Why Chinese Engineering Companies Sign Rwanda’s Big Cheques

Rwanda Utilities Regulation Authority(RURA) headquarters under construction

You have seen several big projects all over Rwanda’s capital Kigali. The city is growing so fast – from smallest structures to the tallest – to the widest. Kigali is showing progress.

Driving around Kigali streets, new roads are coming up. Tarmac roads. Outside the capital, roads and bigger infrastructure projects are taking shape. No wonder, the country’s huge budget has been dedicated to infrastructural development – a case of the recently announced 2019-2020 budget.

According to the 2019/2020’s Rwf2.8 trillion budget, Infrastructure leads the country’s list of top six expenditure priorities – with a colossal Rwf551, 1 billion ($600 million) allocated to the sector.

This is the amount that will fund several projects including buildings, roads and many others.

But are Rwandans – the taxpayers who raise these funds for these projects take share on the amount dispatched to infrastructure projects? The answer could almost be no, or closer to that, especially when you ask owners of local engineering firms and engineers in general.

Zigama CSS headquarters at finishing phase

This is because, they say, the Chinese flags are cordoning many big projects coming up within and outside Kigali. The list is long. But, most agree, the Chinese have the required muscle to overpower them, in many aspects.

To make a quick survey on how Chinese companies cover up many huge project in the country, on Tuesday, October 23, 2019, KT Press toured Nyarugenge district Hospital which is under construction.

Amid sounds of heavy machinery at the 126-beds facility – set to ease Rwanda’s burden to handle health issues, engineers from China Civil Engineering Construction Corporation (CCECC) were all over the site, pushing local workers to do the job in different sections of the hospital that is set to be unveiled before end of this year, according to Nyarugenge district officials.

The Chinese company, established in 1979 under the approval of state council of the People’s Republic of China, is one of the most bidders of huge tenders in Rwanda.

Its flags hang at different roads and buildings under construction within and outside Kigali.

Apart from the Rwf6 billion Nyarugenge district hospital, CCECC is the brain behind Kigali City Tower – Kigali’s tallest building so far.

Other Chinese companies taking huge contracts in Rwanda include the Beijing Construction Engineering Group (BCEG) – a company that was initially contracted to undertake construction of the Kigali Convention Center, China Road and Bridge Corporation and China Star Construction Co. Ltd, among others.

The companies, according to members of the Rwanda Association of Engineers, have taken over taxpayers’ money by ‘smartly’ winning huge tenders – leaving local companies for the least they can afford.

According to local engineers, one of the reasons favouring Chinese companies to win big tenders is that they are older than local companiee, but, they also claim they can compete and win such big tenders, only if equal opportunities are given ro them

“You see Rwandan local engineering companies can’t compete with Chinese. This is hugely because of two reasons; one, our financial muscle is weak compared to the Chinese. They also (Chinese companies) have long experience in the field which favours them,” an engineer at the Nyarugenge Hospital construction site told KT Press.

“Rwandan engineering companies can only afford joint-ventures with the Chinese,” the Engineer added.

Indeed, at the Rwf6 billion-valued Nyarugenge facility, CCECC won the tender to construct it through a joint venture with Horizon – a local engineering company.

“But very few local companies can even afford this joint venture,” the engineer at the site told KT Press.

Biting interest rate on loans

To narrow down what could be ruining chances of local engineering companies to take up big tenders, KT Press spoke to Fred Rwihinda – a member of the Rwanda Association of Engineers in charge of Compliance and Inspection at the Association.

According to Rwihinda, two big challenges face local engineering industry; lack or less efforts by the Private sector to help them acquire necessary support to win such tenders, and Financial Institutions that place high interest rates on loans.

“How can you compete with a Chinese company bidding with an assurance of a loan that comes with a 3% interest rate from its home bank when your bank wants an interest rate ranging between 18-20%?” Rwihinda told KT Press.

According to Rwihinda, local engineering firms have the capacity to win and execute big contracts.

“We have the capacity, but maybe government should provide incentives to enable us acquire loans with ease,” Rwihinda said.

Are Banks unable to fund big projects?

The inability to fund bigger projects by Rwanda’s financial institutions, is what many local engineers voiced out when speaking to KT Press.

However, in some instances, Bankers believe that some of the big projects can be locally financed, while others may even require “syndicated loans” as termed by Maurice Toroitich – Chief Executive Officer of BPR-Atlas – one of the biggest financial institutions in the country.

