Authored by:
Patricia Jones Lino Ferreira
University of Oxford
Sally Murray IGC, Rwanda
March 2016
Copyright © World Bank, 2016
Kigali- A Policy Narrative
Multi Donor Trust Fund for Sustainable Urban Development
KIGALI:
A POLICY NARRATIVE
ABSTRACT:
In this policy narrative, we examine the urban development of Kigali from its pre-colonial past to the present day. Our analysis covers both the spatial development of the city as well as its economic development. Special emphasis is given to the historical development of the city’s structure of governance as well as it land and housing markets. To carry out this analysis, we use a wide range of sources including satellite data, census data, and geo-referenced firm data.
*This paper is a part of a Global Research Program on Spatial Development of Cities, funded by the Multi Donor Trust Fund on Sustainable Urbanization of the World Bank and supported by the UK Department for International Development.
Patricia Jones
Lino Ferreira
University of Oxford
Sally Murray
IGC, Rwanda
March 2016
1
Contents
Kigali at a Glance ................................................................................................................................... 2
Pace and Magnitude of Urbanization .................................................................................... 2
City Layout ...................................................................................................................................... 3
Industrial and residential areas .............................................................................................. 5
Population and population density ....................................................................................... 5
Population Density ....................................................................................................................... 8
Why Cities Matter ......................................................................................................................... 8
Structure of the Urban Economy .......................................................................................... 10
The Benefits of Agglomeration .............................................................................................. 11
Regional concentration of industries .................................................................................. 14
References .................................................................................................................................................. 17
Governance ........................................................................................................................................... 19
2.1 Brief History ................................................................................................................................. 19
2.2 Centralized Governance ........................................................................................................... 23
References .................................................................................................................................................. 23
Land ......................................................................................................................................................... 24
3.1 Land Ownership .......................................................................................................................... 24
3.2 Land Disputes .............................................................................................................................. 24
3.3 Land Transfer ............................................................................................................................... 25
3.4 Land Regulations and Zoning ................................................................................................ 26
3.5 Mortgage Markets ...................................................................................................................... 26
3.6 Tenure Security ........................................................................................................................... 26
References .................................................................................................................................................. 29
Housing Markets ................................................................................................................................. 31
4.1 Informal Settlements ................................................................................................................. 31
4.2 Government Housing Schemes ............................................................................................. 31
References .................................................................................................................................................. 32
2
Kigali at a Glance
Pace and Magnitude of Urbanization
Kigali is urbanizing fast. Between 1990 and 2010, its population increased more than
five-fold, growing from 219,000 to 1.2 million inhabitants (UN Population Division,
2015). As its population has increased, so has its spatial footprint (Figure 1-1). Satellite
imagery reveals that much of the city’s recent growth has taken place near the city’s
central business district (CBD) and airport area which lies to the east of the CBD.
FIGURE 1-1: GROWTH OF BUILT-UP LAND IN KIGAI SOURCE: BARUAH, 2016. While Kigali is growing fast, Rwanda is only about one-third of the way through its
urbanization process. This gives policy makers a window of opportunity to design new
policies which avoid the mistakes of the past. From global experience, we know that
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urbanization can bring large benefits to both workers and firms through productivity
gains associated with agglomeration economies. To date, however, the evidence suggests
that Nairobi is not taking full advantage of these benefits.
In this policy narrative, we examine the major policies which have influenced Rwanda’s
economic and spatial development. Special emphasis is given to the historical
development of the city’s governance structure as well as its land and housing markets.
City Layout
Kigali is comprised of three districts: Gasabo in the north, Nyarugenge in the south-west
and Kicukiro in the south-east. Districts are divided into sectors (there are 35 sectors in
total) which in turn are divided into cells (161 in total). Cells are divided into 1,061
villages, the lowest administrative level.1 Figure 1-2 shows the districts and sectors of the
city.
1 These numbers were obtained from the website of the City of Kigali.
FIGURE 1-2: DISTRICTS, SECTORS, & THE CBD IN KIGALI
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In Figure 1-2, the Central Business District (CBD) is identified by a star. It is located in the
Nyarugenge district, close to the frontier of this district with the Gasabo and Kicukiro
districts.2
Kigali is a monocentric city centred around the CBD. Figure 1-3 shows the population
density (total population divided by area in square kilometers) for the different cells of
the city. The cells with the highest population density are located immediately around the
CBD in Kiyovu.3 Density then decreases as we move away from the CBD.
2 For the purpose of this analysis we defined the CBD as the downtown area where administrative buildings such as the Ministry of Finance and Economic Planning or the National Bank of Rwanda are located. The CBD is treated as the city centre in the analysis of distance to the centre developed below. 3 Data on density, as well as all other figures and maps included in this document unless otherwise stated, were obtained from a dataset containing information from the 2012 Population and Housing Census which was kindly provided by the National Institute of Statistics of Rwanda.
FIGURE 1-3: POPULATION DENSITY IN DIFFERENT CELLS IN KIGALI
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The CBD is the most important commercial node in the city. Commercial activities extend
eastwards from the city center towards the Kigali International Airport along the
Boulevard de L’Umuganda. There are commercial clusters around the roundabout in the
CBD, Gishushu, Gisimenti and the airport west junction. There are other commercial
nodes in residential areas (City of Kigali, 2016).
Industrial and residential areas
The largest industrial node in the city is located in Gikondo, between the CBD and the
airport. The City of Kigali, the administrative organ of the city, is currently in the process
of relocating some industries to the Kigali Free Trade Zone, an area which lies to the north
of the airport (City of Kigali, 2016).
