Hon. David R. Malpass
The World Bank
1818 H Street, NW
Washington, DC 20433
Hon. Kristalina Georgieva
International Monetary Fund,
1900 Pennsylvania Ave NW,
Washington, DC, 20431
African Development Bank Group
Avenue Joseph Anoma
01 BP 1387 Abidjan 01
April 17, 2020
Re: OneWeb Bankruptcy and President Paul Kagame’s Collapsing Financial Empire
In 1996, I had the honor to represent Rwanda as its first Ambassador to the United States after the civil war and genocide of 1994. In my first official interaction with the Bretton Wood Institutions, I wrote a letter to then World Bank President James Wolfensohn in which I pleaded for a Marshall Plan for Rwanda for reconciliation and reconstruction. In the letter I argued that because the world had looked away from Rwandans in their most tragic moments, it was a moral responsibility to help Rwandans rebuild their shattered lives. I even alluded to the fact that pre-1990 Rwanda received support and high marks from the World Bank and IMF as a model of development. In no uncertain terms, I informed President Wolfensohn that, as part of the international community, the Bretton Woods Institutions had committed sins of commission and omission that contributed to Rwanda’s civil war and genocide.
In the same year I was privileged and grateful to sign off on behalf of Rwanda, with the late Vice President Callisto Madavo from the World Bank, .the first $ 50 million post-genocide emergency recovery credit. I was personally involved in the elaboration of the first World Bank Country Assistance Strategy (CAS) that evolved into Rwanda’s Vision 2020.
Twenty six years later all Rwandans now remember again, as they do every day, the tragedies that have been inflicted on every Rwandan family. In those 26 years, the World Bank, the International Monetary Fund and the African Development Bank have been leading partners with Rwanda to support its recovery and development. We are grateful when your help causes no harm and serves the needs of all Rwandan people.
I am writing to tell you, once again, that Rwanda is in serious trouble, and that your institutions are neglecting the plight of the majority of Rwandans. Without urgent change of course your institutions will become part of Rwanda’s problem, with grave and harmful implications in the years and decades ahead.
Why do I say this?.
On March 27, 2020, a global satellite company OneWeb announced that it had filed for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York in the United States of America. Earlier, in March 2019, the Government of Rwanda, alongside SoftBank, Qualcomm, Grupo Salinas invested U.S.$1.25 billion in the satellite company. The size of Rwanda’s investment in OneWeb, and the extent of its losses is still shrouded in mystery.
The story does not end there. The Chairman and Founder of OneWeb, Greg Wyler, is an American personally known to President Kagame. In 2006, the Government of Rwanda donated free of charge to Greg Wyler’s company, Terracom , 99% percent control of Rwandatel, then Rwanda’s one and only fixed-phone company. A year later, in 2007, the Government of Rwanda bought back Rwandatel from Terracom for U.S.$ 11.91 million, only to resell it to a Libyan company, LAP Green, for U.S. $100 million. In 2011, President Kagame publicly advocated for the violent overthrow and killing of Libya’s President Muammar Gaddafi. LAP Green’s investments in Rwanda were then “frozen”. Declared “insolvent”, Rwandatel was sold to Liquid Telecom Rwanda in 2013 for only US $ 4 million! Liquid Telecom Rwanda is supposedly a subsidiary of Econet Wireless. Besides making money for private gain, Liquid Telecom Rwanda is led by President Kagame’s close friend on behalf of Rwanda’s military and intelligence network for national surveillance and regional espionage purposes.
A further snapshot of President Kagame’s businesses, investments and projects reveal a vast financial empire:
- Crystal Ventures: Owned by the ruling party, Rwandese Patriotic Front, RPF.
- Horizon Group: Owned by the Rwanda Defence Forces, RDF.
- Prime Holdings: Party-Military-Intelligence ownership and control.
- MTN Rwandacell: Crystal Ventures is a shareholder.
- Kigali Convention Center: Prime Holdings is the majority shareholder in a U.S. $300 million investment.
- Kigali Marriott: Hatari Sekoko and Billy Cheung are listed as the private owners of the hotel. Sekoko is a Rwandan military intelligence officer who is President Kagame’s personal front man in most of his businesses.
- Serena Hotel : Formerly Intercontinental Hotels, was built on Rwanda’s taxpayer’s money to a tune of U.S. $ 40-50 million. Prime Holdings was involved in the construction of the hotel.
- Merrimack Pharmaceuticals: U.S $ 16 million of Rwanda’s pension funds were invested in the U.S. start-up in 2008/2009. Two Americans, Harvard Business School Professor Michael Porter, and Dr. Clet Niyikiza were listed as investors in the start-up. Dr. Niyikiza was Merrimack’s Executive Vice President for Development. Professor Porter and Dr. Niyikiza serve on President Kagame’s Presidential Advisory Commission (PAC).