RURA building under construction

According to Toroitich, depending on the size of the project, there will be certain projects that require financing that local banks will not be able to do on their own and this is because of the size of the balance sheet.

“Remember, there are rules around how a bank makes money. The most important rule is that banks should not lend money to a customer or one group of related companies more than 25 percent of its capital. So depending on the capital size of the bank, 25% may not be able to finance the loan – say for example may not be able to fund the airport or our next Airbus A330,”

“There will be projects whose financing cost is much bigger than what an individual bank can finance,” Toroitich told KT Press.

He, however adds that given that limitation, “banks usually come together all and this is where you have syndicated loans where by every bank brings to the table money according to their own individual capability to finance this project,” he said.

But still, some needed capital cannot be raised by the combined banks.

“Sometimes also even after combining, some projects are still bigger than the banks. That is why governments borrow money from IMF (International Monetary Fund), IFC (International Finance Corporation) and others. They can provide larger amount of credit so that is one part.

The second part, it is not about interest rates or the size of the loan, but it could also be about other conditions. For some development institutions especially the financing institutions like ADB (African Development Bank) can be able to provide very long-term loans…25, 30 or even 50-year loan which commercial banks cannot do. Remember we are commercial banks,” said Toroitich.

Maurice Toroitich, CEO BPR/Atlas Mara

According to Toroitich, “Commercial banks means day-to-day trade. So when it comes to very long-term projects, we don’t have the type of resources to support that, which is why China Road and Bridge Corporation will go to China and try to get a 30-year-loan from China Exim Bank to finance a big road construction.”

Competitive market

One of the things Rwandan engineering firms have been reminded by Toroitich, is that despite Chinese firms taking all big tenders, they should remember that Rwanda runs a competitive market economy.

“But I also think that it is a competitive market. Sometimes there are projects which can be financed locally but it depends on how bigger and competitive the bidder is and the quality of the project, financing around and the readiness,”

“Let’s say it like this; if today there was a contract out there and one contractor says I am ready to start tomorrow because I have my machinery, I have engineers, I have the finance and another one will say look I think I will start next year because I have to look for financing, I have to hire machinery…all those kind of things and the client wants the job done as soon as possible. I call these commercial realities of these kind of projects.”

Kagame on China

At the September 2018 Forum on China-Africa Cooperation (FOCAC) in Beijing, President Paul Kagame lauded the Chinese aid and investment strategy in Africa as a source of “deep transformation”.

Kagame argued that the cooperation between China and Africa is based on mutual respect and is for the benefit of both partners. This sentiment is perhaps shared by most African heads of states.




