Monthly Archives: July 2012

Guide to Kigali

A guest post by Niti Bhan
Getting There is not difficult  as there are Kenya Airways flights and also Rwandair flights. Our experience with Kenya Airways was not the best however. Our flight (via Bujumbura, Burundi) was on time and comfortable but the luggage for ALL, but three, passengers was never loaded in Nairobi, (or so they told us). Though, we were traveling under the “Priority” luggage tag due to colleague’s KLM frequent flyer card, the luggage arrived the following day, with the locks broken on the suitcases and the contents ransacked. 
In terms of  Visa and eGovernment, this aspect was very impressive, even before we left for Rwanda  We applied for visas online in the morning and though the response to the submission said it would take three (3) days for the visa, we received our PDF visa documents the very same day by email  (to be printed out and carried on the flight).  The payment for this cost US$ 30 at the airport and there is a little process of approaching the immigration counter before one is sent to pay at a cashier and then return  for a stamp.

The duty free at the airport is ridiculously cheap – with cigarettes cartons US$1 cheaper than in Nairobi and the Scottish single malt, Glenmorangie, cost just US$28 as compared to $40-50 for the same bottle in Singapore, Europe and the USA!

Getting around : The first thing to note in comparison to Nairobi is there is little traffic except for rush hour in morning and evening. The roads are wide, even, and clean and it was a pleasure to drive even during evening hours.

Kigali is a small town and reminds me of Bangalore in the late 1980s before the big boom – it has pleasant weather, mountainous vistas, hillsides with homes and a slower pace filled with mopeds – such as TVS 50 and ubiquitous  “motos” = boda bodas. All drivers have helmets, with spare for riders and they are marked with numbers and names. Taxis were less commonly seen.

Where to stay:
We stayed at the Hotel Chez Lando – close enough to the airport yet it felt central to the town. We paid US$ 60 per single room which were neat, clean and comfortable. Only soap is offered in the bathrooms though and such amenities were limited. On the other hand, guests have Wi-Fi internet  access (via password) throughout this garden style hotel.

There is breakfast included in the rooms, as well as a bar and restaurant . The hotel also has pleasant walkways with the heady scent of night blooming jasmine when walking through to the guest rooms.

Note: There was a theft in my room and the front desk was reluctant to act upon it in any way. We hear that police tend to say “It must be Kenyans” if thefts occur, and this had also happened to our colleague who had her house burgled by 4 armed men who took everything of value. Rwandans will claim Kigali is safer than Nairobi, but I leave that to your judgment.

Communications: Our Safaricom connection worked but even though Airtel advertising has seen around Kigali  the prepaid Airtel one did not, – & they say that it will be arriving soon.

The top two service operators here are MTN (see everywhere, discreetly) and Tigo. We also saw  internet cafes and  one assumes most businesses and hotels have broadband as that was widely advertised through RwandaTel. Is Rwanda working towards internet access (and thus provision of eGovernment services) for all? Yes, that I would agree with based on what I heard (though MTN money from the city to rural recipients, is not yet convenient for due to shortage of agents) and saw (our visa response rates)

Dining We ate at the Hotel Chez Lando that was reasonable with beer in an open air environment, food tends towards a European menu rather than more local offerings that seem available in Kenya;  one of the many Chinese restaurants  had good food, fast service and was affordable and there was also KhanaKhazana – a premium Indian restaurant  whose food (speaking as an Indian from India) was superb, some of the best I’ve eaten and the restaurant was packed with expats from all over the world.  The service was better, in my personal estimation, than in Kenya, although our Kenyan
colleagues feel the Rwandans to be slow. There is tradeoff made there for waiters here are empathetic, courteous, and willing to help you choose and navigate the menu.

Beer: Mutzig is the highly recommended local beer and its better than a Heineken and maybe (dare I say) than  Tusker! It comes in two sizes, extra large and regular and is the preferred beer over the more plebian Primus (considered the Budweiser of Rwanda). 

Our hotel’s bar was packed with non resident diners (the front half is separated by a garden gate from the residential half) and had TV sets, a pool table and casual open air seating. On the other hand, with all its non smoking rules, and Rwanda is said to be stricter about smoking than Kenya.  However, this was not felt as a major constraint by our smoking colleague.

Shopping & Sightseeing: Not much of this happened due to our packed
work schedule but a  must-see in Rwanda is the Genocide Museum in Butare. The reverberations of this nations’ events of 1994  can still be sensed across the country (we went deep south close to the Burundi border as part of our
work, passing the Ethnographic Museum) and influences the country’s patterns of behaviour. April is the national month of mourning and the country, effectively shuts down.