- L.E.A.F Pharmaceuticals Rwanda: a subsidiary of U.S. based L.E.A.F. Pharmaceuticals, whose President, CEO and Founder is Dr. Clet Niyikiza. Dr. Niyikiza has close personal ties to President Kagame and Rwanda’s party-military-intelligence establishment.
- Arsenal Football Club: Rwanda paid the equivalent of U.S.$ 40 million to the UK football club to have its players wear “Visit Rwanda” logo on one sleeve.
- Bugesera International Airport: a second airport to initially cost U.S.$828, and U.S.$ 1.31 billion at completion.
- Kigali Arena: A basketball arena whose construction cost U.S. $ 104 million
- RwandAir: Purchase, lease or order of 12 aircrafts to the tune of U.S. $1.631 billion in a loss-making enterprise. RwandAir stays afloat on government subsidies.
- Presidential foreign travels and luxury jets: Since 2003 President Kagame has successively purchased 2 Bombardier Global Express BD-700 jets, and 2 Gulfstream 650G jets, a combined cost of about U.S. $ 230 million. Hatari Sekoko is a signatory to these purchases. The Rwandan taxpayer has to pay President Kagame’s companies every time he “charters” the jets for his frequent travels. On average he spends 80% of his time on foreign travels. His hotel accommodations cost the Rwandan taxpayers more than U.S $ 16,000 a night.
- Arab Contractors: Constructed the Ministry of Defence Headquarters in Kigali as well as President Kagame’s private home at Lake Muhazi in Rwanda on terms he has never revealed to the public.
- Dubai Port World: The UAE entity obtained 25-year concessions to build an inland port, the Kigali Logistics Platform (KLP).
- Volkswagen car plant: Unknown terms and concession for the car plant with 0% local content
- Quatar Airways: Offered 60% stake in Bugesera International Airport and 49% stake in RwandaAir
You may even wonder why President Kagame should be interested in sending satellites into space, loot national public assets in the name of privatization, build five-star hotels and conference centers that are loss making, build a monumental second international airport when his citizens have never stepped in the first one, live luxuriously in a country of a poverty-stricken population, run an airline that has never made a profit, sponsor a British football club from a country whose taxpayers donate foreign aid to Rwanda, make opaque investments in rich USA (a donor to Rwanda) using pension funds of poor Rwandans, or launch wars of plunder in the Democratic Republic of Congo.
A close scrutiny of these businesses and investments reveals the character of President Kagame, and the multifaceted tools he uses to maintain his brutal rule through the totalitarian one-party state he controls. The Rwandan state is run by his intelligence services, the military, and the ruling party RPF, on his behalf. This political-military-intelligence nexus is a seamless and extensive connection that dominates and occupies every nook and corner of Rwandan society. Its parasitic nature entails using public resources for private gain, and in grandiose projects that serve no business or social needs. Without accountability to anyone except President Kagame, this nexus has elbowed out of existence other stakeholders in the economy, politics, social discourse, and community except those that it feeds on, co-opts or corrupts.
Because it is narrowly constructed from within a fearful minority Tutsi community, it relies on brute coercion rather than the consent of citizens. It needs vast resources to grease the machinery of projecting abroad its false narrative about Rwanda, keeping the Tutsi community in perpetual fearful mode, fending off potential rebellion from the marginalized majority Hutu population, imprisoning opponents, assassinations, disappearances, regional wars of plunder and destabilization, ubiquitous surveillance of citizens, and espionage abroad.
Above all, the party, the military and intelligence services must enrich President Kagame and his family. He then decides who he rewards or punishes in this high-risk, fast-paced, top-down, and efficient dispensation that has so far served him well.
It is then very surprising indeed that your institutions are missing the ominous signs for the second time. Your assessments of Rwanda leave the majority of Rwandans asking themselves whether you are describing the same country they know and live in, or their real conditions of its people.
The World Bank says:
Rwanda is one of the few countries anywhere in the world that has managed fast economic growth, robust reductions in poverty, and a narrowing of inequality”
Rwanda has guarded its political stability since the 1994 genocide. Parliamentary elections in September 2018 saw women fill 64% of the seats, the Rwandan Patriotic Front maintain an absolute majority in the Chamber of Deputies and, for the first time, two opposition parties, the Democratic Green Party of Rwanda and Social Party Imberakuri, winning two seats each in the parliament. President Paul Kagame was re-elected to a seven-year term in the August 2018, following an amendment to the constitution in December 2015 allowing him to serve a third term.”
