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EAC

GROWSRegional bloc opens the doorfor Rwanda and Burundi

April-June, 2007 http://www.kenyarwandabiz.org Edition 01

GOING WILDTourists ock in despite

travel advisories -Pg 20

ECONOMYChina woos Africa-Pg 30

SCIENCERwanda shows the way

to boost funding - Pg 28

NVESTORS BET ON RWANDA - Pg 12


2/40


3/40

CONGRATULATORYMESSAGE

Ernst & Young congratulates the Kenya-Rwanda Business Association

KRBA) on the o cial launch of its East Africa Business Focus Magazine

e are proud to be associated with KRBA in promoting investment in

East and Central Africa.

The Ernst & Young ofces ment oned above are all members of Ernst & Young Global.

en a an a wan a anzan a

Kenya-ReTowers Upperhil Ernst & Young House Rugigana House Ernst & Young

agat oad 1 ement oad venue de a a x u d ng, oors

ox 44 Shimoni Ofce Village ox Azikiwe Street

00100 Nairobi, G.P.O P O Box 7215 Kigali, Rwanda P O Box 2475

Tel: +254-20-2715300 Kampala, Uganda el: +250-572634 Dar es Salaam, Tanzania

Fax: +254-20-2716271 el: +256-41-343524 +250-572528 Tel: +255-022-2667368

o :+ 4- - ax: + -41- 1 ax: + ax: + - - 4

Mob: +256-752760082 Mob: +254735994400 Mob: +255-0784780334

www.ey.com


4/40

East Africa Business Focus April - June, 2007

Contents

enyas Export

Promotion Council forms

crucial link between

exporters in Kenya and

he available business

opportunities

17 Exporting ideas

Kenya Rwanda Business

Association opens new chapter

The land-locked nation is a virgin territory with high potential for growth

Investors bet on Rwanda

Since Narc took over power

in 2002, it has embarked on

o c es t at ocus on econom c

eve opment, u ng an

rehabilitating infrastructure and

creating employment.

resi ent u iantao

30 China woos Africa

6 Cover StoryPartnering for the future

9 FeatureRwandese delight

10 Agriculture

Mumias stirs sugarmarket

Investment

36 Taking Stocks

14 ConstructionKenyas changing skyline

16 ManagementTips on building a successful team

Trade

23 Trade ties that bind

30 China woos Africa

20 TourismGoing Wild

26 CharityGiving a home and a

future

28 Science & TechnologyTime for experiments

32 TaxKRA tightens noose on tax

cheats

34 CounterfeitAll that gliters ...

38 Life SkillsSix Business Blunders

25

12


5/40

April - June, 2007 ast Africa Business Focus

Editorial

s er

nya-Rwanda Business Association

itor

rence Mukiebe

nsu t ng tor

p en rma

vise Editor

er Sibomana

ntr utors

ques amaz , on o ur a, ranco s a asrceline Nyambala and Kimani Chege andwton utuma

o uct on ss stante a t

e- ress erv ces

vid Mwangi

otos

S Kenya, Douglas Otieno

vert s ng a es

orkomm Media Servicesntact person: Clifford Nturibi. ox -ro , enya

: +254 20 2733209 / 2734484ail: ideas@inforkommmedia.com

tr ut on

nya

ian MuliRBA Kenya Ofce

. ox -irobi, Kenya: +254 20 607154

wan a

wan a ce. Box 6627

gali, Rwanda: +250 08302001

t Africa Business Focusis published quarterly by

or omm e a erv ceson behalf of the enya

an a us ness ssoc at on. Views expressed in

pu cat on are t ose o t e aut ors an o not

essar y re ect t e pos t on o t e pu s ers.

pyright 2007East Africa Business Focus.

rights reserved. Material may be reproduced if prior

ngement is sought and with acknowledgement of

t Africa Business Focusmagazine.

I

n Africa, the birth of a chil

the family in which it is bo

soc ety. s s t e oy we ee

Business Association (KRB

aunch the Kenya Chapter oft the same time unveil the ina

magazine,East Africa Business

The magazine, to be publi

times every year, will highlight

ect ng us nesses n t e re

w t a v ew to e p ng promot

best practices in business and

promote growth of trade in the

region.

A new-born child is easily

ntegrated into the society

n which it is born. It is our

ope t at usiness ocusn , w e accepte y t e us ness commun ty an pro ess ona s n t e

region. The magazine and the association present a forum for members and the larger

business community to learn from each other for the better management of their

respective businesses and overall growth of economies of our nations.

For us to realise growth in our businesses, there must be good governance, a

principle that has been a focus of our governments in the region, hence the visible

growth of our economies.

wou e to c a enge us nessmen to ta e a vantage o t e con uc ve

nvestment env ronment an exp ore t e var ous us ness opportun t es n t e reg on

to further expand our horizons.

I would also like to invite those who havent joined the Kenya Rwanda Business

Association to do so because as the saying goes, there is strength in numbers. We

need to form a strong team of business people that can lobby regional governments

on issues affecting business development, a function we hold dear.

For the members of the association, this has been a long journey ever since the idea

o a us ness c u was oate . rom recru t ng new mem ers to t e ga aunc o

t e wan a apter o n cto er ast year, mem ers ave put so muc e ort

to make this association a success.

And their efforts are bearing fruits. From the point at which KRBA was just an

dea, the association has grown to a level where there are members from various

professions and businesses represented either as individual or corporate entities.

What remains for these members is to actively be involved in various activities that

the association hopes to engage in, including workshops, training and interactions

w t ot er us ness assoc at ons n or er to mprove our ways o o ng us ness.

s an assoc at on, we prom se to prov e t me y an accurate n ormat on geare

towards promoting ideal business opportunities in the best interests of our members.

And in what other better forum than through our magazine!Let us all support this initiative and let us know your views by writing to us.

Explore!

Chairman KRBA

Expanding New Horizons


6/40


By EABF Correspondent

When Rwanda and Burundi joined

the East African Community last

November, the region crossed

a major milestone. The move

now expanded the community

to ve nations. This substantially increased

prospects of trade and opened more investment

opportunities for citizens in the region.

he inclusion of the two countries was

endorsed at the EAC heads of State summit

chaired by Kenyas President Mwai Kibak

wanda and Burundi, which neighbour eacother, had been seeking to join the bloc sinc

ts relaunch in 1999.

This decision opens a new chapter in ou

cooperation, Tanzanian President Jakay

ikwete told an EAC summit in Arusha.

congratulate Rwanda and Burundi for joinin

our family of EAC members.

It was President Kikwete who broke th

news to members during a plenary sessio

at the summit, which was also attended b

Partneringfor the

C

The expanded East

African Community

leaders move to tighten

ties to increase prospects

of trade and open

investment opportunities

for their citizens


7/40


he presidents of Rwanda, Burundi, Uganda

and the semi-autonomous Tanzanian island ofanzibar.

You have joined a vibrant community with

a lot of prospects, President Kibaki said at the

end of the one-day summit.

Size mattersor President Yoweri Museveni of Uganda,

he large size of the regional body matters a

ot. According to him, it will make its market

attractive to the world. A functional common

arket is currently emerging in the region

backed by agreements on tariffs across thecountries borders.

Rwandas President Paul Kagame expressed

his countrys readiness to play an active role in

he development of the regional economic and

political bloc.

Initially, EAC had only Kenya, Uganda and

anzania as members. Over the last one year,

he three countries have been campaigning to

ransform the region into a political federation.

he community agreed on a customs union last

year and plans to launch a common market for

ts population of about 90 million by 2010.hey also plan to have a monetary union by

009 and a common president and parliament

by 2010. At present, its most active institutions

are its secretariat and customs union, but it also

has a regional court and Parliament.

Divergent viewshe rst attempt at East African Cooperation

ended in 1977 because of the three partners

idely divergent political and economic

From Left to Right:

President Amani Karume of Zanzibar,

President Paul Kagame of Rwanda, Ugandan

President Yoweri Museveni,

Kenyan President Mwai Kibaki,

Tanzanian President Jakaya Kikwete and

President Pierre Nkurunziza of Burundi in a

past EAC summit in

Arusha, Tanzania

ory

future


8/40


hinking. The predecessor of the current

economic bloc was formed soon afterndependence from Britain in the early 1960s.

Leaders of the three countries agreed that the

egion would be stronger operating as a single

economic unit and ultimately a political

ederation.