Rwanda cannot be understood without understanding this national event, and even our group (on a commercial trip) could not avoid the bullet holes in our local office, or the scars – both mental and physical – as some of our colleagues, narrated their stories of survival.

Business opportunities: MTN Money has been there for three years but rural agents are not as common as the local Bank Populaire de Rwanda – which has more rural outlets than MTN Money agents per local interviews on cash flow,  although for the city dwellers, it is more convenient. There is opportunity here, as the government moves towards eGovernment and providing internet access for all, for a wide variety of services and applications on the mobile platform.

One also did not see much activity such as jua kali metalworks, fabricators etc. and the rural market’s household goods shop had only china made offerings and no local ware such as in Kenya. Only one tailor was seen on the 110 KM trip to upcountry locale. Biashara is not as obvious nor as common, and one has heard is much more regulated by local councils and regions. In Kigali, Indians were seen doing business as were the Chinese.

Biggest Surprise: Rural Rwanda barely noticed us mzungus and we did not feel we were foreigners like we had in other rural regions e.g.  in Kenya. Only in a rural market, was our Kenyan colleague teased for having a mzungu with her. Our second biggest surprise, (coming from Kenya,) was the minimal wall paintings seen  across rural Rwanda and how structured and regimented the buildings were – similar construction, similar colours and mostly natural earth walls in comparison to the bright series of walls  (with cheap corporate advertising) one sees in Kenya.

Overall, a peaceful, small, well managed nation was the impression left although one could see prisoners in their bright orange suits at work in the city as well in the rice fields in the rural areas. Prisoners do not escape when working the fields because, if they do, their families homestead will be confiscated in return by the government.

Summary: The sense was that Kagame would indeed reach his 2020 vision of becoming the Singapore of Africa, but I add the caveat of the obvious and unnecessary thefts from the hotel room as a caution.

Guide to Nampula

 A guest post by MVQ

Intro: Why Nampula? Well its, the seat of northern Mozambique as well as an agriculture hub of southern Africa linking the cashew growing east with the soy and cowpea growing western areas of Mozambique.  While the area is beautiful, there are few paved roads and thievery is rampant so be careful and you should have an enjoyable time.  If you have the time be sure to visit the gorgeous and historical Isla de Mozambique – it is an under-visited international treasure from Portuguese colonial times!

Getting there: I flew through Johannesburg to Nampula. There is a direct flight between the two cities on South African Airways.  The airport is quite small (one terminal, one baggage area, same person who checks you in, also boards your flight, etc.)  Upon landing it isn’t clear what to do. Eventually I figured out that you must (gulp) leave your passport with a customs agent at a small desk in the baggage hall, then find your way upstairs to the mini-customs office to buy a visa ($85), take a visa photo, and await processing. Luckily there are very few foreigners flying into this airport so the whole process took about 40 minutes for me and my four companions.

Getting around: There are few paved roads so 4X4 trucks are the norm.  It is best to plan a car service in advance as there isn’t reliable public transport.  Be ready to pay for a driver by the day or to rent a car for the duration of your visit. Nampula itself is quite small, but if you are heading there, you will likely end up leaving the city for sight seeing or business – and having a car and experienced driver is critical.

Communications:
You can pick up internet at most of the major hotels, though the most reliable way to access the interent is through your mobile service. You can pick up a local SIM card when you land. If you need to spend extensive time online, there are internet cafes and the Millenium Hotel has reasonably good internet in the main areas on the first floor


Hotels: I only experienced the Millenium hotel, it was I believe ~$150-200 per night and was fairly  nice for the area.  The little restaurant in the hotel serves complimentary breakfast in the morning and Indian food in the evenings. They also have a small coffee bar with sandwiches.

Summary: This is a very small hub in a country still recovering from civil war. It is only a few hours from the beautiful Isla de Mozambique, and the farmlands of Gurue. They have built up a moderately robust infrastructure and it is relatively easy to navigate. Be very careful with your belongings and whereabouts (at the market a thief opened my car door and attempted to steal my camera and iPhone–so be careful!!), but it is beautiful, the people are for the most part quite kind, and the scenery is amazing!

Note: Kenya Airways flies from Nairobi to Nampula, with direct flights on their aircraft or LAM Airline, for $1,000 and above.