The poverty rate fell from 59 percent to 45 percent in the last decade and Rwanda is now ranked as the second easiest place to do business in all of Africa”. Rwanda – Country partnership strategy FY2014-18 (Vol. 2)http://documents.worldbank.org/curated/en/735901468336703252/Main-report
The International Monetary Fund continues:
Rwanda has made notable progress in reaching its development objectives. Rapid and inclusive growth has been based on a combination of strategic goal-setting, public accountability, and broad ownership of policies”- STAFF REPORT FOR THE 2019 ARTICLE IV CONSULTATION:https://www.imf.org/en/Publications/CR/Issues/2019/07/03/Rwanda-Staff-Report-for-2019-Article-IV-Consultation-and-a-Request-for-a-Three-Year-Policy-47089
The African Development echoes similar official line:
Rwanda’s has overcome the 1994 Genocide to become a top reformer and one of the fastest growing countries globally. Following the end of the genocide against the Tutsi in 1994, Rwanda has made significant progress towards political stabilization, reconciliation and the rule of law. Sustained implementation of reforms and a prolonged period of peace and political stability have contributed to impressive socio-economic development”- RWANDA BANK GROUP COUNTRY STRATEGY PAPER 2017 – 2021
By and large these statements re-enforce and project the very narrative that is at the heart of the party-military-intelligence nexus that runs Rwanda on behalf of President Kagame.
Are Rwandans now richer and happier than they were in the past? Is there any shred of evidence that Rwanda has overcome the causes of civil war, genocide, inter-ethic and intra-ethnic divisions and polarization? Have Rwandans healed from repeated and continuing trauma? Is Rwanda politically stable? Has it achieved reconciliation? Is wealth more evenly and fairly distributed now than in the past? Is Rwanda’s economic growth organic and sustainable? Is the Government of Rwanda accountable to its citizens? Is decision-making and policy making in Rwanda democratic and broadly owned? Is parliament or President Kagame democratically elected in free and fair elections? Are there checks and balances between the Executive, Legislative and Judiciary branches of government? Is Rwanda characterized by the rule of law? Do all citizens expect justice as fairness? Have the crimes committed by the RPF regime against the Hutu community been acknowledged and perpetrators brought to account? Can Hutu community members remember their dead? Is civil society functional? Is there press freedom? Is Rwanda at peace with her neighbors?
Absent factors of fear, intimidation, and threat of death, the majority of Rwandans would answer all the above questions with a resounding “No”.
The business of “doctoring statistics”, a habit of all totalitarian regimes, has reached ominous levels in Rwanda. Your institutional footprint remains tethered to the capital city, where your staff hobnob with agents of the state deployed in every local or international organization. Without conscious effort to seek out the people in their true living conditions, your institutions can easily become unconscious hostages who cut and paste Rwanda’s official narrative described as National Strategies for Transformation.
President Kagame’s businesses, investments and projects are neither national, strategic, nor transformational. These grandiose projects are certainly not a viable pathway to make Rwanda a middle income country by 2035, nor a rich country by 2050. They are white elephant projects constructed for his personal gain and survival of his minority regime. They are indeed a Ponzi scheme, a bubble that will soon burst with devastating consequences. His obsessive adoration of these idols has been on public display when he says he will kill any Rwandan in their defense.
Life in Rwanda is still nasty, brutish and short. Even before Covid-19, the country was on lock-down. It is paradoxical that a landlocked country which markets itself as a reformer and best place to do business would close its borders with neighbors. It is a country with peasants living in a subsistence economy, where the property of the poor is destroyed to pave the way for the regime’s pet projects, and where people still suffer from jiggers, lice and worms. Barefoot, hungry, and thirsty for water, children have one meal a day if they are lucky. Unemployment is rampant, while teachers, healthcare workers, soldiers, policemen and civil servants barely survive on meagre salaries. Rwandans watch in fear and hidden disgust the scandalous opulence of President Kagame, his family, friends and the clique that keeps him in power. The false façade of calmness, clean streets, and orderliness masks latent anger in a silent emergency. Rwanda is a mood of eerie silence and heightened anxiety as in pre-1959, 1973 and pre-1990.
The works of your institutions in Rwanda are at strategic crossroads. Your institutions can only be helpful to Rwandans when you are a witness to their real conditions, when you listen to their genuine fears and aspirations, when you show interest in asking good questions, and when you become trusted partners in co-creating sustainable solutions for a shared future.
You will have to make a choice as to whom you will serve: President Kagame’s party-military-intelligence realm of white elephants doomed to fail, or the interests of the majority of the Rwandan people?
History will be waiting to pass judgement.
Dr. Theogene Rudasingwa
ISHAKWE-Rwanda Freedom Movement
Contact: [email protected]
U.S. Securities and Exchange Commission
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Vice President, Africa
The World Bank
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Independent Evaluation Group
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Independent Evaluation Office
of the International Monetary Fund
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