Residential areas are located in 17 different sectors. Most of the residential nodes are
located around the CBD and constitute unplanned, high-density areas. There are also
planned residential areas with lower densities, some of which are located in the Gasabo
district along the east-west regional road (City of Kigali, 2016).
Population and population density
In 2014, Kigali had a population of approximately 1.223 million people, making up 10.8%
of Rwanda’s total population (NISR, 2014). This marks an increase of almost 8% from
2012, when its population was estimated at 1,132,686 according to the most recent
Population and Housing Census. Between 2002 and 2012, the city’s average annual
growth rate was 4%, making it one of the fastest growing cities in Africa (NISR, 2014).
The average population density across the city is 1,433 people/km2. Of the three districts,
Nyarugenge, where the CBD is located, has the highest density with 1,942 people/km2. It
is followed by Kicukiro with 1,812 and Gasabo with 1,129. The median village has a
population density of 2,611 people/km2. As noted above, popualation density is is
highest in the areas that surround the CBD. Figure 1-4 below shows the centre of the city
at a larger scale, now with village rather than cell boundaries. We can observe the same
pattern as in Figure 1-3 that the areas with the highest population density are located
mainly to the west and south of the CBD. Similarly, population density declines gradually
as we move away from the CBD.
The village with the highest density is Inyamibwa in the Kimihurura sector in Gasabo.
This village is visible in the map above and has a density of 61,334 people/km2. Among
the sectors, Gitega, immediately to the west of Nyarugenge, has the highest density with
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23,996 people/km2. Nyarugenge (where the CBD is located) has a density of 4,844
people/km2 while Muhima, just north of Nyarugenge, has a density of 8,594 people/km2.
Figure 1-5 below shows the density gradient relative to the city centre (which we equate
to the CBD) for Kigali. The gradient is in line with the density maps shown above: density
is highest—not at the CBD itself— but a relatively short distance (around 2km) from it.
At 0.5km from the centre, population density is 1,052 people/km2. This increases to 4,679
at 1km, then to 10,177 at 1.5km, and peaks at 10,635 at 2km from the centre. It then
decreases more or less uniformly as distance from the centre increases, although there
are several local peaks. The most pronounced of these peaks occurs at 4.5km, where the
density is 5,448 people/km2.
FIGURE 1-4: POPULATION DENSITY AT THE VILLAGE LEVEL IN THE CENTRE OF KIGALI
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Table 1-1 below contains similar information. It shows the percentage of Kigali’s
population living further than a certain distance from the city centre (considered to
correspond to the CBD). In line with the graph above, which shows that the city centre is
sparsely populated, the great majority of people (99.03%) live further than 1km from the
centre. 76.12% live further than 3km, while more than 55% live further than 5km from
the CBD. Almost one quarter of the population (23.3%) live more than 10km away from
the centre. Finally, 10.78% live further than 15km and only a very small percentage
(1.64%) lives more than 20km away from the centre.4
TABLE 1-1: PERCENTAGE OF KIGALI’S POPULATION LIVING AT DIFFERENT DISTANCES FROM THE CBD
Percentage living further than…
Percentage
1km from the centre 99.03%
3km from the centre 76.12%
5km from the centre 55.43%
10km from the centre 23.3%
15km from the centre 10.78%
20km from the centre 1.64%
4 The village in the data which is furthest away from the centre (Gakenyeri in the Rusororo sector in the Gasabo district) is located at approximately 23.1km from it.
FIGURE 1-5: DENSITY GRADIENT RELATIVE TO THE CITY CENTRE (CBD) FOR KIGALI
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Population Density
Compared to Asian cities at comparable levels of economic development, Kigali is not a
dense city. As illustrated by Figure 1-6, its population density is about 9,800 people per
square kilometer (Demographia World Atlas, 2015) as compared to 15,300 in Manila and
32,400 in Mumbai (Demographia World Atlas, 2015). While recent research reveals that
larger cities have higher population density than smaller cities (Angel et al., 2011), Kigali
is actually smaller than most of its East African neighbors—like Nairobi, Dar es Salaam,
and Kampala— which have lower population density.
FIGURE 1-6: POPULATION DENSITY IN CITIES ACROSS THE WORLD SOURCE: DEMOGRAPHIA WORLD URBAN ATLAS (2015). NOTES: THE ESTIMATED POPULATION DENSITY FOR RWANDA IS SLIGHTLY HIGHER THAN OUR ESTIMATES RESULTING FROM A DIFFERENT DEFINITION OF THE URBAN EXTENT.
Why Cities Matter
Evidence from today’s developed countries and rapidly emerging economies shows that
urbanization is a source of dynamism that can lead to enhanced productivity and
increased economic integration. In fact, no country in the industrial age has achieved high
income status without urbanization, and there exists a strong association between per
700
3,800
3,900
4,100
4,300
4,400
5,500
5,900
6,000
6,100
6,300
6,600
7,400
7,500
7,700
8,500
9,800
9,800
11,800
12,300
14,800
15,300
18,100
18,300
19,900
32,400
43,500
Atlanta
Paris
Kampala
Durban
Accra
Jakarta
Khartoum
London
Ho Chi Minh City
Shanghai
Maputo
Luanda
Dar es Salaam
Sao Paulo
Addis Ababa
Nairobi
Colombo
Kigali
Casablanca
Lusaka
Abidjan
Manila
Dakar
Bogota
Kinshasa
Mumbai
Dhaka
Average Population Density (population/km2) in Selected Cities
9
capita income and urbanization (Figure 1-7) and per capita income and export shares
(Figure 1-8). Well managed cities can “open the doors” to global markets in two ways: 1)
by creating productive environments which attract international investment and
increase economic efficiency; and 2) by creating livable environments which keep in
check rising urban costs that arise from increased densification.