My BlackBerry Life

I started using a Blackberry in 2012 courtesy of a loaner-phone from the company. It was an interesting time and I was looking to replace a Nokia E-72 and was considering a Nokia E6, and then Blackberry came along  – at a time when it seems most of the corporate and developer world sees the future as being either with Android or Apple phones. 

It’s true that both Blackberry & Nokia are on the decline in terms of sales, market share and most important in terms of coolness or the wow factor (now the domain of Samsung and Apple) but both the  former companies remain strong in certain markets of the world like China (Nokia), and Africa (Blackberry in South Africa and Nigeria) with millions of core customers who have a long history of staying loyal (mainly due to BBM).  

About the phone: The Blackberry 9860 Torch is a wonderful phone, that makes you wonder what is wrong with the company. Moving from a qwerty keyboard phone  (Nokia E-72) to a touch screen (BB 9860) phone was not the challenge I expected. In fact, it has made life better, as with a qwerty, you’re pushing the boundaries of safety and good taste e.g. tweeting while driving, walking the streets of Nairobi, or in a business meeting  (none of which are advisable).

Positives

Office Assistant: For mail, it works, very well for office mail, and multiple other accounts with which you can view attachments & documents, reply quickly or mark messages for later action. The calendar is also very easy to update and sync with the office one and a personal one for all meetings and events. You can back up contacts and messages with blackberry protect for recovery in case you lose your phone. 

BBM: What more can you say about blackberry messenger (BBM)? It cuts across phone networks & country borders for seamless chats, photo sharing, instant group chats. It’s like a super secret cult of your friends to share quick, private messages.

Camera: Billed as a 5MP camera with a 4X digital zoom, it works very well and takes excellent pictures, even at a distance.  The quality is excellent and adding to the office assistant qualities, the phone also doubles up as a fax, scanner or photocopier to snap pictures of cheques, receipts, bank statements, and other documents for instant emailing or archiving.  I’ve stopped carrying a digital camera on trips as the BB one alone is perfect to snap very good pictures. It’s also very easy to share pictures on Facebook, twitter, Bluetooth or BBM and a recent update also allowed for one to have multiple twitter accounts.

Connectivity Cost & Service: Blackberry service costs Kshs 1,000 (~$12) per month from Safaricom or Airtel for data, browsing, email and messaging. With voice calls as extra, it’s cheaper to operate a blackberry (about Kshs 1,500 per month) than any previous phones (~2000 per month) because (unlike users of Android phones) you don’t have to worry about the extensive data pulling by apps that run in the background. Also for travel to other countries, it’s been super to check ahead for a local mobile company with Blackberry and buy a local SIM  & data package (for one week or month) and stay fully connected without incurring costly roaming charges (doing without voice and SMS) 

Negatives

Battery life: The 9860 is a smart phone problem with a large screen (3.7 inches) and like, many smart phones, it’s a drain on battery life. The phone would sometimes go a half day before going flat, but since I turned off 3G and use EDGE exclusively, it’s able to get through a full day. The advertised 6 hour talk time of the phone, is often 6 hours of total battery time before having to recharge.

Apps: Waze, and Blackberry Maps work quite well for finding places and driving navigation, and are very accurate in Nairobi, Accra etc. However there are not enough apps, and few new ones being created and marketed.

No radio? This is Africa and radio is better than podcasts and song files. But at least radios features on other phones like the curve 9320/9220 models

OS 7: Too often you see the spinning clock when the phone is trying process several commands. 

Overall: It’s an Android versus Apple world, e.g today the New York Times discontinued support for its blackberry app but maybe Blackberry (and Nokia) can discover what they are missing in terms of wow, and reach out to more developers on creating new versions of their apps. 

 That’s half the equation, and on the company side, there’s been little that’s new and compelling in terms of wooing new phone buyers to choose Blackberry to be their next phone. Still, I’m hooked and can’t see myself going back. What’s next Blackberry?