The three founder member states of the re-

aunched bloc had earlier said that Burundi

ould not qualify for membership unless it

eld democratic elections and tackled the

nsecurity that had plagued it during a civil war

hat killed 300,000 people.

Rwanda and Burundi had applied to join

he economic community to boost regional

rade. Their applications had not been acted

on for several years as the original members

orked to get the ve-year-old organisation

on its feet and set up a customs union that sets

common duty rates for imported goods among

he countries.

Things have since changed for the better.

Had Rwanda and Burundi not maintained

peace and stability, Kenya, Uganda and

anzania would have automatically turned

down their application to join the bloc. But

hen they were admitted to the fold, the two

countries became the rst French speakingEAC members, making the bloc bilingual.

Donors now support the government of

Burundian President Pierre Nkurunziza, who

as elected in 2005. The new administration

has been trying to boost the countrys fragile

economy after 12 years of conict.

Rwanda, too has been struggling to rebuild

its economy which was shattered after the 1994

genocide in which 800,000 people were killed

in three months.

The small landlocked country in the Central

Africa borders Uganda in the north, Burundi

in the south, Tanzania in the East, and the

Democratic Republic of Congo in the west. It

is the most densely populated country in Africa

ith a population of eight million people and a

total area of 26,338 square miles. More than 90

per cent of the population lives in rural areas.

More womenThe country has more women than men. Women

account for 54.3 per cent of the population,

ith 34 per cent of them heading homes and 92

per cent involved in subsistence farming.

wanda is a land of great diversity an

beauty. Popularly known as the land of thousand hills, it has six volcanoes, 23 lake

and numerous rivers, some forming the sourc

of the great River Nile.

BeautyLandscapes in this green country ar

breathtaking. Many a visitor to Rwand

has remarked that the physical beauty o

the country is without equal on the Africa

continent. Spectacular volcanoes and dens

tropical forests dominate the north of th

country, while gentle hills and valleys, calm

lakes and turbulent rivers dominate the rest o

the country.

urundi on the other hand, occupies a hig

plateau divided by several deep valleys. It

rich in natural resources that include a variet

of minerals. However, the society is large

agricultural. Besides the EAC, Burundi, Keny

Rwanda, and Uganda are members of th

Community of East and Southern African Stat

(Comesa). Formed in 1994, the Comesa blo

has 20 members but Tanzania withdrew in 200

citing trade imbalances with member states.n

Over 18 million consumers join East African Community as Rwanda and Burundi are admitted

Regionalmarket expands

Cover Story


9/40


Rwanda is fondly

referred to as the land

of a thousand hills

t an s to ts eaut u

mounta ns an t e

world-famous mountain gorillas

that attract thousands of tourists

into the country every year.

Mine was not a tourist expedition

but it turned out to be.

As a delegate from Kenya to

w tness t e aunc o t e enyawan a us ness ssoc at on,

Rwanda Chapter, I was

overwhelmed by the hospitality

of the Rwandese. I must say I

was a bit apprehensive before the

safari because the only stories I

had heard or read about this tiny

r can country was t e

genoc e an won ere w at

to expect upon arrival. To my

surprise, the people of Rwanda

turned out to be so welcoming

to visitors.

No sooner had we disembarked

from the Rwandair Express ight

t an we were su en y azz e y

t e eauty o t e y an . n

as it turned out, the hospitality

we had experienced on board

the ight to Kigali was not just a

professional courtesy. It reected

the warmth and friendliness of

the Rwandese.

ec ng n was sw t an

efcient. We were promptly

informed that we would not need

to buy local network sim cards,since our hosts, KRBA-Rwanda

Chapter, had some ready for

us at the hotel. What a pleasant

surpr se

ur rooms at t e ote es

Mille Collines were beautiful

and clean. But this was not just

another hotel. It was the Hotel

Des Mille Collines which starred

Rwandese delightCathy Kamauwas a delegate to the KRBA launch but ended up as a part-time tourist.

Here is her take on life in Kigali

recently in a box ofce hit movie,

Hotel Rwanda.

Soon after settling in, our hosts

were threatening us with a hectic

agen a o un- e act v t es

start ng w t a coc ta oste y

the Kenyan ambassador to Rwanda,

Amb. Alex Keter, and his gracious

wife.

The ambassador and his wife

made us all feel quite at home, with

some Kenyan business people with

us nesses n ga a so present

at t e party. etween moments

of bonding and laughter, we were

introduced to various Rwandesebusiness people.

ater that evening, we ended up

at a nyama choma joint eating

Kenyas favourite dish with an

assortment o con ments. t sure y

e t e ome. en o to s eep we

went, preparing for Day Two.

Two winks and it was sunrise!

Time for breakfast and the

business presentations. The

presenters knew their stuff and

took us through the paces painlessly

before we took off for a round of

go n t e a ternoon. e o ers

an non-go ers too qu c y got

into their vans and off we went to

yarutarama.

The golfers could hardly wait

to tee off with their Rwanda

counterparts. As for the non-golfers,

we had all the time in the world.

e sat an ate ms a s s ewere

meat an got to now eac ot er.

Before we could say the 19th

hole, it was evening and time togo back to our hotel to spruce up for

the KRBA launch dinner. We were

shown to our respective tables, and

conversation was soon humming

roun t e a room. s was t e

us ness t at roug t us to wan a

in the rst place, but there was much

more besides. But that is a story for

nother day. n

Checking in

was swift and

efcient. We

were promptly

informed that we

would not need to

buy local network

sim cards, since

our hosts, KRBA-

Rwanda Chapter,

had some ready

for us at the

hotel. What a

pleasant surprise!

Feature


10/40

T

he year was 1967 and the

Government of Kenya was exploring

the possibility of growing cane in

Mumias area ruled by a king before

t e co on a era.o ac eve ts goa , t comm ss one

Booker Agriculture and Technical Services

now Booker Tate) to carry out a feasibility

study.

At the time, the area was underdeveloped.

Land was not being put to good use as

farmers grew food crops on small portions

w e t e rest o t e r an was e.

e re at ve remoteness o t e area an

poor communication network prevented

the growth of a vibrant market economy.

However, land in the area had been sub-

divided and farmers given freehold titledeeds, which favoured the proposed

sugarcane project.

ter oo er experts comp ete t e r

stu es, t ey a one ver ct: e propose

project could take off.

According to them, it was possible to set

up a viable sugar scheme. The factory would

be supplied with cane from its nucleus estate

and the outgrower farmers from nearby

areas.

The Government accepted these ndings

an on u y , , t e um as ugarompany was ncorporate . e overnment

was to hold majority shares (71 per cent)

while the Commonwealth Development

Corporation had 17 per cent. The Kenya

Commercial Finance Company had a ve per

cent stake while Booker McConnell had four

per cent and the East African Development

an t ree per cent.

ome o t e ey o ect ves o sett ng up

the company were to provide income for

farmers and create job opportunities since

there was no major industrial undertaking

in the area at the time. This was expectedto prevent rural-urban migration, reduce

overdependence on importation and aim

or se -su c ency n sugar pro uct on. e

company was a so expecte to operate on a

commercial basis and make prots.

The rst bag

The original factory had a milling capacity

of 80 tons of cane per hour (tch), which

translated to 45,000 tons of sugar per year.

e rst ag o sugar ro e rom t e

conveyor ne on u y , , ust a year

after the factory was built.

The factory had a provision for expandingits crushing capacity to 75,000 tons of sugar

per year.

It was originally intended to implement

this expansion during the 1978/79 nancial

year ut ow ng to ts goo per ormance, t e

Government brought forward the programme

to 1975/76. Milling at 125 tch rate began in

July, 1976.

Improved performance encouraged the

Mumias stirs sugarmarketLeading miller has come a long way. Besides trying

its hand in energy production, it is also seeking to

become king of the sweetening industry. But how

did it all start? Njonjo Kihuriatraces the roots of the

rms success

Government to consider further expansio

to etween tc an tc . o ow na ec s on to expan to tc , t ere wa

need to build a new factory to meet the new

demand.

In August, 1976 contracts for the suppl

of equipment and construction of the factor

were signed and government approv

obtained during the 1979/80 nancial year.

or on t e new actory was comp ete

n ear y g v ng um as a potent

capacity of 210,000 tons of sugar per year.

