Last year, the Eastern Province Private Sector Federation (PSF) promised to introduce investment initiatives in the province’s seven districts.
The undertakings are contained in the federation’s performance agreement with the government.
Recently, however, the business community’s umbrella arm realized that its members were unwilling to participate in the projects, forcing the federation to step up attempts to mobilize funds.
In each district, PSF identified multiple investment projects ranging from Rwf1 billion to Rwf3 billion.
The full investment outlay was estimated at over Rwf20 billion for all districts in the eastern province, but the failure to raise the necessary funds has postponed the project execution.
The private sector promised to invest in commercial building in the districts of Bugesera, Kayonza and Ngoma.
They planned to invest in a hotel in Kirehe, a modern market for Rwamagana, a modern taxi-park for Gatsibo and a maize processing plant for Nyagatare.
However, the PSF Chairman in Kirehe District, Augustin Mutabazi, said they were short of Rwf1.2 billion required to build a hotel.
“We realised that our district was lacking a hotel, which made it impossible to host provincial or any other top level meetings,” he said.
Thus, as the owner of the project, private sector operators grouped in the district under PSF established Migongo Investment Group.
Each share cost Rwf300,000 with 4,000 shares accessible in the company.
Although 2,800 shares were booked, possibly translating into Rwf840 million, Mutabazi said the company had in the bank only Rwf15 million.
Mutabazi asserted that the shortfall is because the private sector does not fully comprehend the authority of working together, particularly given that some of them grouped in cooperatives have made losses in the latest past.
However, PSF participants in Bugesera are close to raising Rwf1 billion investment capital they need to build a commercial building.
Eugene Higiro, the district’s chairperson of PSF, the shareholders have already paid for a third of the shares and are on track to purchase the remaining shares.
They have applied for a bank loan to accelerate the execution of their project, he revealed.
“We have no excuse for not having a complete building within two or three months ahead,” Higiro stated.
The PSF Chairperson in the Eastern Province, Jean Bosco Ndungutse, urged members to adopt the concept of joint ventures.
“The more we work together, the further we go,” he said.
Robert Bapfakulera, the Chairman of PSF at national level said that the federation’s idea is to create management teams at district level to oversee the execution of the projects and mobilise resources.”
For Bapfakulera, the slow participation of the federation’s members in certain projects does not necessarily reflect the lack of partnership spirit.
“Businesspersons, as you know, target profits in what they invest in, and they do it when they understand how they will benefit,” he explained.
The PSF leaders will have to redo the business plans of the projects in order to attract investors, he said.
The governor of the Eastern Province Governor, Fred Mufulukye, said; “These projects did not run as fast as we wanted.”
But still, he added, although we have not moved as fast, we have not quit, we should celebrate that too.