Leave a Comment

adana escort adapazarı escort adıyaman escort afşin escort afyon escort ağrı escort ahlat escort akçaabat escort akçakale escort akçakoca escort akdeniz escort akhisar escort aksaray escort akşehir escort aksu escort akyazı escort alanya escort alaşehir escort aliağa escort altıeylül escort altınordu escort amasya escort anamur escort ankara escort antakya escort antalya escort araklı escort ardahan escort ardeşen escort arnavutköy escort atakum escort avanos escort avcılar escort aydın escort ayvacık escort ayvalık escort aziziye escort babaeski escort bafra escort bağcılar escort bağlar escort balıkesir escort bandırma escort bartın escort batıkent escort batman escort battalgazi escort bayburt escort belek escort besni escort beylikdüzü escort beyşehir escort biga escort bilecik escort bingöl escort birecik escort bismil escort bitlis escort bodrum escort bolu escort bor escort bornova escort boyabat escort bozüyük escort buca escort bucak escort bulancak escort bulanık escort bünyan escort burdur escort bursa escort çan escort çanakkale escort canik escort çankaya escort çankırı escort çarşamba escort çayeli escort çekmeköy escort çerkeş escort çerkezköy escort çeşme escort ceyhan escort çivril escort çorlu escort çorum escort çubuk escort çukurova escort çumra escort dalaman escort darıca escort datça escort davutlar escort defne escort denizli escort derince escort develi escort didim escort digor escort dinar escort diyadin escort diyarbakır escort doğanşehir escort doğubayazıt escort dörtyol escort dulkadiroğlu escort düzce escort edirne escort edremit escort efeler escort elazığ escort elbistan escort emirdağ escort erbaa escort erdemli escort ereğli escort erenler escort ergani escort ergene escort erzincan escort erzurum escort escort esenler escort eskil escort eskişehir escort espiye escort eyyübiye escort fatih escort fatsa escort fethiye escort finike escort fındıklı escort gaziantep escort gaziemir escort gebze escort gediz escort gelibolu escort gemerek escort gemlik escort gerede escort giresun escort gölbaşı escort gölcük escort görele escort görükle escort göynük escort gümbet escort gümüşhane escort güngören escort güroymak escort gürsu escort hakkari escort haliliye escort hatay escort haymana escort horasan escort iğdır escort ilgaz escort i̇lkadım escort i̇negöl escort i̇skenderun escort isparta escort i̇stanbul escort i̇zmir escort i̇zmit escort i̇znik escort kadirli escort kadıköy escort kağıthane escort kağızman escort kahta escort kaman escort kangal escort kapaklı escort karabük escort karacabey escort karahayıt escort karaköprü escort karaman escort karatay escort karesi escort kars escort karşıyaka escort kartal escort kaş escort kastamonu escort kaynaşlı escort kayseri escort keçiören escort kemer escort kepez escort keşan escort keskin escort kestel escort kilis escort kırıkhan escort kırıkkale escort kırkağaç escort kırklareli escort kırşehir escort kızıltepe escort kocaeli escort kocasinan escort konak escort konya escort konyaaltı escort körfez escort korkuteli escort köyceğiz escort kozan escort kumluca escort kumru escort kuşadası escort kütahya escort lara escort lüleburgaz escort malatya escort malazgirt escort malkara escort maltepe escort mamak escort manavgat escort manisa escort maraş escort mardin escort marmaris escort melikgazi escort menemen escort menteşe escort meram escort mersin escort merzifon escort mezitli escort milas escort mucur escort mudanya escort mudurnu escort muğla escort muratpaşa escort muş escort mut escort nazilli escort nevşehir escort niğde escort niksar escort nilüfer escort nizip escort nurdağı escort ödemiş escort of escort oltu escort onikişubat escort ordu escort orhangazi escort ortahisar escort ortaköy escort osmancık escort osmangazi escort osmaniye escort palandöken escort pamukkale escort pamukova escort patnos escort payas escort pazar escort pazarcık escort pendik escort polatlı escort rize escort safranbolu escort şahinbey escort sakarya escort salihli escort samandağ escort samsun escort sandıklı escort şanlıurfa escort sapanca escort sarıçam escort sarıkamış escort sarıyer escort şarkışla escort şehitkamil escort selçuklu escort selim escort serdivan escort serik escort seyhan escort siirt escort silifke escort simav escort sincan escort sinop escort şişli escort sivas escort siverek escort şırnak escort söğüt escort söke escort soma escort sultangazi escort suluova escort sungurlu escort sur escort suruç escort suşehri escort susurluk escort talas escort tarsus escort taşova escort tavşanlı escort tekirdağ escort terme escort tire escort tirebolu escort tokat escort torbalı escort toroslar