The construction was nanced mainly b

loans from the Commonwealth Developmen

Corporation amounting to 3.25 milliosterling pounds and a further 19,720,00

million sterling pounds from the Nation

estm nster an .

The new factory design capacity wa

reached and surpassed for the rst time i

1986/87. From then on, production stabilise

at between 210,000 and 220,000 tons of can

per year.

roduction increased every year save fo

a r e nterrupt on n w en ow can

The relative remoteness

of the area and poor

communication network

prevented the growth of avibrant market economy.

However, land in the area

had been sub-divided and

farmers given freehold title

deeds, which favoured the

proposed sugarcane project

Agriculture

Mumias Sugar MD, Evans Kidero



11/40

ields affected supply until 1986/87 when

he situation improved. During the rst

ear of sugar production in 1973, Mumias

produced 20,891 tons from 194,217 tons of

ill cane.

In 1993, the Government signed the

COMESA Treaty, which allowed free trade

mong mem er countr es, an t s opene a

oodgate for imported sugar affecting local

sales, which then were being carried out by

he Kenya National Trading Corporation.

The move immediately sent the

government to the drawing board and it came

up with a privatisation programme that saw

um as ugar so to t e pu c n .

urrent y, t e company s ste on

he Nairobi Stock Exchange (NSE). In

ecember 2006, it stirred up the stock

arket when it sold more shares to the public

hrough a second share offering. The sharesere gobbled up but the prices have been

declining from about Sh50 at the time to

n e ruary an arc , .

ur ng t e nanc a year,

umias Sugar posted an after-tax prot of

Sh1.52 billion compared to the previous year

hen it posted Sh1.28 billion. This reected

n increase of 18.3 per cent over the previous

ear.

Closer to customers

e company s supp e w t cane rom

ts nucleus estate and local farmers whoave contracts with the company under the

umias Outgrowers Company (MOCO).

The company provides contracted farmers

ith inputs on loan, supervision and

extension services.

um as ugar a so accepts raw cane rom

armers. o ensure t at t e cane s o t e

ighest quality, the company recruits farmers,

supplies inputs and services on loan, for

nstance ploughing, harrowing, furrowing,

provision of seed cane and fertiliser.

It also provides supervision and extension

services, besides harvesting and transporting

e cane once t matures. o e ucate cane

farmers, the company organises educational

programmes, public meetings, seminars,

eld days, farmers education days and

eld demonstrations in collaboration with

elevant government ministries and other

elevant service providers such as the

enya Sugar Research Foundation, the

n stry o gr cu ture an t e rov nc a

dministration.

Brown sugar

um as ugar prov es per cent o

enyas sugar through appointed distributors

countrywide. The company also exports

some of its sugar to international markets

ainly in the European Union. Last year, it

exported 20,000 metric tons of brown sugar.

Mumias aims to live on as the market

ea er. s s a r ve t at can on y e

chieved by giving its customers what they

want the way they want it. The rm has

lso introduced brown and white sugar tocarter for emerging preferences among tea

consumers in the region.

The sugar is sold in varying quantities

o t the pockets of both the rich and the

poor. es es sugar pro uct on, um as

has ventured into other avenues including

generation of energy. It is investing 35

illion in the project.

Once completed, Mumias will have

he capacity to produce 35 megawatts of

electricity, of which 20 megawatts will

be sold to the Kenya Power and Lighting

ompany.

Other areas under consideration include

power alcohol through production of ethanol

from sugarcane for the motor industry.

Besides, it has a bursary scheme through

which the 20 top KCPE candidates 10

of whom must be children of company

emp oyees an ten o armers contracte

to t e company are awar e our-year

bursaries to study in secondary schools.Mumias is also involved in environmental

conservation. Last year, it distributed six

million seedlings to cane farmers, women

nd youth groups, schools and other public

nstitutions.

e company s p ot ng t e zo a ver

as n anagement n t at ve a me at

conserving Nzoia River, which is the lifeline

of the area residents - from Cherengani Hills

to Budalangi in Busia District.n

Agriculture

pril - June, 2007 East Africa Business Focus


12/40


By Florence Mukiebe

The World Banks revelation that it is

easier and faster to start a business

n wan a t an n ne g our ng

countr es m g t ave attracte t e

attention of hawk-eyed Kenyan

nvestors. Many of them travelled to Kigali

to witness the grand launch of the Rwanda

chapter of the Kenya-Rwanda Business

Association (KRBA) last October.

But why did Rwanda receive this verdict

rom t e or an

nce t e en genoc e, t e an -

ocked nation has been attracting goodwill

from the international community and has

much going for it. According to World

Bank ratings, the country tops the region on

good governance and has the lowest level

of corruption. It has a strong leadership

committed to encouraging the businesses to

thrive. It also gives various incentives to lure

investors. These include free residence and

work permits and duty free importation of

raw materials and machinery among others.

ere are ot er econom c m estones suc

as g econom c growt - w t an average

rate of six per cent; single digit ination

and a stable currency operating in a free

exchange rate regime. All these are bound to

attract investors.

Investment opportunities are to be found

in exports, large-scale farming, industrial

process ng, u ng o green ouses an co

storage ac t es, pro uct on o pac ag ng

materials and farm inputs such as fertilisers

and pesticides.

According to Clare Akamanzi, the

deputy director of Investment at the Rwand

Investment Promotion Authority (RIEPA

almost all sectors of the economy hav

been growing steadily over the last v

years. Fruit and vegetable production ha

increased tremendously, creating potenti

or export. s s a goo s gn cons er n

t at agr cu ture comman s per cent o t

countrys GDP, with the main exports bein

tea and coffee.

Addressing KRBA members at th

Rwanda Chapter launch, Ms Akamanzi als

stressed her governments commitment t

develop its information communicatio

tec no ogy . owever, access to t

nternet an ot er e s o commun cat o

is still low. But for investors, this is

ripe opportunity as they are encourage

to tap into this fairly underdeveloped bu

Investors bet on RwandaThe land-locked nation is a virgin territory with high potential for growth,

says investment chief

Investment


13/40

April - June, 2007 East Africa Business Focus

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ext to aya entre renc c oo rgwngs o e oaP.O. Box 8342-00100Nairobi, Kenya TEL: +254 20 3864364 / 3877144 / 3878173

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the 1994 genocide. Because this perceptionof the civil war is still strong, the goodn the Rwandese people and the suitable

environment for investment offered by thecountry can easily go unnoticed. However,the country has made signicant progress

n re u ng ts economy an soc a

n rastructure.Organisations like RIEPA were set up to

speed up Rwandas economic growth. Thegency is the agship of Rwandas investment

nd export promotion programmes and a keycog in the economic development wheel.

Apart from facilitating the approval and

icensing of new investment projects andanag ng t e ncent ves g ven to nvestors,

a so n t ates nvestment promot on

ctivities and seminars to sensitise thenternational business community on the

opportunities available in Rwanda.

According to RIEPAs Director General,illiam Nkurunziza, Rwandas uniqueness

nd attractiveness lies in the fact that it

s a v rg n economy, untappe an u o

potent a .For the discerning investor, Rwanda

epresents the virgin territoryeverysector from agriculture to Information

Communication Technology, from tourismto manufacturing, from mining to nancialservices abounds with opportunity because

little has happened in all of them, saysurunz za.n ee , n areas e t e nanc a sector,

only seven per cent of the eight millionRwandese have opened bank accounts.Firms in the insurance industry also lack

the capacity to cover large projects. Thisleaves a large segment of the populationand businesses unattended and the market

unexp o te . ut w t t e attract ve

nvestment ncent ves an t e grow ngspirit of the regional cooperation, perhapsinvestors should consider casting their netswider as Rwanda beckons. n

Rwandas untapped resourses

Investment


14/40


y ewton utuma

enya is on its way to becoming a

concrete jungle, thanks to the boom

n t e construct on n ustry.

ne ar y passes t roug any

own or shopping centre without

noticing commercial and residential

buildings going up as though reaching for

the sun.

Economic experts had predicted a growth

rate of 5.2 per cent in this nancial year but

his can even be higher considering the high

ate of the upcoming constructions in the

ousing sector and the huge allocations in

he roads sector, says Victor Musumba, an

economist in Nairobi.

However, a surprise increase in the cost of

construct on mater a s towar s t e en o ast

ear caused jitters within the industry.

Kenyas construction industry offers great

prospect particularly for manufacturers of

building material and low-cost building

ethods.