10 Business Blogs in East Africa

There are quite a few business blogs in East Africa, worthy of reading. In fact, there are way more, than 10, but that’s a catchy title for the search engines. Here’s a list of some business blogs found in over 10 categories, but feel free to add more in the comments section.
Architecture/Infrastructure
Architecture Kenya  is about architecture in Kenya and tracks large projects. 
East African Energy is about energy issues.
– new  Tom Makau on telecoomunications and the Power industry
Thika Road Blog is all about Kenya’s new Highway from Nairobi to Thika. 
Ujenzi Bora is about real estate & building best practices.
Business Writers/Economists:
Quite a few journalists & writers also blog on business issues including; 
Andrea Bohnstedt is a risk analyst and column writer.
new Biz Extra’s
Terry Anne Chebet is a business anchor with CCTV Africa.
A blog by Wolfgang Fengler, the World Bank Nairobi Economist
Nairobi Tech is on corporate happenings in Kenya, mainly related to tech companies.  
Naked Chiefs is about African geo-politics and issues around big man leadership
– Niti Bhan writes on the Prepaid Economy and other unique economics circumstances of low income people. 
Wanjiku is an accomplished columnist, who focuses in ICT issues
Entrepreneurship
How we Made it in Africa celebrates and discusses entrepreneurs and companies investing in Africa.
– InspiringGreatness001 is a blog about the Kenyan entrepreneurship experience that gives practical tips on how to build  a great company.
Kenya Manual is a business guide that shows you the actual steps & processes of paying taxes and doing other things to keep a start-up or small business compliant with Kenyan laws.
Mama Mikes blogs about growing a $50,000 company to a  $500,000 one
Ratio Magazine is about risk analysis for entrepreneurs in this part of Africa risk analysis. 
Timbuktu Chronicles  is an all time favourite that chronicles homegrown entrepreneurs and their achievements, even from countries that are rarely on the news radar.
General Financial Advice: – Centsible Woman  and Centonomy are on financial advice for women. –  Coldtusker  all round blogger on economics, corporate governance, voodoo & vulture economics! 
Credit Kenya dissects the finance print in loans and other borrowing arrangements. 
Huduma Bora  is a blog about customer service issues, taxation, and other business ideas from the perspective of a motor vehicle dealer. 
– The Kenya Capital Investment Group is on banking, mortgages, diaspora issues and Kenyan political risks. 
Pesatalk is a new site that aggregates business news and articles from several young bloggers. 
Rookie Manager is on personal financial advice & portfolio growth. 
Zack Mukewa is a traveling economist & strategist.
– Other blogs on Nairobi Securities Exchange listings and offers include Contrarian InvestingFrontier Markets, and Mashilingi.
New Ashanti Research

ICT issues 

– A blog about open data.  
–  Kachwanya and Moses Kemibaro blog about new products, ICT happenings and local tech events in the region.
– Two blogs on intellectual property issues are IP Kenya and Afro-IP.  
White African  is a Senior TED Fellow who writes about the big ICT picture and small locally-grown innovations (Afrigadgets)
Mobile Money blogs
– Read the Frontlinesms credit blog about extending financial services to under-served communities.
– The team at Kopo Kopo blog about extending the functionality of mobile money. 
–  Think M-pesa is all about M-Pesa, the mobile money platform popularized by Safaricom
Politics & Business: There’s Mzalendo which tracks Kenya’s parliament including new bills that it is discussing,  Mars Group Kenya which has several blogs and reports on the economic impact of corruption in Kenya and Kenyan Jurist looks at reforms in the court system which will have an impact on business dispute resolution. 
Tourism: Wolfgang Thome writes extensively about tourism developments in East Africa. Two other blogs are Murugi Njehia who reviews local tourism destinations and Njooro who’s DianiLife should be the starting point for all visitors to Kenya’s world famous Diani Beach.
Regional & around Africa 
– Amid the writing on opposition politics Ethiopia Review also has several write ups on agriculture, infrastructure and other developments in Ethiopia.
–  Linda Ikeji is a top Nigerian blogger and socialite who also writes a fair amount of stuff on aviation, infrastructure and other business happenings. 
Imod.co.za is the one business & tech blog from South Africa to be followed.
– South Sudan is Africa’s newest country, and Lorry Boys is a blog about a company that deals in specialized vehicles that are suited to the harsh terrain and infrastructure. 
Issa Michuzi  is Tanzania’s top blog. Written in Swahili, it’s astounding to see the amount of corporate advertising on a Tanzania blog. 
Zambian Economist writes about the country’s economy and notably on the financial drain of taxpayer funds. 
–  Zimbabwe Absurdity bills itself as life and viewpoints from the world’s 2nd worst economy. 
Social Media & branding:  There’s Mark my Words, Marketing medicine for Africa and the team blog from Squad Digital.