FIGURE 1-7: URBANIZATION & DEVELOPMENT
SOURCE: AUTHORS’ CALCULATION BASED ON WDI DATA.
FIGURE 1-8: EXPORTS & DEVELOPMENT
History shows that the industrial development of modern economies almost always
begins in cities. The benefits of being around other people and other businesses are
typically labelled ‘agglomeration economies’ which is the starting point for
understanding how cities enhance productivity. The most basic agglomeration economy
is the reduction of transport costs for goods. If a supplier locates near customers, the costs
of shipping decline. In the early 1900s, New York and London were manufacturing
powerhouses, places where factories located to be close to customers and transport
infrastructure. And, in the late nineteenth century, four fifths of Chicago’s jobs were
compactly located within four miles of State and Maddison streets, close to where people
lived and infrastructure was located (Grover and Lall, 2015). Many of these benefits
increase with scale: towns and small cities cannot generate the same productive
advantages as larger cities. International evidence reveals that the elasticity of income
with respect to city population is between 3% and 8% (Rosenthal and Strange, 2004).
Each doubling of city size increases productivity by 5%.
Productivity gains are closely linked to urbanization through their ties to structural
transformation and industrialization. As countries urbanize, workers move from rural
areas to urban areas in search of higher paying and more productive jobs. Similarly,
entrepreneurs choose to locate their firms in cities where agglomeration economies
increase their productivity. Close spatial proximity has many benefits. Certain public
goods—like infrastructure and basic services—are cheaper to provide when populations
are large and densely packed together. Firms that are located near each other can share
suppliers which lower input costs. Thick labor markets reduce search costs as firms have
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a larger pool of workers to choose from whenever they need to hire additional labor. And
spatial proximity makes it easier for workers to share information and learn from each
other. International evidence shows that knowledge spillovers play a key role in
determining the productivity of successful cities. In US cities, for example, a 10% rise in
the percentage of workers with a college degree leads to a 22% rise in per capita
metropolitan product (Glaeser, 2011).
Structure of the Urban Economy
Africa’s failure to industrialize is a cause for concern because much of the growth in
developing countries since the 1980s has been linked to the expansion of industrial
production and high-technology exports (Nallari et al, 2012). All else equal, countries are
better off when they export goods that rich countries export (Hausman, Hwang, and
Rodrik, 2006). Fast growing countries, like China, have switched from exporting mainly
resource and agro-based products to exporting high-technology products like optical
devices, transport equipment, and white goods. As noted by Nallari et al (2012): the big
gainers in China “were exports of electronic and telecommunications products and office
equipment, the shares of which grew from 5.4 percent in 1985 to more than one-third in
2006.” Other Southeast Asian countries experienced a very similar transition in their
export-mix during the last decade (Table 1-2). By contrast, the exports of Rwanda—like
most other African countries—remain largely resource and agro-based (Table 1-3).
TABLE 1- 2: TOP TEN COMMODITIES EXPORTED BY ASIA IN TERMS OF VALUE, 2000-2010
Commodity Trade value, billion USD Electrical, electronic equipment 7412.3 Nuclear reactors, boilers, machinery, etc. 5049.8 Vehicles other than railway, tramway 2179.4 Mineral fuels, oils, distillation products, etc. 2059.4 Optical, photo, technical, medical, etc. apparatus 1088.0 Plastics 905.3 Articles of apparel, accessories, knit or crochet 800.7 Articles of apparel, accessories, not knit or crochet 782.6 Pearls, precious stones, metals, coins, etc. 773.0 Iron and steel 746.0
Source: Author’s calculations based on UN Comtrade Database. Note: Asia includes East Asia, South Asia and Oceania. Missing values in the original data were imputed through linear interpolation and constrained to be non-negative.
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TABLE 1-3: TOP TEN COMMODITIES EXPORTED BY RWANDA IN TERMS OF VALUE, 2001-2010
Commodity Trade value, million USD Coffee, tea, mate and spices 718.1 Ores, slag and ash 569.2 Mineral fuels, oils, distillation products, etc. 148.3 Vehicles other than railway, tramway 56.4 Optical, photo, technical, medical, etc. apparatus 43.2 Beverages, spirits and vinegar 39.9 Raw hides and skins (other than furskins) and leather 28.9 Nuclear reactors, boilers, machinery, etc. 25.8 Electrical, electronic equipment 20.7 Edible vegetables and certain roots and tubers 19.6
Source: Author’s calculations based on UN Comtrade Database. Note: Data for the year 2000 were not available. Missing values in the original data were imputed through linear interpolation and constrained to be non-negative.
The Benefits of Agglomeration
Paul Krugman’s New Economic Geography theories explain how economies of scale in
production combined with reduced transport costs can lead to increased geographic
concentration of people and economic activities (Krugman, 1991). There are many well-
known examples of industrial clustering: the Silicon Valley and Bangalore technology
hubs, the automobile industry in Detroit, the diamond industry in Antwerp, or the wine
industry in Mendoza.
