Developmental patrimonialism? The case of Rwanda

African Affairs

Volumn 111, Issue 444, 2012, Pages 379-403

  Booth, David ^a   Golooba Mutebi, Frederick ^b  

^a OVERSEAS DEVELOPMENT INSTITUTE   (United Kingdom)

^b APPP   (Uganda)

Author keywords

[No Author keywords available]

Indexed keywords

INVESTMENT; POLITICAL ECONOMY; POLITICS; PRIVATE SECTOR;

ASIA; RWANDA;

EID: 84864402145     PISSN: 00019909     EISSN: 14682621     Source Type: Journal    
DOI: 10.1093/afraf/ads026     Document Type: Article

References (118)

1. For example, Phil Clark and Zachary D. Kaufman (eds), After Genocide: Transitional justice, post-conflict reconstruction and reconciliation in Rwanda and beyond (Hurst, London, 2008).
2. Scott Straus and Lars Waldorf (eds), Remaking Rwanda: State building and human rights after mass violence (University of Wisconsin Press, Madison, WI, 2011), Part III.
3. An Ansoms, 'Striving for growth, bypassing the poor: a critical review of Rwanda's rural sector policies', Journal of Modern African Studies 46, 1 (2008), pp. 1-32.
4. An Ansoms, 'Re-engineering rural society: the visions and ambitions of the Rwandan elite', African Affairs 108, 431 (2009), pp. 289-309.
5. Straus and Waldorf, Remaking Rwanda, Part IV.
6. An Ansoms and Stefaan Marysse (eds.), Natural Resources and Local Livelihoods in the Great Lakes Region of Africa: A political economy perspective (Palgrave Macmillan, Basingstoke, 2011).
7. Bert Ingelaere, 'Peasants, power and ethnicity: a bottom-up perspective on Rwanda's political transition', African Affairs 109, 435 (2010), pp. 273-92.
8. Marie-Eve Desrosiers and Susan Thompson, 'Rhetorical legacies of leadership: projections of "benevolent leadership" in pre- and post-genocide Rwanda', Journal of Modern African Studies 49, 3 (2011), pp. 429-53.
9. Johan Pottier, Re-Imagining Rwanda: Conflict, survival and disinformation in the late twentieth century (Cambridge University Press, Cambridge, 2002).
10. Filip Reyntjens, 'Constructing the truth, dealing with dissent, domesticating the world: governance in post-genocide Rwanda', African Affairs 110, 438 (2011).
11. Bert Ingelaere, 'Do we understand life after genocide? Center and periphery in the construction of knowledge in postgenocide Rwanda', African Studies Review 53, 1 (2010), pp. 41-59.
12. Straus and Waldorf, Remaking, Part V.
13. Danielle Beswick, 'Managing dissent in a post-genocide environment: the challenge of political space in Rwanda', Development and Change 41, 2 (2010), pp. 225-51.
14. Paul Gready, '"You're either with us or against us": civil society and policy making in post-genocide Rwanda', African Affairs 109, 437 (2010), pp. 637-57.
15. Andrea Purdeková, '"Even if I am not here, there are so many eyes": surveillance and state reach in Rwanda', Journal of Modern African Studies 49, 3 (2011), pp. 475-97.
16. Straus and Waldorf, Remaking, Part I.
17. Gérard Prunier, From Genocide to Continental War: The 'Congolese' conflict and the crisis of contemporary Africa (Hurst, London, 2009).
18. Filip Reyntjens, The Great African War: Congo and regional geopolitics, 1996-2006 (Cambridge University Press, Cambridge, 2009).
19. The term, used by James C. Scott in connection with the excesses of state dirigisme in the Soviet Union, Tanzania, and elsewhere, is popular with several contributors to Straus and Waldorf, Remaking. However, Scott is unusual among those who work on the role of the state in development in his lack of concern about how, in many countries, development challenges have been overcome with the help of effective state agencies. See James C. Scott, Seeing Like a State: How certain schemes to improve the human condition have failed (Yale University Press, New Haven, CT, 1998).
20. (19 April 2012).
21. That is, structural change resulting from widespread productivity gains and not just accelerated growth, following, among others, K. Y. Amoako, 'Transforming Africa - start now, we can't wait', African Business 45, 377 (2011), pp. 24-7.
22. UN Economic Commission for Africa/African Union, Economic Report on Africa 2011: Governing development in Africa - the role of the state in economic transformation (UNECA, Addis Ababa, 2011).
23. Tim Kelsall, 'Rethinking the relationship between neo-patrimonialism and economic development in Africa', IDS Bulletin 42, 2 (2011), pp. 76-87.
24. Tim Kelsall and David Booth, with Diana Cammack and Frederick Golooba-Mutebi, 'Developmental patrimonialism? Questioning the orthodoxy on political governance and economic progress in Africa' (Working Paper 9, Africa Power and Politics Programme, London, 2010).