Real Estate Moment: Ghana Cities, Old Taxes, & Pricey Mortgages

Ghana Cities: Last weekend, in Accra, the Renaissance Group launched two new cities that they plan to represent the future of urbanization in Ghana. The cities will be mixed-use areas where residents will live work and play and are in the same vein as Tatu City that was launched in Kenya, but which has been embroiled in a shareholder court case that has affected the pace of the project. The concept of new cities that Renaissance is planning in Ghana, Kenya (Tatu on 2500 acres for  70,000 people),  Zambia (Roma park) and the Democratic Republic of Congo (Kiswishi on 6900 acres in Lubumbashi to break ground in 2012) are based on some harsh realities:

  • That African cities are fast-growing (there are now 52 cities with over 1 million people), attracting rural migrants in search of employment and opportunity.
  • There is a shortage of housing that is quality or decent, and many city developments are unplanned.
  • Also, the infrastructure in many of these cities is lagging  and authorities will not be able to supply the services or utilities that residents need to have, while residents are facing ever-longer commutes.

The two Ghanaian cities are King City (located 10km from Takoradi harbour in North Akase area) which will be built over 10 years in phases to house 90,000 people and Appolonia (located 30km from Accra and 20km from Tema Harbour) which will have retail and commercial developments on 2000 acres to house 88,000 people. Appolonia which is now having water & road development will break ground in 2013.

With both cities, local communities are investing their land in the deal. They are not selling, and remain as equity partners with a stake to get a return on their undeveloped land and create employment for the youth and Renaissance team estimates that Accra itself will need another 5 – 6 cities to absorb its fast growth. Both the cities will have high, medium, and low-cost housing units and as the local mortgage continues to develop, the Renaissance team expect that most people should be able to afford homes. Ghana now has mid-market mortgages accessible over 10 years for about 80,000 Cedi’s (~$40,000 or Kshs 3.3 million).

Other mega real estate developments, blogs & articles

Tips: Nahinga blogs about three real estate investing lessons from the Accra Mall project, that began in the early 1970’s namely

  • (Speculate)/purchase real estate in the direction that a City can grow towards.
  • Use professionals and maintain a high standard of quality.
  • Have an exit strategy

Garden City: The real estate sector in Nairobi is attracting more PE interest, and Actis’ portfolio includes ten institutional quality assets in seven countries in sub-Saharan Africa. Following in that model, equity firm Actis and partners including Game are to develop Garden City  which will include homes, an events arena, and the largest retail mall in East Africa. It has already attracted MassMart from South Africa and it will break ground in December 2012. 

Other Mega project opportunities:

Railway prime real estate: The Kenya Railways Corporation plans to develop 385 acres of prime real estate land in Nairobi, Mombasa and Kisumu, and is seeking investors to build hotels, residential housing, light industries and shopping malls.

Kisumu Floatel: A project is seeking investors to establish a luxury passenger vessel as a 5-star floating hotel on Lake Victoria that will accommodate 80 passengers.

Cautionary Tale: But sometimes mega projects can go wrong like this ghost city built by Chinese investors in Kilamba, Angola.

Taxation Time: The Kenya Revenue Authority has published some recent notices about taxation of rental income and other income from real estate. While collection of value-added tax (VAT of 16%) has been observed in the commercial building sector, some residential owners have ignored that, while others have not been aware that they are also supposed to pay income tax that graduates from 10% on net rental income of up to ~122,000  to 30% on all rental income over ~Kshs. 466,000 ($5,600). There is also “other” treatment for non-residents, partnerships, estates of deceased landlords and Kenyans living in the diaspora, as well as tax incentives available for rental income on real estate investment trusts (REITs)  and on low-income housing projects (less than $20,000).

Nairobi Real Estate Price Index: Hass Consult have just released their second-quarter report on housing price trends.  They applauded the recent lowering of the Central Bank CBR rate (to 16.5%) as they noted that the impact of high-interest rates will continue to be seen in a slow down in new building amid the high finance costs. They also noted that, while the pace of building in Nairobi is at a peak, it’s still a fraction of the housing demand, and while projects are coming to fruition, new ones are not being started as people who would be buying homes are instead staying in rental properties longer. The release of the report was sponsored by The Mortgage Company, a mortgage brokerage firm who also released a mortgage rate sheet for consumer comparison and which showed I&M bank had the lowest mortgage rates of 18%, while Equity, CBA and Family Banks had the most expensive at 24%.
 

Mortgage Chat: The Kenya Bankers Association which is turning 50 this year, just re-branded and launched a new outlook and new website. One of their new outreach programs will be a weekly mychat session with a bank CEO, and in a few weeks, they will feature Frank Ireri, the Managing Director of Housing Finance bank, who will chat about mortgages.TV Time: Finally, there will be a new TV show coming to NTV in Kenya that will be devoted to real estate and will air on Sunday afternoons in a few weeks.