When firms cluster together, spatial proximity is beneficial to firms. Localization
economies arise when firms within the same industry benefit from locating near each
other. Increased efficiency can result from labor market pooling, sharing inputs,
specialization in the course of production, and/or the exchange of information and
knowledge (Marshall 1920; Duranton and Puga 2004; Rosenthal and Strange 2004; WDR
2009). In locations characterized by a high concentration of economic activity,
investment in infrastructure is likely to generate high returns and attract additional
investment, provided such investment relieves the congestion costs associated with a
greater number of firms (Lall, Schroeder and Schmidt 2008)
In addition, proximity can also act as a disciplining mechanism. Less efficient firms find it
difficult to remain in business when nearby firms are able produce output at a lower cost.
“If consumers were unencumbered by substitution barriers, production would be
reallocated to a select few, highly productive plants.” (Syverson, 2004). In reality, large
barriers to substitution exist across producers (caused by product differentiation,
physical barriers, or high transport costs) which enable inefficient firms to survive, even
in the long-run. Lower prices benefit consumers. Firm clustering makes it easier for
consumers to switch between suppliers and buy from the firm with the cheapest goods
or services. In addition, consumers like variety and prefer to shop where there are many
sellers located near each other. Spatial proximity can also benefit firms that are not in the
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same industry. For example, a management consulting company might benefit from
locating near business schools, financial service providers, and manufacturers.
In the presence of agglomeration effects, concentration has been shown to be stable over
time: old plants are replaced by new plants. Historical accidents therefore lock mobile
firms in existing areas and/or inefficient patterns (Arthur, 1986; Krugman, 1991). The
effects of infrastructure policies are likely to be insignificant unless coordination allows
the gains from relocation to exceed the gains from staying (Lall, Schroeder and Schmidt,
2008).
Why firms cluster is an important policy question. Are firms constrained in their location
choice by the existence of infrastructure networks, such as roads and electricity? Or are
they exploiting natural advantages and/or physical and intellectual spillovers? (Ellison
and Glaeser, 1997) In the former case, policies aimed at expanding infrastructure in the
periphery such as the establishment of special economic zones or growth poles should be
considered. If well regulated, special economic zones can help promote agglomeration
economies by allowing firms to move outside of cities, where land is cheaper, without
losing access to markets. If on the contrary, natural advantages are more important, these
advantages may soon lose importance relative to the negative effects of increased
congestion costs. This can happen if infrastructure does not improve in congested areas,
which will limit the positive spillovers associated with economic development (Lall,
Schroeder and Schmidt, 2008).
It is important to emphasize that spatial economic concentration does not take place at
the cost of inequality in living standards both within and outside cities. Different policy
instruments are available to encourage spatial efficiency while at the same time
supporting spatial equity (WDR, 2009). Therefore, the biggest challenge lies in identifying
the payoffs and tradeoffs of alternative policy instruments. Such policies should be
realistic and hence depend on the stage of development and the fiscal and institutional
capacities of a country (Lall, 2009).
The average African firm employees 20% fewer workers than comparable firms in other
developing countries (Iacovone, Ramachandran, and Schmidt, 2014). One reason for this
is that firms which specialize in tradable activities are larger than those which specialize
in non-tradable activities—and African cities have smaller tradable sectors than cities in
other regions. Understanding why the tradable sector is so small in African cities is
central to understanding their future growth prospects.
Geo-referenced firm censuses for Kigali and Lusaka allow us to measure the density
gradient as we move away from the Central Business District (CBD). A falling gradient is
consistent with the view that firms cluster near each other when land prices are high (i.e.,
near the CBD) and when there are benefits from agglomeration (e.g. larger markets,
better services, knowledge spillovers, etc.). Firms are willing to pay these high rents
because the benefits they receive from locating near the CBD outweigh the costs of
locating there.
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Source: Rwanda economic censuses
As depicted in Figures 1-9, the share of jobs in the tradable sector tends to decrease with
the distance to the CBD. A similar pattern emerges for formal sector jobs (Figure 1-10).
As expected, the density of formal sector jobs is highest near the CBD. These firms tend
to be larger than informal sector firms and more likely to benefit from agglomeration
economies. Similar to other cities in Africa, informal sector employment is highly
concentrated near the CBD as well.
FIGURE 1-9: KIGALI, THE SHARE OF TRADABLE SECTOR JOBS DECREASES WITH DISTANCE TO THE DOWNTOWN
FIGURE 1-10: KIGALI, THE SHARE OF FORMAL SECTOR JOBS DECREASES WITH DISTANCE TO THE DOWNTOWN
With a high concentration of jobs in the downtown, good access to the city center for a
dispersed population is crucial. This is the case for Kigali where 80% of all city jobs are
located within 5km of the downtown. In African cities, most workers either walk or cycle
to work which means that their access to formal sector jobs is limited by how far they can
travel using these methods of transport. The most accessible job is one that is run from
home. In Kigali, 72% of firms are single-person enterprises (usually run from home), 97%
are informal businesses and within the informal sector, 90% of firms engage in non-
tradable activities. In Lusaka, the share of the small to large firm is larger than in both
Kampala and Kigali (Table 1-4).
TABLE 1-4: SHARE OF FIRMS BY SIZE
Kigali Lusaka Kampala
Self-employed 72.23 50.65 55.5
Micro (2-4) 22.49 28.36 36.03
Small (5-49) 5.05 18.74 6.25
Medium (50-99) 0.14 1.15 0.13
Large (100+) 0.08 1.09 0.09
Total no. firms 123,364 17,117 184,335 Source: Rwanda Establishment Census (2011); Zambia Economic Census (2011); Uganda Census of Business Establishments (2011).