It is also good news for cemen

manufacturers and suppliers since th

demand for the primary product i

construction has gone up.

eal estate agents in Nairobi say that mo

entrepreneurs are cashing in on the boom

more t an ever e ore.

Ready marketWe have been doing well especially from

2004 and getting better. I believe there

more to come our way since there is a read

Growing economy sparks construction boom across the country

Kenyas changingskyline

Construction


15/40


arket either for purchase of houses or

entals, says Barnabas Njaga, a real

estate developer in Nairobi.

And Erastus Mbakigane adds: This

growt s an n cat on o t e econom c

oom e ng exper ence n t e reg on.

bakigane is a Ugandan civil engineer

orking for a major construction

company in Upper Hill, Nairobi.

Records from the Central Bureau

of Statistics (CBS) indicate that the

ndustry experienced tremendous

growt n , w t cement

consumpt on r s ng rom . m ononnes in the previous year to 1.6

illion tonnes, representing an increase

of 10.9 per cent.

Consumption in June 2006 rose by a

further 8.1 per cent to 654,565 metric

onnes from 605,571 metric tones over

e same per o n .

ere as a so een an ncrease

budgetary allocation to the road sub-

sector and tax incentives contained in

he 2006/2007 Budget. The incentives

nclude making cost of constructing selected

buildings income tax deductable andndustrial building allowance of 10 per cent

or e ucat ona u ngs.

remar a e econom c upsurge as een

ecorded on the continent and particularly in

astern Africa.

In Rwanda, building and construction

pundits say growth has been spurred by an

urge to rebuild the country that is recovering

from a genocide that claimed almost a million

peop e rom ts popu at on an roug t t e

economy to a complete standstill.

Rwandas real estate sub-sector is

skyrocketing with many investors ockingnto the country especially from the East

frican region, says an ofcial at the

enyan Embassy in Kigali, Rwanda.

Another market opened up is the Southern

u an a ter t e s gn ng o t e peace accor

between the South and the Khartoum

government. The Comprehensive Peace

greement restored peace in the oil rich

egion, paving the way for construction

ctivities that are now in full gear. A

spot check at the major towns of Juba

n um e areas revea s a g rate oconstruct on espec a y n t e ous ng an

roads sub-sectors.

Most of the roads, which were either non-

existent or dilapidated are being nanced by

donors such as the European Union and their

completion is underway. Companies working

on these projects are mainly from Kenya and

gan a.

However, the cost of housing is still high

since most rental establishments are privately

owned. Currently, accommodation in

Southern Sudan is a nightmare. Visitors in the

now relatively calm region are either forced

to pay dearly for the few existing lodgings or

have to hire tents, which cost up to 150 per

n g t, exc u ng mea s.

Renewed growthThe renewed growth of Kenyan cement

factories attest to growing regional

construction industry. One such beneciary

s East Africa Portland Cement which has

exper ence a turn-aroun rom a oss-

making state corporation to a prot-making

enterpr se.ter arc too over government, ts

leaders vowed to revamp moribund state

corporations or to close them down altogether

if they failed to perform efciently. One

beneciary of revival was East Africa

Portland Cement.

The rm attest to how State corporations

can e va ua e c anne s o spurr ng

growth as it managed to trade in the gown

of mismanagement for one of efciency,

excellence and achievement.

Portlands growth has been spurred by the

opening up of new markets in the region. It

was among the rst cement manufacturer to

p tc camp n out ern u an, compet ng or

t e mar et s are w t ot ers rom gypt an

Uganda.

The company has established a warehouse

in Juba and Rumbek, which has contributed to

a fast and effective supply of the commodity.

It is now seeking to venture into new markets

in the region such as Yei, another upcoming

ma or town.n

Construction boom

Construction


16/40

6 East Africa Business Focus April - June, 2007

Management

For tailor-made insurance products please contact us either at the Head Ofce,Madison Insurance House, Upper Hill Road P.O.Box 47382 - 00100 Nairobi

Telephone: 2721970/1, 2864000 Fax: 2723344Email: enquiries@madison.co.ke

Website: www.madison.co.ke

or any of our fourteen branches countrywide.Nairobi: Moi Avenue, Industrial Area, City Square, Westlands

Mombasa, Kisumu, Nyeri, Nakuru, Eldoret, Kisii, Kakamega, Meru, Thika, Machakos

Tips on building a successful team

Many peop e won er ow us ness

powerhouses like that of Donald

Trump or Warren Buffet havemade it. The fact is they just do

what you dont. One of the important skills

for leaders to master is the ability to recruit

high-potential talent into the organization.

ecru t ng s ou n t e react ve

per orme on y w en you ave an open ng

on your team. t s ou e an ongo ng

ctivity so that your pipeline of candidates

s full and you can start interviewing shortlyfter a need has been established. Follow

these tips to make the most of your efforts:

l Look to your existing employees for a

promotional opportunity, rst. You should

ways oo w t n t e organ zat on e ore

you cons er externa can ates. ewar

emp oyees w o are act ve y eve op n

their skills and are loyal to the company.

there someone who is ready to take on neresponsibilities?

l If you are an active member of you

professional community, start buildin

a rapport with prospective candidate

ecru t ng s a ot e mar et ng t e mor

pos t ve contact you ave w t prospects, t

more receptive they will be to talking to yo

about making a move to your organizatio

Keep in contact with those you would like t

have on your team one day.

l Build a reputation as a strong leade

This is one of those times when you wan

your reputat on to prece e you. you a

nown or e ng a great ea er, can ate

will want to work for you. Year after yea

lack of opportunity is cited as one o

the main reasons for employee turnove

Judicious candidates know that their manage

can make or break that opportunity and the

make their decisions accordingly.

l on t e nt m ate y ynam c, g

potential candidates. Instead of worryin

about someone taking over your job, thin

about who could potentially replace yo

when you move on to a bigger role.

l Avoid the temptation of hiring someon

just like you. It is great when you hava connect on w t a can ate, ut try t

remem er t at you aren t r ng someon

to be your friend. Instead, look for someon

who will complement your teams strength

and weaknesses.

l Select candidates who are passiona

about their work. Passion is difcult t

ascertain during an interview. Howeve

t ere are s gns you can oo or an quest on

you can as to etter eterm ne t s

someone who is passionate about their wor

Stop settling for mediocrity. Dont b

afraid to hold off on making a selectiodecision until you have the right candidat

Get creative in the way you manage you

employee shortage. Consider redistributin

t e ut es on your team an r ng

temporary a m n strat ve emp oyee to ta

up the slack. This is a great time for you

employees to gain additional experience. n

Adapted from Jill Franks book, To

7 Skills of Building a Successful Busines

Team


17/40


enya s essent a y an agr cu tura

economy mainly driven by horticulture

and cash crops such as coffee and tea.

However, tourism also plays a key role

n the economy and is increasingly becomingkey income earner.

Since Narc took over power in 2002, it has

em ar e on po c es t at ocus on econom c

eve opment, u ng an re a tat ng

nfrastructure and creating employment.

But even before this, the ongoing

iberalisation of the economy that was

nitiated over 10 years ago by Kanu has laid

the groundwork for an investment-friendly

environment in Kenya.

e government as a so ta en var ous

steps to create ena ng env ronment to

encourage both foreign and domesticnvestment in line with the economic

recovery s ra egy programme.

The economic recovery strategy hopes

to achieve an eight per cent growth rate

nnually and help Kenya become a newly

n ustr a se country y . s s a

ong-term vision for the economy and the

success will depend on how the current

dministration of the day handles the process.

enya is an important player in East Africa.

Council forms crucial link between

exporters in Kenya and the available

business opportunities

Exporting

ideas

The country is strategically placed with

major port, Mombasa, where goods for

the region land en route to their respective

countries, including landlocked Rwanda,

Uganda and Burundi. Kenya also has well

eve ope nanc a mar ets, ma ng t a

hub for various services including transport

banking and health.

Export promotionOne of the agencies helping the government

to speed up economic growth is the Export

romot on ounc , a prem er

nst tut on n t e eve opment an promot on

of export trade.

