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Cimerwa Now Profitable, But Can The Plant Satisfy Growing Demand?

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A few weeks ago, Rwanda’s sole cement producer, CIMERWA Ltd announced that it had made about Rwf4.5 billion francs in profit, a 24% margin, after several years of shifting difficult gears to find a profitable momentum.

Some observers had doubted the company would bounce back after succumbing miserable setbacks amid tight competition from regional players in the market.

A new team was set up, following rough views from President Paul Kagame wondering why the company was doing so badly despite government support at its disposal.

As the market expands with more than 900,000 tones expected to be consumed by end of 2020, the company’s CEO, Bheki Mthembu spoke to Taarifa, explaining how he turned the company around, the challenges he faced and how he intends to lay ground for continued growth before his contract expires soon. 

Can you take us through the journey since you took over as CEO?

In 2017, CIMERWA Ltd made some profits, it is not the first time we made profits, but it was just on lower margins, and on low volumes. In 2018, we sunk deep because we invested US$3 million towards plant maintenance and upgrade. It was significant and it is in the context. It was the only reason that brought up these results which are so much surprising to others. This year, if you compare us to last year, we are 20% up on volume, 24% up on revenue. It is quite exceptional. What drove the numbers is just the expansion we did at the plant to gain more sales volumes. There were some headlines we had in 2017, which we had to solve. In 2018 we had interruptions to revamp the structure. It was prolonged because we had to fix quite a lot of things at the plant. Now we are seeing the results of the investments we made and the opportunities that we lost. We understand you also revised how you deal with local suppliers…

It is specifically developing and promoting local businesses. We have mobilized quite a lot on the logistics side of things; the in hauling of raw materials such as gypsum and coal, as well as transportation of products from the plant to the market. We use purely local transporters. It is significant, if you look at our input cost of production.  Coal and gypsum have a significant contribution to high input cost of our finished cement product. Within the high landed cost of coal and gypsum transport is a major portion. We use local transport because in the past we could pay transport portion in the dollar denominated currency but now we pay in local currency. Apart from securing our critical raw materials in local currency, most critically, we have mobilize the local entrepreneurs to part-take in our logistics value chain. 

What market segment caters for your largest supply targets? 

Currently, our biggest consumer is the reserve force, government projects and a lot of clustered national distributors. 

What are the biggest projects that consumed your cement?

The reserve force on IDP model village homes, the Kigali Sports Arena, the Afriprecast solution, the international airport, but not as significant as we expected. We believe their volumes will significantly increase in the future.

How much can you produce at the moment?

480,000 tons per annum.

What are the market demand dimensions? 

As we speak, the national cement demand sits at around 750,000 tons per annum (tpa). 

We invested on 600,000 (tpa) and unfortunately, the plant could not get to its design capacity of 600,000 (tpa) because of the raw material high moisture. To make cement you need limestone. In Rwanda, limestone is found in the south-western region. Our limestone deposit sits on the Mashyuza hot-water spring.  Therefore as you mine it, it comes out with water, and that water is a huge problem for our process because we have to dry it. Typical limestone from a normal blast contains moisture levels of around 5-8%, where in our case, moisture can go up to 18-20%. The deeper you go into the mine, the more you get into the hot-water spring, and that is the challenge we are facing. It gets worse when it is raining, that’s why the technology that we will acquire going forward will have to be more efficient in limestone drying. 

Regarding the issue of cement from Uganda, could your numbers have gone up because of Hima Cement exit from the market? 

That is not true! We still have a lot of gaps in terms of cement capacity production in the country. Currently we are still importing cement from the Tanzanian suppliers, so there is still a substitute in terms of the gap that we are not reaching. Even today, if we were to produce all the 600,000 tons of cement, as per our design capacity, there wouldn’t be enough cement for our country that requires 750,000 tons per annum and by the end of next year, around 900,000 tons, and in 2021, it will be consuming more than 1 million tons. So, Rwanda is aggressively growing on its infrastructure delivery and we like the challenges, we have to wear our new thinking caps and roll up our sleeves to take advantage of this opportunity.

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Airtel Rwanda Partners With Canal+ To Ease Payment Of Subscription Fees Via Airtel Money

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Airtel Rwanda and Canal+ Rwanda have launched a partnership, enabling customers to easily make subscription payments.

The partnership announced at a joint press conference today provides clients of both CANAL+ and Airtel a simpler, instant and secure payments method using Airtel Money.

CANAL+ Rwanda is the subsidiary of CANAL+INTERNATIONAL, TV operator by satellite in Africa and present in over  25 African countries.

CANAL+ Rwanda have a trilingual package with 200 channels in French, Kinyarwanda and English and it offers accessible bouquet starting from 5,000 Francs with a distribution network throughout the country.

Speaking at the launch event, Airtel Rwanda Managing Director, Mr. Emmanuel Hamez said “We are delighted to launch this new service on our Airtel Money platform we welcome all Canal+ customers to enjoy the convenience and simplicity offered by Airtel Money both on the USSD as well as in the My Airtel App”.

The new service that was launched today comes on the heels of an ongoing Airtel Money campaign called Free P2P which enables all Airtel Money customers to send and receive any amount of money for FREE.