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Regional concentration of industries
Since economic activities are lumpy by nature and spatial organization is likely to be
geographically uneven, a true measure of spatial concentration should be able to identify
if clustering is taking place above and beyond what we would be observed if firms simply
chose their locations randomly. Such a measure should control for the size distribution
of establishments among industries so that industries with only a handful of firms do not
appear to be unusually clustered. The Ellison Glaeser (EG) index (Ellison and Glaeser,
1997) accounts for these issues and helps us identify if economic activities within a city
are clustered in a particular place, fostering agglomeration economies. This measure
takes a value close to zero when the distribution of firm locations is similar to what would
have occurred if locations were chosen randomly. Therefore, a nonzero, positive value
implies agglomeration or clustering above and beyond what would have been observed
if the plant’s location were randomly selected. Results from the United States show that
an industry is highly concentrated if the EG index is larger than 0.05, moderately
concentrated if it is between 0.02 and 0.05, and not concentrated if under 0.02.
During the early stages of industrialization, most industrial activity is clustered around large cities and along transport corridors (Lall, Schroeder and Schmidt, 2008). Mapping firms in the tradable sector in Kigali (Figure 1-11) onto the city roads network shows the same pattern. By contrast, in the retail sector, a lion’s share of firms are spread out across the city in areas where population density is the highest (east of the CBD).
TRADABLE SECTOR FIRMS NON-TRADABLE SECTOR FIRMS FIGURE 1-11: FIRM CLUSTERING
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FIGURE 1-12: KERNEL DENSITY OF RETAIL AND MANUFACTURING FIRMS IN KIGALI
Across Africa, the retail trade industry employs the most number of workers. Downtown
Kigali is dominated by such retail firms. Among the 37% of workers employed in this
sector, the majority work in non-specialized stores of food and beverages, which account
for 9% of the total labor force in Kigali. The top 10% most concentrated sub-sectors in
both cities are presented in Table 1-5. Firms in these sub-sectors are mostly involved in
tradable activities such as manufacture, quarrying and agriculture, as well as some
tradable services such as printing. But the tradable sector firms account only for 14% of
firms in Kigali. These few firms, however, employ 32% in Kigali. The ratio of firms to
employment is therefore much higher in the tradable sector, which African cities should
support to create jobs.
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TABLE 1-5: MOST CONCENTRATED INDUSTRIES IN KIGALI
Four-digit industry code Share of firms
Share of labor
EG index
Manufacture of other transport equipment n.e.c. 0.01% 0.03% 1.01
Sawmilling and planting of wood 0.39% 0.45% 0.64
Administration of financial markets 0.01% 0.00% 0.62
Residential care activities for the elderly and disabled 0.01% 0.03% 0.58 Forging, pressing, stamping and roll-forming of metal; powder metallurgy 0.04% 0.28% 0.54
Activities of extraterritorial organizations and bodies 0.04% 0.34% 0.48
Retail sale of tobacco products in specialized stores 0.01% 0.01% 0.42
Cultural education 0.03% 0.07% 0.41
Security and commodity contracts brokerage 0.18% 0.27% 0.40
Wholesale of agricultural raw materials and live animals 0.01% 0.00% 0.36
Finishing of textiles 0.02% 0.67% 0.35
Retail sale of textiles in specialized stores 1.21% 0.59% 0.34
Manufacture of articles of concrete, cement and plaster 0.02% 0.04% 0.30
Manufacture of other food products n.e.c. 0.03% 0.44% 0.27 Renting and leasing of other personal and household goods 0.30% 0.17% 0.27
Operation of sports facilities 0.02% 0.01% 0.25 Retail sale of books, newspapers and stationary in specialized stores 0.75% 0.63% 0.25 Social work activities without accommodation for the elderly 0.01% 0.05% 0.24
Wholesale of textiles, clothing and footwear 0.14% 0.12% 0.22
Non-specialized wholesale trade 0.01% 0.02% 0.22 Accounting, bookkeeping and auditing activities tax consultant 0.47% 1.02% 0.22
17
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18
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on the Provisional Results.
National Institute of Statistics of Rwanda. 2014. Fourth Rwanda Population and Housing
Census, Rwanda, 2012: Final Results: Main Indicators Report.
Rosenthal, S. and W. Strange. 2004. “Evidence on the Nature and Sources of
Agglomeration Economies”. ch. 49, p. 2119-2171 in Henderson, J. V. and Thisse, J.
F. eds., Handbook of Regional and Urban Economics, vol. 4, Amsterdam: Elsevier.
Syverson, Chad. 2004. "Market Structure and Productivity: A Concrete Example". Journal
of Political Economy 112 (6): 1181-1222.
United Nations United Nations Commodity Trade (UN Comtrade). 2015. Statistics
Database. http://comtrade.un.org/db/.
United Nations, Department of Economic and Social Affairs, Population Division. 2015
World Population Prospects: The 2015 Revision, New York.
Venables, A. 2015. “The Developing City: Urban Form and Function,” Unpublished paper,
University of Oxford.
World Development Report 2010. 2009. Washington, D.C.: World Bank.
19
Governance
2.1 Brief History
Modern Rwandese history is generally structured around four major time periods: 1) pre-
colonialism; 2) the colonial period from 1897 to 1959; 3) the 1959 revolution up to the
1994 genocide; and 4) 1994 to the present day. Important historical events occurred
during each of these periods which affected how land rights evolved in Rwanda.
Examples of such historical events include the transition (of most of the country) from an
inheritance-based land rights system to one based on land allocation by the king; the
transition from German to Belgian colonial rule; the 1973 coup d’état by Habyarimana;
the civil war beginning in 1990; and the arguable transition from a post-conflict state to
a developmental state around 1997.