Established in 1992, EPCs primary

objective was to address bottlenecks that

were facing exporters and producers of

export goods and services with a view to

increasing the performance of the export

sector. The council was set up to give an

outward orientation to an economy that was

hitherto inward looking. Over time, the EPC

as em race t e man ate o co-or nat ng

and harmonising export development

and promotion activities in the countryand providing leadership to all national

export programmes. Today, the council

is the focal point for export development

and promotion activities in the country.

o ensure max mum mpact, t as structure

ts operat ons to ocus on var ous sectors o

the economy. Six priority sectors, out of the

14 prioritised in the National Export Strategy

(NES), have been identied for focus under

this approach. They include horticulture

Trade


18/40


nd other agricultural products, textiles and

clothing, commercial crafts and SMEs, sh

nd livestock products, and services other

t an tour sm.

ac sector as a c amp on es gnateto drive agendas affecting the sectors in

terms of product and market development,

trade information needs; capacity

enhancement and policy environment.

The councils objective is to identify export

market opportunities for Kenyan products

n to ormu ate appropr ate mar et entry

n penetrat on strateg es.

The strategies used include contact

promotion programmes, market research and

nvestigations, trade fairs and exhibitions,

buyer-seller meetings, trade missions among

others.

The main objective of producteve opment s to ac tate t e expans on

n vers cat on o enya s export

product range. This is achieved by assisting

producers/exporters develop and adapt their

products to suit specic market requirements

through quality improvement, value added

processing, improved packaging and

presentation, new product design and styling,

ent cat on o new exporta e pro ucts an

dherence to industry codes of practice.

The Council recognises that relevant,

timely and current trade and market

n ormat on s cr t ca to t e compet t veness

o export ng rms. o a ress t s ent eneed, Centre for Business Information in

Kenya (CBIK) was established with support

from the government and the European

Union.

This centre contains current and relevant

nformation from credible sources, some

o w c nc u e t e , or ra e

rgan sat on , tra e promot on

organisations such as the Japan External

Trade Organisation (JETRO), Centre for

he Promotion of Imports from Developin

Countries (CBI), among others.

Information is accessible through prin

n e ectron c mo es. n a t on,

as a rary re erence centre ,w c freely accessible to all. The Council look

t trade policy facilitation in relation to th

growth and development of the export secto

This includes facilitation of the review o

domestic and external trade policies in orde

o enhance the competitiveness of Kenya

export pro ucts.

e ounc eve ops s s an mpar

nowledge on relevant topics to the exportin

fraternity through seminars and workshop

n collaboration with development partner

such as JETRO, JICA, ITC, CBI and EU

Under this pillar frequent promotion o

public awareness of the need for an expocu ture s ssem nate t roug pr nt an

e ectron c me a, export news an re ate

fora.

The EPC provides the right connectio

between exporters, importers and th

vailable opportunities in the expandin

economy.n

Additional materials from EPC websit

ttp: www.epc enya.org

Trade

The strategies usedinclude contact

promotion programmes,

market research and

investigations, trade fairs

and exhibitions, buyer-

seller meetings, trade

missions among others

Horticultural products are a major export commodity in Kenya

Exporting

ideas


19/40


Advertorial

Advertise

in the NextIssue of

and get ahuge

discount

u s er

enya-Rwanda Business Association

vert s ng a es

n or omm e a erv cesContact person: Clifford Nturibi G.O. Box 16352-00100

Nairobi, Kenyae : +mail: ideas@inforkommmedia.com


20/40


y orence u e e

Arica has been experiencing

a tourism boom in recent

years despite travel warnings

issued by the US. With 842

million arrivals, 2006 exceeded

expectations as the tourism sector

continued to enjoy above average

results, making it a new record

year for the industry.

he latest Wor Tourism

Barometer gures show that

2007 will consolidate the positive

performance and turn into the

fourth year of sustained growth.Despite risks facing global tourism 12

months ago in particular terrorism, health

scares due to avian u and rising oil prices

2006 was another year of good growth

a ove t e ong-term orecast rate o .

per cent, ac e up y one o t e ongest

periods of sustained economic expansion,

says UNWTO Secretary General Francesco

Frangialli.

ne o t e eatures o was t e

cont nue pos t ve resu ts o emerg ng

destinations, underscoring the links to

economic progress. As one of the most

dynamic sectors, Tourism plays a key role

in the ght against poverty and promoting

sustainable development.

By integrating sustainable tourism in

t e nternat ona eve opment agen a, our

sector can ma e a s gn cant contr ut on

o a vance t e enn um eve opmen

oa s t roug a more mo erate, so an

responsible type of growth, says Frangiall

Three years ago, world tourism bega

historically new phase of growth, as

broke the barrier of 800 million internation

rrivals, growing more than 20 per cent sinc

hen. We are now responsible for making thi

new p ase o growt more econom ca n t

use o energy an natura resources.

Tourists ock in despite travel

advisories from the US

Tourism

Going Wild


21/40


Major destinationsAfrica has outpaced all other regions with

lmost twice the rate of global growth

reaching 8.1 per cent in 2006, following an

lready strong 2005. This star performance

was led by Sub-Saharan Africa +9.4 per

cent , w e ort r ca + . p er cent a so

en e t e year a ove average.

Major destinations such as South Africa,

Kenya and Morocco all continued to post

excellent results.

gures re ease n anuary y t e enya

our sm oar n cate t at tour sm

was the countrys leading foreign exchange

earner with gures running to Sh56.2 billion,

after 1.8 million tourists visited Kenya last

year alone. This reected a growth of 15

per cent from the Sh48.9 billion the sector

earned in 2005.

we manage , tour sm cou e p to

reduce poverty because the high numbers

o arr va w create more o s an more

ac t es to cater or t e tour sts. s a so

calls for improvement of the infrastructure

and additional bed capacity as these are some

of the challenges that hinder faster growth

of this sector. Currently, the number of

classied tourist beds stand at 39,321. With

the demand rising steadily, an additional

, e s are nee e .


22/40


TsunamiAsia and the Pacic (+7.6 per cent) region

maintained its extraordinary growth due to

the recovery of Thailand and the Maldives

from the impact of the December 2004

tsunam , as we as remar a e per ormances

rom emerg ng est nat ons n t e reg on.

International tourist arrivals in South Asiagrew by 10 per cent, boosted by India, the

destination responsible for half the arrivals to

the sub-region.

Europeperformed on target last year (+4

per cent). Germany took advantage of the

oot a or up , w e ta y a

strong come ac . pa n s so resu ts

lso contributed to the generally positive

ou come.

In the Middle East, international tourist

rrivals are estimated to have risen by four

per cent in 2006, after the bumper years of

2004 and 2005, and in spite of armed conict,part cu ar y t e srae - e anon an srae -

a est ne cr ses.

Although the two per cent growth in the

mer cas ooks disappointing, regional

results vary considerably. The rise in the

USA was not sufcient to compensate for the

weak development in Canada and Mexico.

On the other hand, the results from Central

+ . per cent an out mer ca + . per

some uncertainties remain on

the global economic front and

they could impact the tourism

forecasts. Rising interest rates

in some countries and regions

could diminish available

income. A weaker US dollarmight affect foreign travel

demand by Americans. On the

other hand, a stronger euro

could stimulate European

international travel

cent) show how Latin America is on track

to conso at ng t e pos t ve outcome o

recent years: Chile, Colombia, Guatemala,

Paraguay and Peru all grew at double-digit

ra es.

Anticipate shocksThe increase in international tourist arrivalss pro ecte to e aroun per cent, muc

n ne w t t e orecast ong-term annu

growt rate o . percent t roug

Growth is expected to be more solid a

businesses, consumers, governments an

international institutions such as the UNWT

are now better able to anticipate shocks an

to respond more effectively to crises.

Travellers are better informed and havecome more a ept at we g ng t e r opt on

an now nc u e secur ty actors as u

another consideration among others whe

choosing their destinations.

s a whole, the global economy

expected to maintain last years growth leve

Oil prices have been less volatile and do no

pose a major risk to economic stability a

t ey a year ago.

Nevertheless, some uncertainties rema

on the global economic front and they coul

impact the tourism forecasts. Rising intere

rates in some countries and regions coul

diminish available income. A weaker U

dollar might affect foreign travel deman

y mer cans. n t e ot er an , a strong

euro cou st mu ate uropean nternat on

travel.

gainst the good tourism results of th

past three years and given the still favourab

economic outlook, this positive trend look

likely to grow in 2007.n

Tourism


23/40


Trade

y orence u e e

In todays corporate world, no business

can stand on its own. Each must lean

on others to succeed. And that is where

networking comes in handy because in

the global village, no business can operate

e an s an . nee to networ to ac eve

aster an g er growt .

