The Dangers of Doing Business in Rwanda, Foreign Investors Beware!

Foreign investors beware! According to new laws, your business too could be seized as “abandoned” if you do not reside in Rwanda.

Rujugiro

(WASHINGTON DC) - The Constitution of the Republic of Rwanda makes for good reading and at first glance, one feels hope and prosperity for the landlocked country of Rwanda. However, once one embarks on further research of how these amendments are put into practice it is a quick lesson in the saying “not worth the paper it is written on.”  For example, the constitution declares there is freedom of speech, freedom for political groups to exist and protection of human rights. Anyone who has researched issues on Rwanda knows that these three areas are not in existence in the country. The political groups that do exist inside Rwanda are all connected to the ruling party of the RPF of which President Paul Kagame leads.  Human right violations are rampant throughout the country as well as in neighboring countries and freedom of the press does not exist.

Further entertaining reading is the Law No. 07/2009 of 27/04/2009 relating to companies and business management within Rwanda. One such case is that of the Union Trade Center (UTC) which is the largest shopping center in the country. Tribert Rujugiro Ayabatwa, who now lives in South Africa, is the founder of the Union Trade Center (UTC), in August the Rwandan government set into motion a move to amend its laws to justify illegal seizure of his property. The Rwanda National Prosecuting Authority on Aug. 8 instructed Ayabatwa's bank, Access Bank LTD, to freeze Ayabatwa and his wife Nathalie Mukagatete's 12 accounts, citing an "ongoing criminal investigation."

In order to justify this illegal move the Rwandan Parliament has begun to draft a new law relating to Management of Abandoned Property in which it defines what constitutes an abandon business. In the case of Mr. Ayabatwa he does live out of the country but his board of directors for the UTC do reside within Rwanda and oversee the UTC. Further, Mr.  Ayabatwa has a representative who attends to his interests regarding the board in the country.

Interestingly, this is not the first time the Rwandan Government has used this maneuver to seize “abandoned businesses” in Rwanda. Valens Kajeguhakwa' bank was seized and went into exile in late 1990s. Alfred Kalisa suffered same face - imprisoned for 5 years in the mid-2000s. Miko Rwayitare who sought to buy the national telecom was the opportunity and instead the company collapsed, leaving RPF's MTN enjoying monopoly.

All of these facts call into question an event that will be hosted in Rwanda October 28-31, 2013 called Transform Africa Summit, which seeks to bring together investors from all over the world to invest in broadband services throughout Africa. A noble cause indeed for everyone deserves access to information and services that only broadband can deliver. Yet, how can investors feel safe in such an environment?

President Paul Kagame has apparently acted in a vindictive manner in seizing the businesses listed above under false pretenses. His attack on Tribert Rujugiro Ayabatwa and subsequent seizure of the UTC is nothing more than a move to steal the wealth that this private business earns. Yet, what some may not know is that Mr. Ayabatwa was the single largest financier of RPF struggle from 1990-1994 as the RPF prepared to return to Rwanda by force.

Foreign investors beware! According to new laws, your business too could be seized as “abandoned” if you do not reside in Rwanda. Simply look to the examples listed above. If President Paul Kagame will turn on his former advisors then there is no limit to his malicious nature.

For more information about Ayabatwa, his businesses and his philanthropy, go to: http://tribertrujugiro.com/