escort trabzon escort turgutlu escort turhal escort türkoğlu escort tuzla escort ulus escort ümraniye escort ünye escort ürgüp escort urla escort uşak escort üsküdar escort üzümlü escort van escort varto escort viranşehir escort yahşihan escort yahyalı escort yakutiye escort yalova escort yatağan escort yenişehir escort yeşilyurt escort yıldırım escort yıldızeli escort yomra escort yozgat escort yunusemre escort yüreğir escort zara escort zeytinburnu escort zile escort zonguldak escort Aydın escort muğla escort tekirdağ escort manisa escort balıkesir escort manavgat escort alanya escort fethiye escort didim escort trabzon escort elazığ escort ordu escort kütahya escort ısparta escort rize escort maraş escort yalova escort giresun escort yozgat escort tokat escort şanlıurfa escort sivas escort batman escort erzurum escort sinop escort kırşehir escort karaman escort kırıkkale escort bolu escort amasya escort niğde escort uşak escort edirne escort çorum escort osmaniye escort zonguldak escort van escort erzincan escort söke escort nazilli escort kuşadası escort efeler escort didim escort çine escort bodrum escort fethiye escort marmaris escort dalaman escort menteşe escort milas escort ortaca escort seydikemer escort çerkezköy escort çorlu escort ergene escort kapaklı escort malkara escort süleymanpaşa escort akhisar escort alaşehir escort salihli escort şehzadeler escort soma escort turgutlu escort yunusemre escort bandırma escort altıeylül escort ayvalık escort bigadiç escort burhaniye escort gönen escort karesi escort susurluk escort ayvacık escort biga escort çan escort gelibolu escort yenice escort akçaabat escort araklı escort of escort ortahisar escort yomra escort karakoçan escort kovancılar escort altınordu escort fatsa escort perşembe escort ünye escort tavşanlı escort simav escort domaniç escort eğirdir escort yalvaç escort ardeşen escort cayeli escort fındıklı escort pazar escort afşin escort dulkadiroğlu escort Elbistan escort onikişubat escort pazarcık escort türkoğlu escort altınova escort çiftlikköy escort çınarcık escort bulancak escort espiye escort eynesil escort görele escort piraziz escort tirebolu escort yağlıdere escort sorgun escort sarıkaya escort çayıralan escort boğazlıyan escort akdağmadeni escort erbaa escort niksar escort turhal escort zile escort viranşehir escort suruç escort siverek escort karaköprü escort haliliye escort eyyübiye escort akçakale escort zara escort Yıldızeli escort suşehri escort şarkışla escort gemerek escort kozluk escort sason escort aziziye escort horasan escort oltu escort palandöken escort yakutiye escort ayancık escort boyabat escort gerze escort kaman escort mucur escort ermenek escort sarıveliler escort keskin escort yahşihan escort gerede escort göynük escort mengen escort mudurnu escort göynücek escort gümüşhacıköy escort merzifon escort suluova escort taşova escort bor escort çamardı escort ulukışla escort banaz escort eşme escort sivaslı escort havsa escort ipsala escort keşan escort osmancık escort sungurlu escort bahçe escort hasanbeyli escort kadirli escort toprakkale escort alaplı escort çaycuma escort ereğli escort kilimli escort başkale escort ipekyolu escort özalp escort tuşba escort kemah escort refahiye escort tercan escort üzümlü escort http://www.ddtshanghaiescort.com Antalya escort Bursa escort Mersin escort Aydın escort Balıkesir escort Çanakkale escort Kıbrıs escort Kütahya escort Manisa escort Muğla escort Tekirdağ escort Trabzon escort Yalova escort Isparta escort Maraş escort Ordu escort Rize escort Sivas escort Afyon escort Aksaray escort Giresun escort Şanlıurfa escort Yozgat escort Erzurum escort Amasya escort Çorum escort Tokat escort Uşak escort Van escort Bolu escort Burdur escort Kırşehir escort Niğde escort Osmaniye escort Zonguldak escort Düzce escort Edirne escort Erzincan escort Karabük escort Karaman escort Kastamonu escort Kırıkkale escort Kırklareli escort manavgat escort alanya escort belek escort aksu escort finike escort gazipaşa escort güllük escort kaş escort kemer escort kepez escort konyaaltı escort korkuteli escort kumluca escort lara escort muratpaşa escort serik escort gemlik escort gürsu escort inegöl escort iznik escort mudanya escort nilüfer escort orhangazi escort osmangazi escort yıldırım escort kuşadası escort didim escort nazilli escort söke escort efeler escort bandırma escort altıeylül escort edremit escort karesi escort susurluk escort bodrum escort gümbet escort turgutreis escort dalaman escort fethiye escort köyceğiz escort marmaris escort çerkezköy escort çorlu escort kapaklı escort süleymanpaşa escort meram escort anamur escort erdemli escort mezitli escort silifke escort tarsus escort