During pre-colonial times, Rwanda was ruled by a Mwami (king), who was officially
regarded as a divine ruler. The (Tutsi) Mwami was head of the royal court. Most Bahutu5
and Batwa6 were peasant farmers and hunter-gatherers, respectively.
In the earlier days of the Mwami, the power structure below the king was relatively
balanced between Batutsi 7 and Bahutu chiefs and nobles. Until the late eighteenth
century, a system of land ownership based on inheritance (ubukonde) meant that (thanks
to their greater number and earlier arrival in Rwanda) many landed chiefs were Bahutu,
and semi-independent. The Mwami’s court of advisors (abiiru) were also exclusively
Bahutu and had considerable influence until the mid-18th century after which they
became gradually side-lined.
The trend was towards a centralisation of power with the (Tutsi) Mwami and his
favoured Batutsi nobles. In Southern, Eastern, and Central Rwanda, the ubukonde
inheritance-based system transitioned to a system of land ownership and assignment by
the King directly (igikingi) (Mamdani, 2002, p. 66). This transition was initiated by
Mwami Yuki Gahindiro (1746-1802) and implemented progressively until colonial times,
although the ubukonde system remained entrenched in the North and North West.
Igikingi land tended to be large tracts of grazing land, allocated to nobles or war heroes
deemed loyal to the Mwami (Burnett, J.E., 2016).
Under igikingi, Bahutu peasants were granted access to their former land only in return
for significant corvée (forced) labour (uburetwa) for one to three days out of every six,
and/or large portions of their grain harvests. Many ‘petit Tutsi’ were also peasants in
precolonial times, although they were exempt from this uburetwa.
Recipients of igikingi land were not entirely secure in their land rights. The Rwanda
Institute for Sustainable Development (RISD) report that: “If the holder of an igikingi lost
5 The plural form of hutu. 6 The plural form of Twa. 7 Plural of Tutsi.
20
favour with the chief or lost his cattle through disease, mismanagement, or raiding, the
chief seized his igikingi from him and gave it to someone else who had cattle. The
recipient of an igikingi was expected to make regular gifts to the chief or mwami who had
bestowed the igikingi on him.” (Burnett, J.E., 2016).
Rwanda was a German territory from 1885 until 1922. The Germans’ colonial
involvement was relatively light, and traditional power structures were mainly upheld.
In 1916, a League of Nations mandate requested Belgium to govern the modern
territories of Rwanda and Burundi as Ruanda-Urundi, in addition to its existing colony
the Belgian Congo (which would later become the Democratic Republic of the Congo).
From 1922 to 1945, Rwanda was ruled by Belgium under a much more involved style of
colonialism, which nonetheless upheld the preceding rule of the Mwami and many
Batutsi. The Belgian colonisers in fact severely increased the exploitation of Bahutu,
intensifying the demands of uburetwa forced labour, and forcing people to formally
identify as Tutsi, Hutu, or Twa on National Identification cards. The Belgians also sought
to increase the local production of staple foods, introducing cassava, maize, and Irish
potatoes, but nevertheless, Rwanda suffered two major famines under Beligan rule: once
in 1928-29, and again in 1943-44. In the latter, one fifth to one third of the population
died, and large proportions of the population migrated to the Belgium Congo (Burnett,
J.E., 2016).
Under colonial times, a system of formal land titles was introduced, but these titles were
only accessible to white settlers and Africans who met the colonists’ criteria of being
‘civilised’ which was mostly restricted to a few traders who originated from outside of
Rwanda (even the Mwami did not qualify as ‘civilised’) (Burnett, J.E., 2016). Meanwhile,
with military backing from the German and then Belgian colonisers, the Mwamis began
to take greater control of the Northwest, and, during the 1930s, Mwami Yuhi Musinga
declared that igikingi inheritance would also apply in those regions. Following this
proclamation, he assigned much of the former ubukonde land there to chiefs from the
central royal court. During the early 1950s, Mwami Mutara Rudahigwa abolished the
ubukonde inheritance system completely, and forced all former ubukonde chiefs to share
their land with those who had been using it. The (majority) igikingi land was not affected
although ubuhake – a system whereby Bahutu peasants used Batutsi cows in return for
service—was abolished.
Over the course of the 1950s to 1960s, some areas also implemented a new “paysannat”
system, whereby sparsely populated land was allocated to peasants who lived in row
housing along a road, near to a contiguous piece of farmland. Paysannat land usually
included individual plots but sometimes communal land as well. Recipients faced certain
requirements in order to keep their land. For example, they were required to cultivate
coffee and not subdivide the land. However, these conditions were not often upheld.
Paysannat was only implemented in selected areas, due to its high costs (financed initially
by the Belgian government), and the need for low population density. Indeed, during the
same period, and increasingly into the 1980s, population growth was putting
21
considerable pressure on land prices, enough that many people moved from the fertile
West and North to the East where soil quality - but also land prices and population density
– were lower.
The abolition of ubuhake and implementation of paysannat took place in an environment
where colonial authorities and the Catholic Church were becoming increasingly more
sympathetic to the Bahutu people. Towards the end of the colonial period, the Church
begin to advocate on their behalf for greater economic and social welfare and, perhaps
most important, for their political empowerment. A Bahutu elite slowly began to form.
This elite—which was led by Grégoire Kayibanda who would later become Rwanda’s first
elected President—began demanding more power. While some Batutsi rulers were
sympathetic to these calls and ready to integrate Bahutu, many were not. Those opposed
to their integration, wanted to ensure that Rwanda’s political institutions kept them
excluded from positions of power. The result was two increasingly opposing factions: 1)
the Bahutu (both moderate and militarised) and Batutsi (moderate) factions who
favoured increased or total Hutu political power; and 2), those who wished to retain the
existing power structures in which Batutsi dominated. The first faction—those who
supported an increase in Hutu political power— received considerable support from the
Belgian colonial rulers.
