion. Kagame in­sists there is no fa­vor­able treat­ment in award­ing ten­ders. “I would chal­lenge any­body to bring any fact ... there has been good com­pe­ti­tion,” he said. —AFP

KIGALI: In this pho­to­graph taken on July 28, 2017, a Rwan­dan po­lice­man walks past the dome of the Kigali Con­ven­tion cen­tre as it glows with the col­ors of the Rwan­dan flag in Kigali. —AFP

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