CNBC owners eye bigger investments in Rwanda

Last Thursday, CNBC Africa, the pan-African television Network that specialises in business news set up its East African headquarters in Kigali. The office will serve the network’s interests in the greater region and has caused excitement across the country with expectations that it will help improve coverage of Rwanda and regional integration initiatives. The coverage experts say could lead to increased interest by foreign investors. The New Times’ Collins Mwai spoke to CNBC Africa’s Co-founder and Chairman Rakesh Wahi, who was flanked by his son Sid Wahi, who is the chief executive officer of the network for insights into their work in Rwanda and the region. The CNBC Africa co founder is also the director of CMA Investment Holdings, an investment vehicle of his family which consolidates investments that include interests in the media, education ,and IT. Below are the excerpts: What informed your network’s decision to establish the regional headquarters in Kigali as opposed to larger markets in the region? Before giving you insights into our move to establish our regional headquarters in Rwanda, it is important to understand our broader business. We have different businesses in the family; we have an IT business, education business and media. We came here (Africa) in 2004 to evaluate the setting up of a business news channel. It was driven largely by the perceptions about Africa at that time. Everyone was talking about gloom and doom and the Western media was portraying Africa in a very negative light. The economic story of prosperity was not talked about. That was the genesis. We want to be the largest aggregators and disseminators of business news on the African continent. We set up our headquarters in Johannesburg, South Africa. We opened our east African reporting bureau in Nairobi. It was a bureau, not our headquarters. It was opened in 2007 because, at the time, a lot of economic activity was taking place around Kenya. In West Africa, we set up two bureaus, one in Lagos, another in Abuja. Since the World Economic Forum that was held in Cape Town, we also had decided to open another bureau in South Africa. Over the last nine years, we went out to different countries and now we have a presence in all SADC countries, we also have a presence in Gabon, Ghana and Mauritius. We came to Rwanda in 2012 and started reporting on the country in 2013. The last two years have been a fantastic journey for us. As a business person, what you are looking for is consistency and continuity of policy and this is something that we found here. The operating costs are better than in most parts of Africa, the speed of doing business, it took us less than a day from the government side to have our company set up. The process to get visas was a refreshing experience, I got my residence visa for five years in one day (business visa). The government shows response to the needs and, therefore, if they have to act, they have the ability to act which you find gets lost in the bureaucracy in many countries. There are various factors that led to the decision of setting up our region hub in Kigali. What is CNBC Africa’s expectation of the country and the region at large? The idea of being here is to actually aggregate a lot more and get value of the East African Community. Rwanda is playing a very central role in this development and there is a vision of the President on the role that the country should play in the larger Community. East Africa has a population of 250 million if you count Ethiopia; with a Gross Domestic Product of about $ 300billion and, therefore, we want to make this the epicentre of all our activities. From here, we will be able to look at opportunities in Kenya, Tanzania, Uganda, Ethiopia and all the other territories around the region. That’s what makes it interesting for us, we want to capitalise on this market, the region is growing, the population is young, we think that the future here is bright not just in the context of the region but also in the context of the entire continent. You are expanding the presence of the television network at a time when media practitioners are staying up at night worried that social media and other platforms are ‘eating’ into the market of traditional media. Do you know something they don’t? We are expanding on all the imperatives mentioned above. You cannot remain old school; in fact, I am a ‘dinosaur’ when it comes to our business. This is why my son, who is 27-years-old now, joined the business when he was 22; he is the future of our business. You need your future management structures to be a complex mix between the old and the youth. He knows how people of his generation consume information. They do not read newspapers, they do not read books and the percentage of their time that is spent on traditional access of information is much less than modern platforms. You have to start listening to the youth; there are a lot of organisations that fail because of the belief that the founders know everything while actually they don’t. We have to start paying attention to this whole era of disruption. What you cannot take away from the core is that content is going to be needed. That is our business, creation of content in a knowledge economy. How it is then taken out is left for him (Sid Wahi) and his team to make it sharper. You will find out that if previously there were seven people needed to put together a show, in this generation, they want one person to do it. It is not that jobs are going to become less; you are going to become more productive. That scale of efficiency is what is going to differentiate companies in the future. The evolution is not so much on whether the business will be there or not, it is how it can change, how people are going to