25. Diana Cammack and Tim Kelsall, 'Developmental patrimonialism? The case of Malawi' (Working Paper 12, Africa Power and Politics Programme, London, 2010).
26. Mushtaq H. Khan and Jomo K. Sundaram (eds), Rents, Rent-Seeking and Economic Development: Theory and evidence from Asia (Cambridge University Press, Cambridge, 2000).
27. Mushtaq H. Khan, 'Governance and growth: history, ideology, and methods of proof' in Akbar Norman, Kwesi Botchwey, Howard Stein, and Joseph E. Stiglitz (eds.), Good Growth and Governance in Africa (Oxford University Press, Oxford, 2012).
28. See the literature on transformation cited above as well as Justin Lin and Célestin Monga, 'Growth identification and facilitation: the role of the state in the dynamics of structural change', Development Policy Review 29, 3 (2011).
29. Lindsay Whitfield, 'How countries become rich and reduce poverty: a review of heterodox explanations of economic development' (Working Paper 2011: 13, Danish Institute of International Studies, Copenhagen, 2011).
30. Douglass C. North, John J. Wallis, and Barry R. Weingast, Violence and Social Orders: A conceptual framework for interpreting recorded human history (Cambridge University Press, Cambridge, 2009).
31. Khan and Sundaram, Rents, Chapter 1.
32. Kelsall, 'Rethinking'.
33. Michael Bratton and Nicolas van de Walle, Democratic Experiments in Africa: Regime transitions in comparative perspective (Cambridge University Press, Cambridge, 1997), pp. 61-96. The prefix 'neo' indicates a system which combines patrimonial and legal-rational or modern bureaucratic features. In discussing the more developmental subtype, we drop the prefix solely for economy of expression.
34. For comparable work on Ethiopia, see Sarah Vaughan and Mesfin Gebremichael, 'Rethinking business and politics in Ethiopia: the role of EFFORT, the Endowment Fund for the Rehabilitation of Tigray' (Research Report 02, Africa Power and Politics Programme, London, 2011).
35. Interviewees included government and RPF officials (22); directors and managers of CVL, Horizon Group, RIG, and parastatal companies (18); other business leaders and staff (26); NGO heads, consultants, and journalists (19); and donor agency advisers (6).
36. National Institute of Statistics of Rwanda, 'Gross domestic product and its structure by activity' (NISR, Kigali, March 2011), Table 2A.
37. Yusuf Murangwa, 'EDPRS2, EICV3 and DHS4 joint launch: key statistics highlights' (National Institute of Statistics of Rwanda, Kigali, 7 February 2012); Republic of Rwanda, Rwanda Demographic and Health Survey 2010: Final report (NISR/Ministry of Health/ICF International, Kigali, December 2011. See (14 February 2012).
38. World Bank and IFC, Doing Business 2011: Making a difference for entrepreneurs (World Bank and International Finance Corporation, Washington, DC, 2010).
39. See Kelsall, 'Rethinking'.
40. And for a country illustration, Brian Cooksey and Tim Kelsall, 'The political economy of the investment climate in Tanzania' (Research Report 01, Africa Power and Politics Programme, London, 2011).
41. Pierre Englebert, State Legitimacy and Development in Africa (Lynne Rienner, Boulder, CO, 2000).
42. Interviews with elderly and middle-aged Rwandan businessmen, Kigali, 11 March 2009 and 8 November 2010.
43. Uvin, Aiding Violence.
44. Gérard Prunier, The Rwanda Crisis: History of a genocide (Fountain Publishers, Kampala, 1999).
45. Frederick Golooba-Mutebi, 'Collapse, war and reconstruction in Rwanda: an analytical narrative on state-making' (Working Paper 2, Crisis States Research Centre, London, 2008).
46. See especially Prunier, Continental War, chapters 1-2, and Joseph Sebarenzi, God Sleeps in Rwanda: A personal journey of transformation (Oneworld Publications, Oxford, 2009).
47. The source of this suggestion is no doubt Kagame himself, but that does not necessarily mean it is wrong or just self-serving. It is discussed in Stephen Kinzer, A Thousand Hills: Rwanda's rebirth and the man who dreamed it (Wiley, Oboken, NJ, 2008), Chapter 13, and also in Rosen, 'Rising', where the direct source is the Ugandan journalist and publisher Andrew Mwenda. These are sympathetic but not uncritical commentators on Kagame's Rwanda.
48. Interviews, male senior government adviser, and middle-aged businessman, Kigali, 12 December 2009 and 23 February 2010.
49. Until recently, the firm's website rather confusingly named three individuals as 'shareholders': John Mirenge, James Gateera, and Faustin Mbundu. However, the legal position is that these three are RPF members with significant business experience who act as trustees on behalf of the party. Currently, the website states that CVL 'is wholly owned by Rwandan business people who pooled resources together to meet challenges of economic recovery and take advantage of growth opportunities in a virgin environment'.