akhisar escort salihli escort soma escort turgutlu escort girne escort lefkoşa escort biga escort çan escort gelibolu escort dinar escort emirdağ escort sandıklı escort merzifon escort suluova escort taşova escort yeşilyurt escort gerede escort mengen escort bucak escort kadirli escort osmancık escort sungurlu escort akçakoca escort ipsala escort keşan escort kilimli escort üzümlü escort aziziye escort palandöken escort yakutiye escort bulancak escort espiye escort tirebolu escort safranbolu escort lüleburgaz escort gediz escort simav escort tavşanlı escort elbistan escort fatsa escort ünye escort ardeşen escort çayeli escort birecik escort eyyübiye escort haliliye escort siverek escort suruç escort viranşehir escort kangal escort şarkışla escort suşehri escort yıldızeli escort erbaa escort niksar escort turhal escort akçaabat escort araklı escort of escort ortahisar escort sorgun escort www.elmasajeinfantil.com istanbul masaj salonu ankara masaj salonu izmir masaj salonu bursa masaj salonu antalya masaj salonu adana masaj salonu konya masaj salonu şanlıurfa masaj salonu gaziantep masaj salonu kocaeli masaj salonu mersin masaj salonu diyarbakır masaj salonu hatay masaj salonu manisa masaj salonu kayseri masaj salonu samsun masaj salonu balıkesir masaj salonu maraş masaj salonu van masaj salonu aydın masaj salonu tekirdağ masaj salonu sakarya masaj salonu denizli masaj salonu muğla masaj salonu bağcılar masaj salonu bahçelievler masaj salonu esenler masaj salonu esenyurt masaj salonu kadıköy masaj salonu kağıthane masaj salonu kartal masaj salonu küçükçekmece masaj salonu maltepe masaj salonu pendik masaj salonu sultangazi masaj salonu ümraniye masaj salonu üsküdar masaj salonu aliağa masaj salonu alsancak masaj salonu bayraklı masaj salonu bornova masaj salonu buca masaj salonu çeşme masaj salonu çiğli masaj salonu gaziemir masaj salonu karşıyaka masaj salonu konak masaj salonu menemen masaj salonu ödemiş masaj salonu torbalı masaj salonu çankaya masaj salonu keçiören masaj salonu mamak masaj salonu polatlı masaj salonu sincan masaj salonu alanya masaj salonu belek masaj salonu kaş masaj salonu kemer masaj salonu korkuteli masaj salonu lara masaj salonu manavgat masaj salonu serik masaj salonu side masaj salonu didim masaj salonu efeler masaj salonu kuşadası masaj salonu nazilli masaj salonu altıeylül masaj salonu bandırma masaj salonu edremit masaj salonu karesi masaj salonu susurluk masaj salonu gemlik masaj salonu gürsu masaj salonu inegöl masaj salonu mudanya masaj salonu nilüfer masaj salonu osmangazi masaj salonu yıldırım masaj salonu biga masaj salonu çan masaj salonu gelibolu masaj salonu adıyaman masaj salonu afyon masaj salonu ağrı masaj salonu aksaray masaj salonu amasya masaj salonu ardahan masaj salonu artvin masaj salonu bartın masaj salonu batman masaj salonu bayburt masaj salonu bilecik masaj salonu bingöl masaj salonu bitlis masaj salonu bolu masaj salonu burdur masaj salonu çanakkale masaj salonu çankırı masaj salonu çorum masaj salonu düzce masaj salonu edirne masaj salonu elazığ masaj salonu erzincan masaj salonu erzurum masaj salonu eskişehir masaj salonu giresun masaj salonu gümüşhane masaj salonu ığdır masaj salonu ısparta masaj salonu karabük masaj salonu karaman masaj salonu kastamonu masaj salonu kilis masaj salonu kırıkkale masaj salonu kırklareli masaj salonu kırşehir masaj salonu uşak masaj salonu kütahya masaj salonu malatya masaj salonu mardin masaj salonu nevşehir masaj salonu niğde masaj salonu ordu masaj salonu trabzon masaj salonu osmaniye masaj salonu rize masaj salonu siirt masaj salonu sinop masaj salonu sivas masaj salonu tokat masaj salonu karahayıt masaj salonu pamukkale masaj salonu nizip masaj salonu şahinbey masaj salonu şehitkamil masaj salonu antakya masaj salonu defne masaj salonu iskenderun masaj salonu darıca masaj salonu gebze masaj salonu gölcük masaj salonu izmit masaj salonu körfez masaj salonu akşehir masaj salonu beyşehir masaj salonu ereğli masaj salonu karatay masaj salonu meram masaj salonu selçuklu masaj salonu akhisar masaj salonu alaşehir masaj salonu soma masaj salonu turgutlu masaj salonu akdeniz masaj salonu anamur masaj salonu erdemli masaj salonu mezitli masaj salonu silifke masaj salonu tarsus masaj salonu toroslar masaj salonu yenişehir masaj salonu bodrum masaj salonu dalaman masaj salonu fethiye masaj salonu köyceğiz masaj salonu marmaris masaj salonu menteşe masaj salonu milas masaj salonu adapazarı masaj salonu serdivan masaj salonu atakum masaj salonu çarşamba masaj salonu ilkadım masaj salonu eyyübiye masaj salonu siverek masaj salonu viranşehir masaj salonu çerkezköy masaj salonu çorlu masaj salonu erbaa masaj salonu