These tensions culminated in the anti-Tutsi ethnic violence and intimidation which took
place in Rwanda during 1959 to 1962. During this time, Batutsi were beaten, had their
homes burned and, in some cases, were massacred. The spark that lit the fire of ethnic
violence was the beating of Dominique Mbonyumutwa, a popular Hutu Major, by a group
of Batutsi youth in the Southern Province. It is estimated that 20,000 to 100,000 Batutsi
were killed following his death, and approximately 150,000 (including the Mwami) fled
to Uganda and, to a lesser extent, South Kivu province of the Belgian Congo during the
violence.
The Bahutu who held land in the Northwest under ubukonde used the unrest to take back
land from the Batutsi chiefs who had been installed by Mwami Yuhi Musinga. In 1960, an
administrative decree declared the end of the igikingi system of land tenure. A year later,
the ubukonde system was also abolished under a ruling that gave former clients rights of
ownership to the land they worked. In practice, clients still needed to pay annual rents to
the former landowner but their rights to the land were now more secure.
Those Batutsi who remained after the ethnic violence were largely excluded from power.
In 1960, Belgian colonisers oversaw elections that returned a new generation of Bahutu
representatives (owing to the now overwhelmingly Bahutu population). A 1961
referendum abolished the monarchy, and Dominique Mbonyumutwa was selected by the
new ruling (pro-Hutu) party to act as provisional President until October, at which point
Grégoire Kayibanda was elected.
The underlying sentiment was that the majority populace of Bahutu should have greater,
or complete, self-rule. This culminated in not only anti-Tutsi sentiments but also anti-
22
colonial sentiments. In 1961, following a referendum, Belgian granted Rwanda its
independence.
Grégoire Kayibanda’s rule continued to exclude Batutsi from positions of power, and also
introduced ethnic quotas for workplaces and schools, which had previously encompassed
more Batutsi relative to their proportion of the population as a whole. This led to
thousands of Batutsi children being excluded from schools, and Batutsi adults losing their
jobs and becoming trapped in unemployment.
In 1973, Gregoire Kayibanda was overthrown by Juvenil Habyarimana in a coup d’etat.
Habyarimana remained President (through rigged elections) until 1994. Habyarimana
founded the Mouvement National Révoluntionaire pour la Développment, which he
established as Rwanda’s only legal party until 1990.
President Habyarimana faced the difficult question of whether and how to reintegrate the
refugees who had fled the country back into Rwanda. He used land scarcity as an excuse
for not doing so, arguing that many of the plots they had left behind were now being used
by others. In 1990, the Rwandan Patriotric Front (RPF)— an army of Batutsi refugees
who had been residing in Uganda since they fled Rwanda during 1959 to 1962) invaded
Rwanda to claim back their land and country.
The war continued until 1993, when the RPF and Rwanda’s existing ruling elite signed
the Arusha Accords in which both parties agreed to power sharing. In practice, this power
sharing agreement was not realistic as there were many hard line members of the existing
elite who were not ready to rule alongside the RPF. In 1994, the genocide against the
Batutsi began and lasted 100 days, until the RPF took control of Kigali.
The war and genocide had important implications for land allocation. Firstly, after the
RPF’s victory, two million Rwandese fled Rwanda to refugee camps in Tanzania and the
Democratic Republic of Congo (DRC). The RPF announced in 1994 that all Rwandese
people living outside of Rwanda should return, leading to an estimated return of 800,000
refugees between 1994 and 1996. In 1996-7, another 1.2 million refugees returned from
camps in Tanzania and the DRC. These outflows and influxes of people created large
uncertainties over land allocation.
It was at this point that the government and donor community began to advocate
imidugudu—that is, grouped rural settlements— in order to densify the use of rural land.
By 1996, the government had ruled that imidugudu was the only permissible form of rural
settlement although this was never enforced. Grouping rural settlements is still an aim of
the government today, and some progress, but not much, has been made toward this end.
Today the government plays a central role in land allocation through a variety of
mechanisms including the creation of zoning regulations, master plans, and building
codes and by overseeing land titling, the land registry, and any land disputes which arise.
23
2.2 Centralized Governance
Historically, power in Rwanda has tended to be concentrated with the President (or
Mwami) although the country has a long history of village-level governance as well.
During colonial times, the colonial rulers recognised Rwanda’s strong government, and
opted to use it rather than replace it. Colonists encouraged an intensification of
centralization, seen through examples like the issuing of identity cards, the significant
increase in the demand of uburetwa labour, and military support to the Mwami.
This pattern of centralized rule continues to the present day. A recent example is the
government’s decision in 2014-15 to centralize the collection of local revenues at the
national Rwanda Revenue Authority (RRA) rather than have districts collect their own
revenues. While the revenues still ‘belong’ to the districts from which they were
collected, it is hoped that this move will increase efficiency, thereby increasing the
amount of resources which districts have at their disposal. Districts remain responsible
for spending these revenues on local public goods. In addition, districts can take out loans.
References
Burnet, J.E. 2016. “Women’s Land Rights in Rwanda,” Rwanda Institute for Sustainable
Development (RISD), online article, http://risdrwanda.org/spip.php?article74.