50. See (24 March 2011; 25 February 2012).
51. Both these formulas reflect the sensitivity surrounding the idea of a governing political party being a substantial private entrepreneur, not the real situation. Interviews, male senior journalist; male CVL executive; male government minister; and male senior government figure: Kigali, 20 February and 8 November 2010, 17 February and 22 April 2011.
52. Interviews, male senior security official; male senior journalist; male former CVL executive; and male CVL executive: Kigali, 11 March 2009 and 20 February, 9 March, and 8 November 2010.
53. Inyange Industries (water, dairy, and fruit processing), Intersec Security (private security services), Bourbon Coffee (coffee shops), Mutara Enterprises (furniture imports), Graphic Print Solutions (print and design), Media Systems Group (media services), NPD-COTRACO (roads and civil works), Real Contractors (housing estates), CVL Developers (real estate), Ruliba Clays and East African Granite Industries (building materials).
54. The last two firms are controlled through a 50/50 joint venture with the Rwanda Social Security Board called Building Materials Industries Ltd. (25 February 2012) and personal communication from CVL chief executive officer, John Bosco Birungi, 20 February 2012.
55. See also The Independent, Rwanda: Remembering the liberation struggle (The Independent Publications, Kigali, 2012), pp. 64-95.
56. These are MTN Rwanda (mobile phones), 20 percent; Mount Meru-Soyco (cooking oil processing - a plant to be commissioned in July 2013), 20 percent; Rwanda Investment Group (see discussion below), 10 percent; and Ultimate Concepts (Kigali Convention Centre project), 20 percent. Some additional joint ventures have been registered recently, including CARCO (between Petroland Turkey and the CVL subsidiary NPD-COTRACO for commercial concrete production), NPD holding 50 percent (CEO John Bosco Birungi, 20 February 2012).
57. Bourbon Coffee now has outlets in Washington, DC, Cambridge, MA, and London (Independent, Rwanda, pp. 84-7).
58. Independent, Rwanda, pp. 84-87; (26 February 2011).
59. Extract from CVL 2009 accounts provided by CEO John Bosco Birungi, 20 November 2010. The same source gave the group's employment as over 5,000, of which 3,500 are classified as permanent.
60. Calculated from NISR, 'Gross domestic product' and Rwanda Revenue Authority, 'Annual activity report for 2009/10' (Kigali, 2010).
61. Interview, male CVL director, Kigali, 11 November 2010. The accounts are 'heavily audited'. Interview, male senior journalist, Kigali, 20 February 2010.
62. Interview, male former CVL executive, Kigali, 9 March 2010.
63. Interview, male government minister, Kigali, 17 February 2010.
64. Interviews, male former CVL executive, and male CVL executive, Kigali, 9 March and 8 November 2010.
65. Bruce Bueno de Mesquita, Alastair Smith, Randolph M. Siverson, and James D. Morrow, The Logic of Political Survival (MIT Press, Cambridge, MA, 2003).
66. Bueno de Mesquita, Logic, Chapter 3.
67. One key element in the RPF's power base, the armed forces, is no doubt well provided for corporately, as the theory would predict. However, even at the height of the interventions in Congo, individual military officers were under strong pressure not to acquire material benefits personally, in sharp contrast to the case of Uganda. This is based on interviews with senior DRC field commanders from both countries conducted by Frederick Golooba-Mutebi during the mid-2000s and reported in part in 'The Uganda People's Defence Forces in the context of its predecessor armies: continuity and change' (Draft paper, Makerere Institute of Social Research, Kampala, 2010).
68. This finding is based in part on direct observation by Frederick Golooba-Mutebi of several Annual National Dialogue sessions and the testimony provided to him by participants in ministerial retreats.
69. Straus and Waldorf, Remaking, pp. 3-21.
70. Filip Reyntjens, 'Rwanda, ten years on: from genocide to dictatorship', African Affairs 103, 411 (2004), pp. 177-210.
71. Interviews, male government minister; male senior journalist; and male CVL subsidiary manager: Kigali, 17 February, 20 February, and 23 February 2010.
72. Parties which get at least 5 percent of the popular vote are entitled to modest government funding as members of the Forum of Political Parties. President Kagame is said to be opposed to more substantial state funding for parties on the grounds that it would stimulate the formation of 'fake' parties. Interview, male senior journalist, Kigali, 20 February 2010.