“Free P2P or Ohereza Amafaranga Ku Buntu was launched in June 2021 saw Airtel scrap all charges to send and receive money between customers, a major differentiator that positions Airtel Money to become the provider of choice when it comes to payment of good and services such Canal+ that we have launched today” added Hamez.

Canal+ Rwanda’s Managing Director, Madam Sophie TCHATCHOUA said “It gives me great pleasure to allow Canal+ client to renew their subscription with Airtel Money. The successful integration of our mutual services makes life easier for our beloved customers who can now recharge and seamlessly have their images back and all this can be done from the comfort of their home”.

To renew your subscription via Airtel Money, customers can simply dial the direct short code string *500*4*3*2*4*1# on either their smartphone on feature phone, input their 14 Digit of their decoder  number, select their preferred bouquet and make the payment which is recognized by the Canal+ billing system instantly.

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Hundreds Of Passengers Miss Flight In Uganda Due To Delayed COVID-19 Tests

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Hundreds of Ugandans have been left stranded at Entebbe International Airport by the Emirates Airways after the laboratory where they had taken their Covid-19 results delayed to return them on time.

In a Snapchat post by Ugandan socialite Sheila Gashumba, she ranted, ‘’When I tell Ugandans that Covid in Uganda is a business they say I have ‘kajanja’.

Now all Emirates passengers have missed their flights because Safari Lab sent Covid results at 2:45pm and Emirates closed its gate at 3pm.

The hospital said it couldn’t work on everyone in the short time.

Around 300 passengers missed their flight yet Safari Lab had made a total of UgSh75m since everyone had paid UGX 250,000 for the test.

In the video where all passengers were visibly angry and frustrated, they can be heard asking for what the solution is and who is going to pay for the tickets again now that those that they had paid for can no longer be used anymore.

Passengers expressed their frustration at the rot in the service.

“I experienced such thing in March as the officers in charge claimed that the gates were close at 1pm as the flight was at 3pm,” one twitter user said.

Some made jokes out of it and asked, if this was because of the US$10 tax that is in the process of being introduced and will be paid by anyone that leaves the country using the Entebbe International Airport.

Another twitter user @kasoxialex2000 asked, ‘’@UgandaCAA (Uganda Civil Aviation Authority), but seriously you guys when you move to some airports don’t you copy something? Why are we ever backwards??? Stop embarrassing us. Who will save Uganda’’
By press time there was no official communication from the Civil Aviation Authority, Safari Lab nor Emirates Airways.

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Kagame Tells Bankers, Banking Can’t Just Be “Service For Elites”

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Banking can’t just be a service for elites, President Paul Kagame has said.  He made the remarks while speaking at the 14th Annual Banking and Finance Conference in Nigeria that he attended virtually.

Running under the theme, ‘’Economic Recovery, Inclusion and Transformation: The Role of Banking and Finance’’, the two-day conference will aim at the need to reposition the Finance and Banking sector as a catalyst for Economic recovery, transformation and inclusive growth.

In his remarks, he noted how the Covid pandemic has affected every aspect of Africa’s economies but at the same time also presents an opportunity for African banks to play a leading role in making societies more resilient and more responsive to the needs of Africans.

‘’Whatever affects business, affects banking. Financial services are the engine of private sector development. Banks are crucial for allocating capital wisely and productively,’’ he further added.

President Kagame noted that, in order to stay competitive, there is need to keep integrating new technology into banking to increase financial inclusion and access as banking can’t just be a service of elites.

He also went ahead to reemphasize what he has always said when it comes to African states always depending on the West and other countries for support. ‘’Indeed, Africa has the resources to fund its own economic growth and reduce dependence on external resources,’’ he said.

Kagame also noted that the African Continental Free Trade Area is creating new opportunities for Pan African Trade and investment. ‘’Banks with continental reach, like several of the institutions represented here can lead the way in cementing economic integration.’’

As he concluded, he stated how the banking sector, more than any other, understands the importance of integrity and good customer service. ‘’Banking is ultimately about trust. We look to you to set the pace in this regard. Our role as governments is to maintain good enabling environments, protecting both shareholders and customers while allowing for innovation. We expect you to keep challenging us on this,’’ he said.

In attendance at the same conference was the Central Bank of Nigeria Governor Edwin Emefiele who made a huge announcement.  He said, ‘’Central Bank, will, in the next twelve months be establishing the Nigerian International Financial Centre (NIFC). The NIFC will act as an international gateway for capital and investments, driven by technology and payment system infrastructure.’’

In Rwanda, current statistics show that even though there are still various challenges that continue to put women behind men when it comes to financial inclusion, the number of women who are currently banked have risen from 24% in 2016 to 34% in 2021.

This is according to a FinScope 2020 Gender thematic report on the state of women financial inclusion in Rwanda that was supported by Access to Finance Rwanda (AFR).

In one of the Focus Notes from Access to Finance Rwanda, farmers reported that women and men enjoy equal rights and treatment at specified two Financial institutions in the Focus note and therefore no special gender based treatment yet the outcomes of each groups are not equal.

At both Financial Institutions, women and youths are more likely to use loans to hire land farm as they lack access to land and they have been assisted by addressing some of the barriers that women and youth face in accessing loans.

The conference will therefore focus on how banking can be a service enjoyed by all Africans regardless of their financial strengths through making access to finance for development is an easy and smooth process.

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