absorb it and how we are changing to make sure that their needs are being fulfilled in an efficient manner. CNBC co-founder Wahi makes a point during the interview with The New Times. (Teddy Kamanzi) For a long time, international media have not done justice to Africa as a continent. When they are not labeling it as a poor and sick continent, they are telling half truths and unsubstantiated rumours. Do you think at some point Africa has given them a reason to portray it in such a way? It is a combination of everything; you cannot blame somebody from outside without taking some responsibility yourself. If you look at some of the developed countries, they have a difference of opinion amongst themselves, among politicians and business leaders, but when it comes to national interests, they unite. They will not compromise a country’s respect and its sovereignty in public. That responsibility needs to be understood by everybody; when disagreeing on something, on what platforms and how are we doing it. You will find that in USA elections, they disagree and campaign against each other in the primaries but once they elect a president, they follow his lead. They do not wash their laundry in public. That’s the responsibility we have as citizens of a country and must remain objective. There is a nationalistic pride that you must have and you should know your responsibility towards it. There is a system by which you can address the problems that are there. We are democracies and we are trying to build democracies even though the structures of democracy are different in various countries, there is a method by which these things are discussed, debated and proper decisions taken. The media will pick on things when they are allowed to do it. They will pick on things when communication is not being done properly and they start speculating. And that is when good leaders deal with those communication messages before speculations begin and people make stories out of them. If you know there is something going wrong, address it before somebody puts you to task. They are doing it because the world wants to know what is going on and, therefore, they speculate. At times the speculation is against national interests and everyone else, but most times people outside the country do not really care. Is it too late to try and change the narrative? And if not, how can it be done? I think, first and foremost, we need to stop being defensive about everything. The biggest problem is that when somebody asks you a question, you think you have done something wrong and you start reacting in a very different manner. I think African countries, leaders and corporates, should stop having a defensive mechanism at the forefront of all discussions. We should not just assume that because somebody from the West is raising a question, you are on the wrong side. They (Western media) do not understand the ground and realities you are dealing with. We also need a proper communication strategy. You have been operating in the East African region for about nine years, what would you say of its economic outlook? One of the words of advice I give to people is that when you are in an emerging market like Africa, you shouldn’t be in a hurry to do things. One of the common mistakes is that most people opt for shortcuts because they want quick things which is wrong. I think companies should take their time in reviewing what is on the ground, make sure they get the regulatory approvals and make sure they comply with the tax regime in place. Once that is done, you can establish what you are trying to do. That has perhaps been one of the success practices for us, we take an adequate amount of time to do our homework to make sure we have got our ducks in a row and we can set up a strong foundation. Once you have done that, other challenges that come in are not so much around fundamentals it is more around change in market conditions. In 2008, the whole global economy collapsed and you can’t blame Africa for that, each country reacts differently to challenges. As a business you need to adapt, cut costs and continue in your path. But when you have done your homework well, you have the right teams, and you have structured properly, you can get through. Another aspect we focus our attention on is people. You will be happy to know that 100 per cent of our staff in Africa today are African. We do not hire expatriates and bring them from oversees when we can avoid it. In some areas there are special skills where we bring people in to train the local people; we also have strong internship programmes. The core of any business is not the products and services but the people. If you get the right people and train them with a long term view of developing them, you will be successful. However, the region has been termed as somewhat high risk... I do not think any of these territories are more risky than anywhere else; you just have to manage the risk and its perceptions. Risks can be qualified in very different ways, there are risks that are created by man and other risks. Any risks that are created by human beings, you cannot mitigate them, that is the nature of human risks; you have to adapt to it. Other risks ,especially when you are getting into a country, can be managed quite easily. Going forward, what are your firm’s long terms plans in Rwanda? We are looking at the ICT sector very closely. We want to invest in the IT business here; we own two universities, one in Dubai and one in Ghana. We are looking at setting up a nursing programme here in Rwanda. We want to set up a research centre here as well. We want to make this a hub for everything we do in the east African region. editorial@newtimes.co.rw

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CNBC owners eye bigger investments in Rwanda