73. The East African Bribery Index for 2010 found incidents in Rwanda to be 'negligible' - 78 bribery experiences out of 4,350 interactions. November 2011); also Transparency Rwanda ASBL, 'Rwanda Bribery Index 2010' (Kigali, 2010).
74. Interview, male senior international businessman, Kigali, 12 March 2009.
75. Theoretically inspired by an oathing ceremony performed by warriors at the royal court during the pre-colonial kingdom, the institution gets its force from the unusual level of backing, monitoring, and enforcement applied to it from the President's office downwards.
76. See, for example, Cooksey and Kelsall, 'Tanzania'.
77. Interview, male former senior journalist, Kigali, 13 December 2007.
78. Important friends of the RPF in the business community who have fallen foul of the regime's stringency on financial legalities include Rwanda's top tycoon, Tribert Rujugiro, who was removed from the National Executive Committee of the RPF when the UK and South African authorities questioned his tax status; and Alfred Kalisa, who was Tri-Star's senior operator in the banking sector until he was jailed for a period over the issuing of unsecured loans. Interviews, male senior journalist, and middle-aged Rwandan businessman, Kigali, 20 February and 23 February 2010.
79. Kayumba Nyamwasa, Patrick Karegeya, Theogene Rudasingwa, and Gerald Gahima, 'Rwanda briefing', August 2010, (26 February 2012), p. 28.
80. 'The assets of the RPF are, for all practical purposes, the personal wealth of President Kagame. The RPF does not have any committee or body that oversees all of its assets. . . President Kagame never reports to any of the organs of the RPF on the financial affairs of the RPF's business enterprises' (Nyamwasa, 'Briefing', p. 26). General Nyamwasa, one of the four people named as authors of the document, served for four years as an RPF nominee on the Tri-Star/CVL board of directors and in that capacity was a co-signatory to its accounts (Interview, male senior government figure, Kigali, 22 April 2011). He is therefore presumably aware that, as far as Tri-Star/CVL accountability is concerned, these comments are misleading.
81. On which, see Martin Dawson and Tim Kelsall, 'Anti-developmental patrimonialism in Zimbabwe', Journal of Contemporary African Studies 30, 1 (2012), pp. 49-66.
82. Some in government see this as primarily a donor concern. Interview, female senior civil servant, Kigali, 14 December 2007.
83. A study of 18 cases of 'disinvestment' by foreign or local firms was recently commissioned by the semi-official Private Sector Federation of Rwanda with a view to improving investor aftercare. The report included a quotation from the US State Department's Rwanda Investment Climate Statement 2010 to the effect that 'Some private sector firms assert that companies in which the government owns shares or have close ties to the government have been beneficiary of preferential treatment with regard to access to credit and in tax compliance enforcement.' However, none of the disinvestment decisions documented by the study involved concerns of this type (PSF/FSP, 'Disinvestment and investor aftercare in Rwanda: assessment report', Kigali, July 2011, p. 10).
84. For example, the Bourbon Coffee chain is the biggest user of the milk sachets produced by Inyange Industries; Intersec is the sole provider of security guards to the building sites of NPD-COTRACO and Real Contractors, and GPS provides printing services to several 'sister companies'. Interviews, male CVL subsidiary manager; second male CVL subsidiary manager; male middle-aged businessman; and third CVL subsidiary manager: Kigali, 23 February, 10 March, and 8 and 11 November 2010.
85. Interviews, male senior government adviser, and male CVL subsidiary manager, Kigali, 12 December 2007 and 23 February 2010.
86. (21 February 2012).
87. Interviews, male senior security official; male elderly Rwandan businessman; male former civil servant; and male private consultant: Kigali, 11 March and 12 March 2009; 19 February and 9 March 2010.
88. Interviews, male mid-range civil servant; middle-aged businessman; male mid-range civil servant; and second middle-aged businessman: Kigali, 10 and 11 March 2010, and 8 November and 8 November 2010.
