Feature: Rwanda and her bustling construction industry, controversies not withstanding

Just like many other sectors in the country are experiencing a whirlwind expansion and progress, the construction industry is no exception. The vigorous constructions which are punctuating Kigali and its suburbs can be attributed to the increasing commercial activities in Rwanda and Kigali in particular. There are many commercial structures which have been erected in many places around Kigali and these have been rented by banks, offices, restaurants, supermarkets, electrical appliances shops and other sorts of businesses. This indicates that there is demand for the construction products and out of this business many people have accumulated wealth. According to Nathan Loyd the founder of DN International, a construction company, the construction industry is forward moving in Rwanda. This can be evidenced through his own success story as a real estate developer. Within a period of one year after he had started, the company’s project value grew from USD50,000 (Rwf28 million) to USD100,000 (Rwf56.6 million). DN International is now estimated to have projects worth USD20 million, with its investment in real estate projects around Kigali. There is ready market for the sector and this has been due to many factors among which include the fact that there are now ready land tittles for whoever buys or owns land there by guaranteeing total ownership of land. This is opposed to previous years where all the land belonged to the government. Some of the stakeholders in the industry also point that government has had a positive role in this trend. This is seen in its efforts aimed at facilitating private sector development as well as creating a favourable atmosphere for local and foreign investors. However, the construction and modernization plans as they complement each other, have not meant harmony to everyone. There have been contests and controversies between the relocated people and Kigali City Council. For example previously controversies emerged between the former residents of Ubumwe cell who owned the dismantled houses in lower Kiyovu. The residents who were later expropriated to Batsinda Estate in Kagugu were contesting the timing of the ultimatum instituted by KCC to start paying for the new houses they occupied since June this year. Most of them were saying that KCC never gave them an option to come here, adding that some of them are extremely poor and do not have jobs, others are suffering from HIV/Aids, and some of them are aged people who have retired. Residents have complained that the bank loan with 14% interest to be paid in twenty years was exorbitant. “This does not make sense, with 14% interest, we are likely to pay about Rwf11m in 20 years, it is three times the cost of the house,” a resident who preferred anonymity said. “That is too much money. They said they were working with the bank to help us acquire loans and pay for this house, and now we are going to work our entire life for the bank. Some of us have never had such huge amounts of money in our families,” another distressed resident was reported by The New Times as having said, about two weeks ago Residents claim that they pleaded for help from the Mayor of Kigali City in a letter since July but never got a response. Ephraim Rusurabeza, the Kigali City official in charge of Batsinda housing project when contacted, noted that everyone was given a choice of either being expropriated to Batsinda housing Estate or elsewhere. Rusurabeza added that Batsinda residents stubbornly don’t want to pay and that most of them have refused to even do as little as inquiring information of how they will pay from the housing bank. Responding to the query of some residents not being paid since they were expropriated, Rusurabeza said that several people were asked to choose whether to be paid or keep their money in the bank as a way of saving. “During the expropriation, everyone was given a chance to choose whether to be given cash or hold their money to start with when time of paying off the loan comes.” However according to Bruno Rangira, KCC’s Communication and media officer, KCC designed a process where those people (who preferred to keep cash) have to sign contracts for the payment of the houses, which they have done. “They have all signed those contracts and presently the city and Caisse sociale are working out the modalities of payment through the Housing Bank. So they will receive the remaining monies at least next week.” On the projects to support the vulnerable poor who were relocated from Kiyovu, Rangira says KCC has trained women in basket weaving, the youth in brick making and it has helped in forming 7 cooperatives among these people. He further revealed that Kigali city is also helping these residents by putting in place a support fund in which the city will provide Rwf 500,000 for each family moved-(Rwf250,000 will be put in the support fund and another 250,000 will be paid to each family to support it). On the issue of payment of the houses, Rangira said that over 80 people have paid the full amount for the houses. In an earlier statement, Rangira revealed that KCC was involved in a continued partnership with a wide range of stakeholders. He said that it was important that they all work together for the success of the housing project which seeks to provide decent living conditions for the slum dwellers. Rangira revealed that the SSFR was to fund the housing project, while BHR’s role was to facilitate lower Kiyovu residents acquire loans according to a memorandum of understanding the three parties signed. However, Gervais Ntaganda, the Director General of BHR earlier revealed that his bank does not have any understanding with any institution but deals with individuals in case of acquiring loans. Ntaganda confirmed having received the cases from Batsinda seeking loans but on individual basis not as a certain group of people supported by any institution like Kigali City or SSFR. However a statement from KCC Kigali city council asserts that through a Memorandum of Understanding engaged the Social Security Fund to fund the project and Housing Bank of Rwanda as a future affordable loan provider. It adds that before this project was started, KCC engaged the residents on several occasions and the residents also got a chance of seeing a model house which KCC had constructed to show them how their residences will look like and they appreciated. These homes were targeted to provide water, electricity, proper roads, drainage system and biogas for cooking and other fuel needs. The statement adds that during the entire expropriation and construction exercise, the City continued to liaise with the locals through their representatives and occasional community meetings. This was to ensure that the beneficiaries were given an opportunity to continue to monitor the progress of the project. The final value for the houses is recorded at Rwf 3.5 million with Kigali City providing infrastructure (roads, drainage, electricity, water and biogas) at no cost to the residents. According to Rangira, Kigali City continues to play a facilitating role through negotiations with the Housing bank to provide a guarantee on behalf of the beneficiaries and to request for reduced interest rates on their loans. For a sense of ownership and responsibility to their properties, it is required that the beneficiaries apply the compensation funds awarded to them to purchase rights to these homes. The City will then facilitate them in obtaining all legal documentation, the statement adds. This project is part of a bigger scheme to develop a residential hub in Kinyinya Sector, an area of over 440 Ha. “This is a continued partnership that involves a range of stakeholders and it is important that we work together for the success of this project for it seeks to provide decent living conditions for our slum dwellers,” stressed the statement issued by Bruno Rangira on behalf of KCC. There is a general fear among the urban poor in many areas around Kigali that their houses and land they have occupied for many years are going to be demolished, especially after witnessing the previous demolitions in Kigali and Gasabo. To many people it has been quite perturbing that ever since the expropriation process ended many months back, there has not been any sign of developmental activity going on in lower Kiyovu. When the Sunday Times contacted KCC on this issue, it was revealed that the City is partnering with a Singaporean firm, SCE Surban, for technical support. And through this a detailed physical plan has been developed and this place is going tobe turned into a new Central Business District (CBD). “On March 14, 2009 we launched the sale of plots in the CBD. The sale is being done by Caisse sociale as a partner in this project. The CBD was even part of the projects marketed in the recently held RDB Construction investor’s roundtable,” reads the statement. However, like all things Rwandan, there is always a spirit of optimism. Controversial or not, the critics are bound to be proved wrong when all is said and done. The construction industry is still almost virgin and is there for the taking for any prudent investor. With the advent of the Kigali Master Plan, Rwanda is bound to see new majestic structures in her skyline. Email: Gahimore@yahoo.com