This was one of the reasons why the Kenya

wanda Business Association (KRBA) was

formed by a group of business people drawn

from Kenya and Rwanda but with business

nterests in the East African region.

A not-for-prot association, KRBA was

orme to e p promote nvestments n ast

nd Central Africa. The associations members

re experienced business people and high

prole corporations whose combined wealth

of experience will help boost the growth of

ndividual businesses.

According to KRBA chairman Philippe

Nsanzimana, the organization aims to promote

exce ence n us ness among pro ess ona s

n Kenya and Rwanda. It also takes a keen

nterest in law-making, policy formulation

nd economic and social matters to promotebasic commercial freedom and good corporate

governance. We came together as a group

o help each other excel in our respective

us nesses. any o our mem ers ave ga ne

ot rom our re at ons p e t er at persona

evel or at group level, says Nsanzimana. Our

ssociation operates like a club of businessmen

nd members are more than willing to help one

nother.

The launch of the KRBA-Kenya Chapter

follows the successful launch of a similar

ranc n wan a ast cto er. em ers

rom enya trave e to wan a to meet t e rcounterparts not only for the launch but also to

exchange ideas and contacts.

During the launch, the chairman said: I

ave no doubt and it is my wish that each

participant will go back home with one or

ore contacts that may lead to greater business

opportun t es.

e a m o s to g g t a ava a e

opportunities and package them in a way that

ttracts capital in form of joint ventures and/or

Businessmen from Rwanda and Kenya form a unique team to boost investment

opportunities across the borders

The launch of the KRBA-

Kenya Chapter followed

the successful launch of a

similar branch in Rwanda

last October. Members

from Kenya travelled to

Rwanda to meet theircounterparts not only

for the launch but also

to exchange ideas and

contacts

Trade ties that bind

same vision, we will be able to draw attention

of our own investors and those from outside to

our untapped resources, adds Nsanzimana.

ugene utagarama, a mem er o

says o t e assoc at on: o ne w en

members were preparing for the launch of

KRBA-Rwanda Chapter. At the time, I was

planning to set up a high end restaurant in

Kigali and was interested in networking.

The trip to Kigali opened an opportunityfor my business because I made good links

w t us nessmen n wan a an

mem ers ase n ga . ow t e mem ers

meet weekly in my restaurant, boosting my

business.

Eugenes story is no different from Joy

Muchinas, an events organiser based in

Nairobi. Joy joined the organisation late last

year but her business contacts have grown

s nce. oy s t e propr etor o ver n ng .


24/40


I have a lot of clients who are referred to me by

members who in turn introduce other clients, she

says. I strongly believe that KRBA will go a long

way in fostering lasting and mutually benecial

us ness re at ons ps etween us nesses ot n

enya an wan a. ur mem ers are so w ng

to help and thats how we are able to grow both

ndividually and as a team.

The opportunities that await those daring to venture

re many and varied. The economys uniqueness and

ttractiveness lies in the fact that Rwanda is a virgineconomy, untapped but full of potential.

ome o our mem ers ave nterests o expan ng

to wan a. e eauty s, our counterparts rom

Rwanda can also expand to Kenya and since Rwandese

get a lot of products from Kenya, it is now easier to

get trade contacts through our association, explains

Nsanzimana. He says some of the activities that the

ssociation hopes to engage in are hosting other

business associations for business talks, organising

wor s ops or us ness peop e an sen ng e egates

to international business fora.

We can only grow as a group if we are able t

nteract with other business people both locall

nd internationally the reason why we have line

up act v t es or t s purpose a t roug t e year.

wor as rea y ecome a g o a v age an we on

want to be left behind, he says.

And for Patrick Ndisanze things can only get bett

for his business. He was one of the rst people to jo

the association.

KRBA has given me the opportunity to knopeople from diverse industries and that has give

my us ness, ena.net erv ces, a prev ew o ot

e s, e says. t t e aunc o t e wan

Chapter, KRBA has opened a window of opportunit

n attracting business from across borders.

With the ofcial launch of the two chapter

members now hope to work closely with th

governments of both countries, national institution

nd individuals to further promote business growth i

enya an wan a.n

Trade ties that bind

With the launch

of the Rwanda

Chapter, KRBA has

opened a window

of opportunity in

attracting business

from across borders

Trade

KRBA chairman Philippe Nsanzimana (left), Paul Ouma and Clare Akamanzi deputy director RIEPA


25/40


y Ken Oduor

The venue was Kigali. And the event

o t e moment ast cto er was t e

aunch of the Kenya Rwanda Business

Association, Rwanda Chapter.

enyas Minister for Trade and Industry, Dr

ukhisa Kituyi, his Rwanda counterpart,

incent Karega and Kenyas Cooperative

evelopment Minister, Njeru Ndwiga,

ere among t e gn tar es present. ver

enyan nvestors w t us ness nterest n

he region also attended the launch.

We love our Rwandan brothers... Ourgovernment has given 150 Freshian dairy

cows to our friends here, Mr Ndwiga said

ith a light touch.

According to Paul Ouma, the chairman

o t e wan a c apter, t e aunc

o t e assoc at on was ta ng p ace at a t me

hen the global economic order is driven

by economic blocs such as the European

nion, the Southern Africa Development

Cooperation and the East African

Community.

Access to large and new market

opportun t es s ust one o t e ene ts were po se to ave, e to t e e egates.

Rwanda is a virgin land beckoning for

andsome investors. It offers opportunities

cross the board. For instance, the country

runs a substancial trade decit because she

imports almost everything. This means that

there is lack of import substitution, which is

where the investors can come in, especially

n t e pro uct on o consumer goo s .

Other dignitaries who attended the launch

were Rwandan Minister for Public Services,

Skills, Development and Vocational Training,Prof. Manasseh Nshuti, Kenyas ambassador

to Rwanda, Amb. Alex Keter, Rwandas

ambassador to Kenya, George W. Kayonga,

a rman o enya apter

Philippe Nsanzimana, RIEPA DirectorGeneral, William Nkurunziza, Chairman of

the Rwanda Private Sector, Robert Baigamba

an ecretary enera o , mmanue

atege a.n

KRBA chairman Philippe Nsanzimana (second left) and other

articipants uring t e associations aunc in wan a

Rwandan Trade Minister Hon. Vincent Karega receiving a gift from

c airman, apter an is wan an apter counterpart

rade Minister Hon. Mukhisa Kituyi (in

at), Hon. Njeru Ndwiga (second right)

nd KRBA members at the launch of the

ssociations Rwanda Chapter

Kenya Rwanda Business Associationopens new chapter

Trade


26/40

6 East Africa Business Focus April - June, 2007

F

our-year-old Martin never knew

his parents. His earliest memories

are of his grandmother, who looked

after him. He also remembers thesisters from the convent who used

to give them food. He was often hungry and

somet mes n pa n rom t e ggers nsects

t at ay eggs un er toe na s n s eet.

The nuns could not help being aware of his

condition, noting that Martins grandmother

was not capable of looking after him. Apart

from being in poor health, she was also

mentally challenged, and looking after

her grandson presented her with many

difculties.One day, when he was about

three, Martins grandmother took him to

the convent and left him there. Concerned,the sisters went to her house but found that

she had abandoned her home and could not

e trace . ventua y, t e nuns too art n

to a near y ren s age w ere

he was taken into a family house and given

a new mother, brothers and sisters. Today

Martin is a happy, condent boy who attends

the neighbouring SOS Hermann Gmeiner

School and has a bright future ahead of him.

Giving a homeand a futurartin is typical of many children wh

grow up in SOS Childrens Villages, havin

been orphaned or abandoned at a young ag

SOS Childrens Villages believe that ever

c s ou e ong to a am y an grow u

with love, respect and security. The missio

of the organisation is to build families fo

children in need, helping them shape the

own futures and sharing in the developmen

of their communities.

In many developing countrie

unemp oyment, eavy e ts an poo

arvests are every ay c a enges, w t

children often bearing the brunt of familienancial and social difculties. The effec

of the Aids pandemic and other diseases als

weigh heavily on children in less develope

countries, where the social support networ

is becoming even weaker. Violence, negle

an e ng orce to ve on t e streets are re

t reats or t ese c ren.