89. For example, in 2010 furniture importer Mutara Enterprises had recently lost two large contracts (with the parastatal Electrogaz and the Ministry of the East African Community) to Zadok Furniture Systems of Kenya (interview, male CVL subsidiary manager, 16 November 2010). GPS reckons to win 70 percent and lose 30 percent of tenders despite its ultra-modern equipment. Interview, male CVL subsidiary manager, Kigali, 11 November 2010. Other examples were provided in interviews with male senior civil servant; male CVL subsidiary manager; male regional businessman; and male CVL executive: Kigali, 14 December 2007; 23 February, 12 March, and 8 November 2010. Among the 26 non-government, non-Tri-Star private business people we interviewed, a prevalent view was that the UK-trained Rwanda Revenue Authority is so harsh and inflexible that it would be unlikely to make concessions to anybody, and least of all to firms in the 'large taxpayer' category.
90. Interviews, male senior regional journalist; male former CVL executive; and male current CVL executive: Kigali, 18 February, 9 March, and 8 November 2010.
91. PSF/FSP, 'Disinvestments'; Interviews, male middle-aged businessman; second male middle-aged businessman; and female government minister: Kigali, 8 March, 11 March, and 10 November 2010.
92. The demonstration effects are sometimes bolstered with direct technical assistance, as in the advice provided by Inyange Industries to its main juice-bottling competitor Uribitso Enterprises, and by Bourbon Coffee to novice coffee-shop chains (interviews, male CVL subsidiary managers, Kigali, 10 and 11 March 2010).
93. Interviews, male government minister; male senior security official; and male former CVL executive: Kigali, 17 February 2010, 11 March 2011, and 9 March 2010.
94. Interviews, male CVL executive, and male CVL director, Kigali, 8 November and 11 November 2010.
95. Up to 2008 the company was headed by Efraim Turahirwa. In 2008 John Mirenge took over as executive chairman. In 2010 the role was divided: Professor Massaneh Nshuti became a non-executive chairman of CVL, with John Bosco Birungi as CEO. Turahirwa had been finance director of MTN and head of the Commercial Bank of Rwanda. Mirenge was recruited from Electrogaz and went on to manage the national airline. Nshuti is a former Minister of Commerce and Minister of Finance, while Birungi was hired from a US-based financial consultancy.
96. CVL monthly managers' meeting, Kigali, 11 November 2010; Interviews, male former CVL executive; male CVL executive; middle-aged businessman; male CVL director; and male CVL subsidiary manager: Kigali, 9 March, 8 November, 8 November, 11 November, and 15 November 2010.
97. Had the company's priority been to make large profits in a low-risk business, it would have gone into fuel importing and would have retained its early interest in banking after the financial sector started to prosper. Interview, male former CVL executive, Kigali, 9 March 2010.
98. Interviews, male former CVL executive; middle-aged information technology businessman; and male CVL executive: Kigali, 12 March 2009, 12 March 2009, and 8 November 2010; (26 February 2011).
99. (21 February 2012).
100. Today, the MTN operation is invariably one of the top two taxpayers in Rwanda. It employs 690 directly, only two of whom are expatriates. Indirect employment, including dealerships and security guards, is estimated at over 5,000. Interview, middle-aged businessman, Kigali, 12 March 2009.
101. Interview, male CVL subsidiary manager, Kigali, 11 March 2010.
102. David Booth and Frederick Golooba-Mutebi, 'Aiding economic growth in Africa: the political economy of roads reform in Uganda' (Working Paper 307, Overseas Development Institute, London, 2009).
103. Interviews, male CVL subsidiary manager; second male CVL subsidiary manager; male CVL executive; middle-aged businessman; and third CVL subsidiary manager: Kigali, 23 February, 10 March, 8 November, 8 November, and 11 November 2010.
104. Kelsall, 'Rethinking'
105. Diana Cammack and Tim Kelsall, 'Neo-patrimonialism, institutions and economic growth: the case of Malawi, 1964-2009', IDS Bulletin 42, 2 (2011), pp. 88-96.
106. Interview, former CVL executive, 9 March 2010.
107. Interview, male Horizon Group executive, Kigali, 15 November 2010.
108. Pyrethrum flowers are the raw material for an organic pesticide.
109. Interviews, male Horizon Group executive, Kigali, 15 November 2010; male Horizon subsidiary manager, Musanze, 18 November 2010.
110. Interview, male Horizon Group executive, Kigali, 15 November 2010.
111. Interview, male government minister, Kigali, 12 December 2007.
112. (26 February 2011)
113. Interview, male RIG executive, Kigali, 9 March 2010.
114. Interview, male RIG executive, Kigali, 9 March 2010.
115. Rwanda Investment Group SA, '2008 annual report' (RIG, Kigali, June 2009).
116. (26 February 2011).
117. Interview, male RIG executive, Kigali, 9 March 2010.
118. Nyamwasa, 'Briefing'.