Local materials will deliver affordable housing – German investor

Eckardt Dauck is the chairman and chief executive officer Strawtec Building Solutions, a Germany-based company that manufactures straw board panels. These are primary building materials for mass housing and commercial construction projects.Dauck is currently setting up his business in Rwanda. He spoke to Business Times’ Peterson Tumwebaze on how the company will change the dynamics in the real estate industry and what to do to build affordable houses.This is your first investment in Africa. Why did you choose Rwanda?We had several discussions with the board back in Berlin, Germany, and members suggested several countries which included Ethiopia, Rwanda, South Africa, and Burundi. Given a stable political and economic environment, Rwanda emerged the best destination. This country is not just a developing country, but it is actually developing.The World Bank’s Doing Business report is actually right in its assessment that ranked Rwanda as the second best country on the African continent for business. The political will is there and everyone seems to know their responsibility, which is crucial in economic development.Rwanda needs about 100,000 affordable housing units every year to meet growing demand. What do you think should be done to meet the target?The fact that this country is positioning itself to become a regional investment hub, means it is attracting many people who obviously need these housing units. So, to be able to meet this demand, you will need to find a mechanism of substituting imports in terms of construction materials. This will not only address the issue of affordability but also create enormous jobs for the Rwanda youth.Secondly, while it is good to attract people who understand business and planning, there is also a need to invest in vocational training. This will address the challenge of limited expertise Rwanda is experiencing.How will your products, made locally, change the dynamics?We are talking of a flexible, affordable building solution that can only come from wheat straws. This will not only address the challenge of high cost of construction but also provide farmers with an extra income earned from their wheat husks.A reduction in trade deficit is very vital, and this can only be achieved through reducing on your imports. So, what we are saying is that substituting materials like cement, gypsum board, which currently account for a big portion of the country’s imports, with locally made straw boards will come as a big boost for the country. This is what most developed economies are now using.We are also looking at using environmentally sustained methods of construction, which a growing economy like Rwanda needs most.What do you think Rwanda can do to develop environmentally friendly small and medium enterprise?I believe Rwanda’s local entrepreneurs can do what actually foreign investors can do if they have access to capital and technical knowhow. All that they have to do is to seek partnerships either with government or with foreign investors.In this case, the role of foreign investors should be to come and work alongside local entrepreneurs so as to build a strong Rwanda.Are there lessons Rwanda can learn from Germany’s experience in the Euro Zone as the country gets into regional integration?Rwanda is blessed to be part of the EAC (East African Community) because this will not only increase its bargaining power on the international scene but also in terms of market availability. As an investor, I already know that the country is landlocked and its domestic market is relatively small. However, I am actually looking at Rwanda in terms of its regional influence. That is what Germany did in the euro zone—to take advantage of the big market.It is also very important to understand that you stand to benefit from producing quality products than quantity.Germany can never compete with Chinese in terms of pricing products because Chinese products are very cheap. However, you still have millions of people going for German products because of the quality they possess. This is what Rwanda must learn and I am sure Rwanda is doing it right.

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Local materials will deliver affordable housing – German investor