SOS Childrens Villages is an independen

non-governmental social developmen

organisation which has been working to me

the needs and protect the interests and righ

of children for nearly 60 years. They opera

over 450 villages in 132 countries anterr tor es, o er ng ove, protect on, respec

e ucat on an me ca care n a am y ase

environment. Around the world, over 55,00

children and adolescents enjoy the love an

support of an SOS family and over 650,00

people benet from SOS Childrens Village

educational, health and social centres.

There are currently four SOS Children

ages n enya, t ree n wan a, our

urun an two n t e emocrat c epu

of Congo. Each village cares for an averag

of 120 children (sometimes more) where the

are looked after by specially trained SO

mothers in family houses, together with the

SOS siblings. Many of them attend SO

kindergartens, schools, vocational trainin

centres, a open to commun ty mem e

as we w e ot ers are at un vers ty o

college. All are provided for until they ca

look after themselves.

Children are only admitted to an SO

Childrens Village if they cannot - or ar

unlikely to - return to their biologic

Charity


27/40


families. When families have difculty in

providing for their children, SOS Childrens

illages has programmes which are designed

o strengthen families, either through

e ca , soc a an e ucat ona support,

or t roug ncome generat on sc emes.

Through these programmes, families learn to

cope with crises which might otherwise force

hem to split.

Apart from villages, SOS also operates

social and medical centres, kindergartens,schools, day care centres and even hospitals.

n n countr es w ere c ren may e

emporar y sp ace ue to con ct, am ne

or other crises, SOS also operates emergency

elief programmes, helping children to

survive until they can be reunited with their

families. The organisation was founded

n 1949 to improve the lives of deprived

children after the Second World War. The

challenges that these children faced then

are similar to those faced by many children

today hence the need for continuation.

Due poverty, disease, war and natural

sasters, over m on c ren

wor w e ve w t out t e support o one

or both parents. Without a family to support

them, these children are deprived of what

others may take for granted; access to

health, education, food, shelter and care; all

requisites for a good start in life.In the family set up, children can develop

an ent ty, se con ence an n v ua

ta ents. trong an car ng am es are

essential for ensuring a peaceful society for

the future.

As a non-prot making organisation,

SOS relies on the goodwill and generosity

of supporters to maintain its hundreds of

projects and to expand and develop the

assistance it provides to children and families

in need around the world.

Indeed, in many non-European regions

where SOS works, the available educational

an vocat ona tra n ng ac t es are

na equate an t e organ sat on o ten runs ts

own kindergartens, primary and secondary

schools, and vocational training centres for

the children and young people in their care

and also for children from the neighbouring

communities. Priority, however is given tothe poorest families.

ee ng t e goo wor t at s nvo ve

n, a t ose w o ave somet ng to spare are

asked to assist in making a difference in the

lives of these children.

If you would like to know more about SOS

Childrens Villages, Log onto: www.sos-

childrensvillages.org or www.sosea.org n

topoor children

Top: An SOS mother supervises children during a meal while and an older child enjoys a

r e w t a r en . ac ng page, c ren on t e r way to sc oo

Charity


28/40


y Kimani Chege

African science is coming out of the

woods at last, thanks to renewed

nterest y r can pres ents.

t t e ea ers awa en ng to t e

eed to increase research funding, scientists

re keenly watching and waiting for the shot

n the arm that could mark a turning point in

he continent.

African science has for a long time lagged

behind due to poor funding by governments,

eav ng sc ent sts w t tt e room or

nnovat on.While most countries, especially in Europe

nd Asia, have used science to develop

heir technologies and economies, Africa

as become a permanent importer of both

echnology and expertise.

However, scientists in Africa had reason

o ce e rate w en t e r ca n on summ t

n s a a recent y e cate t e w o e

eeting to talks on science and technology.

The recognition by heads of state of

he role science plays in the development

nd utilisation of the continents natural

esources came as a surprise to many.According to one scientist, the AU summit

as a ay o rec on ng or r can sc ence.

owever, t e e cat on o t e summ t

o science and technology was enough to

promote renewed interest.

While science attracted little attention

compared to the launch of the Africa Year of

ootball, scientists acknowledge that it has

aken a long time to bring the sector to the

eve o ea s o tate n r ca.

Though most African nations shy away

from funding research, Rwanda has moved

o lead them in providing adequate nancialsuppport for science and technology, thereby

encouraging innovative science.

President Paul Kagame, an enthusiast of

sc ence an t ec no ogy, to r can ea s

o tate n s a a t at s country

as not only providing enough funds for

esearch, but was willing to double budgetary

llocation to scientists.

According to him, Rwanda was pushing for

n African countries resolution to allocate at

Time for experimentsRwanda shows the way to boost funding for research in science and technology

Clearly, it is not just aboutinvestment in science and

technology, but also about

improving the efciency of

this investment for greater

impact in all aspects of

national life

President Kagame

least one percentage of their Gross domestic

Product (GDP) to their science sectors.

wan a as a ocate at east . per cento ts to sc ence n t s nanc a year

and the sum is set to double in the next ve

.

If Rwanda approves this funding to

three percent, it will be at par with most

developed nations whose allocation for

research has helped boost several sectors of

t e economy.

e un ng s now support ng wan a s

science and research institutions - including

the teaching of science in primary and

secon ary sc oo s, an secto

based centres of higher learnin

and research in agriculture, health

infrastructure, environment an

biodiversity.

2005 was a major milestone fo

us in that we begun to implemen

our nat ona po cy on sc enc

tec no ogy an nnovat on.

important goal of this policy is t

increase the number of scienc

students in tertiary institutions

the target being 70 per cent of th

student population, Kagame tolAfrican presidents.

e a ress ng t e

umm t, agame note t

most countries need to give mor

attention to scientists who hav

called for increase in funding t

promote research.

President Kagame noted: W

are spending one percent of Gros

omest c ro uct on sc enc

technology and research in our countries a

recommended by African science minister

is this not too little too late?The emphasis is the need to prioritise o

how the money is used to meet the mo

pressing needs of the continent.

ear y, t s not ust a out nvestmen

n sc ence an tec no ogy, ut a so a ou

improving the efciency of this investmen

for greater impact in all aspects of nationa

life, President Kagame added.

or him, it is about applying science an

technology holistically - in all levels o

education and training, commercialisin

eas, eve op ng us nesses an qu c en n

t e pace o wea t an o creat on.

The Rwandese President also praise

other regions in Africa for promotin

nnovation, calling them islands o

nnovation with the potential to prop

Africa into development.

With a political will and resource

t ese reg ona ynamos can prov e t

momentum nee e to spee up r ca

transformation through science an

technology.

Science & Technology


29/40


These nascent centres must become the

basis of pooling African resources to build

iable networks for larger economies of scale

nd greater impact on the ground.

n a pract ca approac to encourag ng

oca stu ents to ta e up sc ences, e sa

plans are underway to initiate a regional

science tournament modeled on the East and

Central Africa football Challenge Cup.

Rwanda has been instrumental in funding

football competitions in the region and is

exploring ways to duplicate this success in

sc ence.

u ng on t e successes o t e gaInstitute of Science and Technology, we

ntend to create a scholarship fund for bright

nd capable youth from our region to study

science and technology at this institute,

resident Kagame announced.

His calls were supported by African

res ents an sc ent sts w o saw t s as an

examp e o ow r ca can tap ts resources

using science to develop.

We just need two or three more presidents

ike Kagame who can stand by us when we

sk for more fundsfor research on issues

hat will help the common man, said onescientist attending the AU event.

t a meet ng n a ro ear er ast year,

sc ence m n sters agree to o y or

llocation of at least one per cent of GDP

o science. They also proposed the setting

up of an innovation fund and an African

presidents science council.

However, during the AU summit whose

ain theme was science, technology and

c mate c ange, t e proposa to orm t e

presidents council was shot down. It had

been suggested that several presidents be

pooled into a club to share ideas on sciencend technology with advice from experts.

Professor Calestous Juma, a Kenyan

scientist who also heads the AU panel on

odern biotechnology, asked African heads

o tate to use t e r n uence to ncrease

funding for research.

He said the formation of the presidents

council could provide the required link

between science and executive decisions.

Bringing science and technology to the

centre of Africas economic renewal will

require more than just political commitment;

t will take executive leadership, he

dded. This challenge requires concept

champions, who in this case will be heads

o state spear ea ng t e tas o s ap ng

their economic policies around science,

technology and innovation.

Prof Nagia Essayed, the AU commissioner

for science and technology, said her

commission was increasingly talking to

governments to allocate more funds to their

m n str es o sc ence an tec no ogy. ost

of the recommendations her committee had

put forward, including the Cairo report,

have been adopted by the AU executive

committee.

She said the commission was also

encourag ng t e part c pat on o governments

in science. This includes the raising of the

required quorum to make an executive

decision in AU meetings

Through a decision reached by the AU

Executive Committee in Addis Ababa,

Ethiopia was asked to raise the quorum

requ re e ore pass ng a n ng reso ut on

o r can n sters o c ence an

Technology to 56 per cent.In the Cairo ministerial meeting which

passed several important resolutions on

science and technology, 27 of the 53 member

States failed to send their ministers.

We have realised that this is an imperative

ssue or . owever w en t ere s ow

quorum n a m n ster a meet ng, we on t

say we cannot discuss and agree on issues

until we have enough participants.

Bringing science and

technology to the centre

of Africas economic

renewal will require

more than just political

commitment; it will take

executive leadership

Kagame champions science drive

Science & Technology


30/40


China woos AfricaEconomic giant has been making inroads into the African market and its inuence has

been growing by the year, reports Marceline Nyambala

na s earn ngs rom ts tra e

w t r ca as grown y

per cent over the last seven years.

In 2000, the value of the China-

Africa import and export trade exceeded 10

on, accor ng to o c a gures.

The sum jumped to more than 32.17

billion in the rst ten months of 2006 with

exports and imports hitting 15.25 and 16.92

billion respectively. It is now estimated that

na s tra e w t t e cont nent stan s at

more than 40 billion and is still increasing.

eanwhile, Sub-Saharan Africas economic

growth rate has nearly doubled since 2000

nd analysts attribute this partly to increasing

tra e w t na.

China has in the past hosted African headsof state in many Sino-Africa trade fora. The

irst Ministerial Conference of China Africa

Cooperation Forum, 2000 (FOCAC I) set up

the African Human Resources Development

und.

ur ng t e secon m n ster a con erence

of 2003 (FOCAC II), China resolved to

exempt import tariffs for certain countries to

ease their entry into the Chinese market.

It later launched the 2004-2006 China

Trade

President Hu Jiantao

The inux (or dumping)

of such cheap imports

has been blamed for

the death of several

indigenous industries,

such as the textile sub-

sector in some of Chinas

African trade partners.

r ca ntergovernmenta uman esources

eve opment an, w c t e nese

Ministry of Commerce has used to trainprofessionals from 48 African countries

n trade, investment and economic

management.

In November 2006, China hosted more

than 40 African heads of state in the Beijing

umm t o t e orum on na- r ca o-

operation.

In terms of investment, 77 Chinesefunded

enterprises in Africa were started in 2004.

Other statistics put the number of Chinese-

funded enterprises at 715, with the

operations in Africa ranging from

trade, processing, manufactur

transportation and agriculture.

e ar ast country as spen

ons o o ars secur ng o - r n

rights in Nigeria, Sudan and Angol

and has exploration or extractio

rights deals with Chad, Gabo

Mauritania, Kenya, the Republ

of Congo, Equatorial Guinea an

Ethiopia. China has also invested

t e copper n ustry n am a an

ongo; t m er n a on, amerooMozambique, Equatorial Guinea an

Liberia.

In 2002, a Chinese company, Don

Song, opened East Africas r

concrete poles factory at a cost of

million in Kenya. China also built th

a ara - anzan a- am a a wa

ne.

China mainly exports low-co

nished products to Africa. Its main produc

are machinery and electronics, textile an

apparel, hi-tech goods, while her impor

from Africa concentrate on crude oil, iroore, cotton, diamond and other natur

resources. or t ose r can countr es t

o not ave muc o or raw mater a s t

export, trade with China is not as attractive

uring , 25 African countrie

received zero-tariff treatment or speci

preferential tariff rates on products bound fo

China, ranging from food, mineral and texti

products to machinery and electronics. Chin

a so encourages capa e nese enterpr s

to invest in Africa to create jobs and achiev

common development.

wanda has not been left behind as it one of the upcoming economies that Chin

has an interest in.

The governments of Rwanda and Chin

signed eight agreements between 197

an or econom c an tec no og c

co-operation. Some of the projec

supported by China in Rwanda include ric

transplantation and reclamation project

sugar-renery; a cement plant that is no

managed for the Rwandese governmen


31/40


A Chinese worker in a silk factory

Trade

by a Chinese company; construction of

the Kigali highway, a sports stadium and

hospital expansion. Chinese companies

have also been involved in other road and

r ge construct on, y ropower an c v

eng neer ng pro ects.

The Chinese government also endorsed

wanda with the Approved Tourist

estination status as part of its effort to

facilitate bilateral trade. This raised to

nearly 10 the number of tourism destination

countries recommended for Chinese tourists.

enya, anzan a, m a we, un s an

t op a are among t e ot er ene c ar es.China-to-Rwanda trade has been

ncreasing steadily. In 2002, the value stood

t 9.05 million, with imports taking up

5.19 million and exports taking up 3.86

million. Chinese exports to Rwanda include

cheap textile goods, light industry articles,

gr cu tura too s an errous meta s. na

mports ma n y n o um an tanta um or, an

aulonia logs from Rwanda.

Chinas Presenceut not everyone is pleased with Chinas

presence in Africa. Unease appears to berising across the continent as the Chinese

ecome s gn cant p ayers an n some

p aces, t e om nant ones. uge quant t es o

cheap Chinese-made products are suddenly

vailable across the continent. The inux

or dumping) of such cheap imports has been

blamed for the death of several indigenous

ndustries, such as the textile sub-sector

n some of Chinas African trade partners.

r can an estern act v sts say na s

coziness with the troubled governments of

Angola, Nigeria, Sudan and Zimbabwe are

undermining efforts to nurture democracynd improve human rights there.

But when Chinese President Hu Jintao

toured Africa, he dispelled concerns about

s country s grow ng presence on t e

cont nent. e sa na s eve opment w

not be a threat to anyone but would create

opportunities and space for development

broad. He told reporters in Nairobi that

China followed a policy of non-interference

n the internal affairs of other countries.

Chinas trade with Africa grows

without donors or investors dictating the

agen a. en a s sa an one, t rema ns

to be seen how Chinese invasion of Africa

will inuence global politics and business

trends.n

t er cr t cs ave warne r cans t at

when the deal is too good, they should think

twice while others say it is about time Africa

dened its destiny, put in place governance

structures and anti-poverty programmes


32/40


Time has run out for traders who have

hitherto been enjoying an unofcial

tax holiday. It is time for them to meet

the taxman, but they do not look ready

for the formal introduction.

n y ast year, un re s o t em, e

by opposition mps, marched and chanted

outside Times Tower to protest over the

deadline imposed for traders to install

Electronic Tax Registers popularly known

s ETRs. This time round, in the words of

the KRA Commissioner General Michael

aweru, t ere s no escape or tax eva ers.

e cra ty operat ves - repute or tras ng

Safaricoms security code system that was to

render stolen mobile phones useless - have

found their superlative match in the name

of the Kenya Revenue Authority which

has been working round the clock to get all

taxable people pay taxes.

e omm ss oner or omest c ax to

me a wor s op at t e n sor o u

some time last year that time had come for

each one to give to Ceasar what belongedto Ceasar and to God what is His.

The arrival of the ETRs is set to

revolutionalise the way Kenyans do

business. Except maybe for your monthly

s opp ng at t e supermar ets, rare y oes

one rece ve rece pts or t e omest c

ccessories bought at the nearby kiosk or

from hawkers who ply their trade on the

highways during trafc jams. KRA is now

casting the net wider to ensure that even the

kiosk operators pay Value Added Tax (VAT).

You will concur with me that this is no mean

tas , ut t e toug ta ng omm ss oner oax s e n te t at t w appen, come ra n

or sunshine.

The government having trimmed down

to domestic borrowing at a time when

donor funding is erratic, has probably no

choice but to use the authority to raise as

much revenue as possible. Indeed, KRA is

target ng over s s on per year,

money t at w e rawn rom tax payers

pockets.

KRA tightens noose on tax cheatsAs Government seeks to raise more revenue, the taxman is reaching out to more traders to give

to Caesar what is his, writes Newton Mutuma

ypot et ca y, every o y pays

per

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