Mamdani, M. 2002. “When Victims become Killlers: Colonialism, Nativism, and Genocide
in Rwanda,” Princeton: Princeton University Press.
http://risdrwanda.org/spip.php?article74
24
Land
3.1 Land Ownership
Following a major land registration and titling effort begun in 2010, the majority of land
in Rwanda is now owned privately and formally. In addition to private land, the
government owns public land which is used for government activities (e.g., ministries,
the National Convention Centre, District offices, schools, hospitals, etc). It also owns any
confiscated land that exists, and the country’s wetlands which represent about 11% of all
land in Rwanda) (USAID, 2015a). Citizens are entitled to use government land through
land lease agreements, such as the cooperatives who farm rice in government-owned
valley bottoms.
For those who hold land in the private domain, it is possible to co-own plots of land as
the title identifies the percentage of land which is held by each party. A subdivision law,
however, forbids the subdivision of large parcels of land and, as a result, the number of
names on a land title can be multiple.
3.2 Land Disputes
Article 159 of the Constitution of Rwanda, which was adopted 26 May 2003, demands
that local mediation committees be established for pre-court resolutions of disputes, and
their foundations have been subsequently established in an Organic Law 17/2004 of
4/05/2004. Changes were made to the regulation of the abunzi in 2006, 2010, and 2015
(Government of Rwanda, 2006, 2010, 2015).
Disputes over land ownership (which cannot be settled through informal means) are
initially brought to the village leader. If the village leader is unable to settle the issue, the
case is then taken to the village’s mediation committee, called the “abunzi,” which is a 12-
person committee elected by villagers. While members of the “abunzi are not paid, their
rulings are enforced by local authorities.8 Three abunzi, who are selected by the disputing
parties, hear each case. The majority vote of the abunzi is the final ruling. A disputant may
appeal this ruling by taking his or her case to the sector-level abunzi (Government of
Rwanda, Ministry of Justice, 2016). If the decision of the sector-level abunzi is also
contested, the disputant may take it to a formal court as long as he or she files a request
within one month of the ruling. The vast majority of cases taken to abunzi mediators
involve land. However, this system of mediation is quite effective as only about 10% of
cases go on to the formal court system (Government of Rwanda. 2014).
8 Cases which are between people from different districts go straight to the courts.
25
3.3 Land Transfer
The current procedures for registering and transferring land were encoded in Ministerial
Order Number 002/2008 of 01/4/2008, Section II. To purchase land, the buyer and seller
must visit their sector land office, with at least one witness for each party, and present
several documents including the current land title (and copies), a written contract, a
statement from the Revenue Authority that all property taxes are paid to date, their
Identification documents (and copies), and a handover form (provided by the land office).
In addition, some offices require the parties to complete the form on a computer rather
than by hand and 27,000 francs for administrative fees. In theory, the land title is then
transferred in one to two weeks although there has yet to be a robust study on the waiting
times in practice. These procedures are published, or can be explained in person, at each
sector land office.
All formal land titles are recorded in the national land registry. For each registered plot,
this database includes a Unique Property Identification (UPI) number, a map of the
boundaries, and basic details about the owner (usually their Tax Identification Number
and phone number). The land registry can be publically viewed at the sector land office.
In recent years, the government has made considerable efforts to communicate land laws
and procedures clearly to the population. It has held two “Land Weeks” in order to explain
the current land laws and procedures in more than 100 sectors which were visited in
both 2014 and 2015 ("RNRA News Details" 2016). Monthly announcements have been
made at umuganda meetings that are held in all villages in Rwanda and which all villagers
must attend. In addition, sector land managers receive considerable training and
encouragement to educate people in their sector about land laws and procedures.
However, there is ample evidence that many citizens still do not fully understand the
laws, and/or simply do not take the steps necessary to protect their land rights. The
Rwanda Natural Resources Authority (RNRA)’s Department of Lands and Mapping, for
example, reports that in 2014, 75,353 land transactions were recorded in their database
(and hence properly registered), but estimate that this is approximately one third of the
total transactions carried out in that year ("RNRA News Details" 2016).
For many low income citizens, the 27,000 fee, plus the fees needed to pay for document
photocopies, and witnesses9 are prohibitive. It is likely that many lower income citizens
do not fully understand their property tax obligations, and may struggle to obtain a tax
clearance form due to transport costs, tax costs, and a poor understanding of the
importance of a property title. Although there has been no formal survey, it is believed
that many land parcels are transferred without changing ownership in the land registries.
9 It is not unusual for buyers and sellers to pay the transportation costs to the land registry and a small fee to their witnesses.
26
3.4 Land Regulations and Zoning
Currently, there are only three inspectors employed by Kigali City to police land use,
making effective monitoring impossible. While each sector has a land office, there have
been reports that some bribing of land officers occurs. Ambitious land use plans and
building codes often don’t match people’s incomes and market signals, which further
increase noncompliance.
Several institutions are involved in deciding how land is used. Municipal governments
(like the City of Kigali) are responsible for creating city-level Master Plans and zoning,
issuing permits, and policing land use. The Rwanda National Resources Authority is
responsible for creating Land Use Plans for every city, outlining how each area is to be
developed and managed. The Ministry of Infrastructure plans infrastructure (including
setting standards), and also establishes building codes (through its sub-agency the
Rwanda Housing Authority). At present, coordination and coherence between these
respective plans and policies is not strong. Currently, there are plans by the government
to review all land regulations and redraft them to improve consistency, as well as
responsiveness to market signals.
3.5 Mortgage Markets
Commercial banks offer loans, but only for customers with higher-value land or
properties. There are many barriers to obtaining a mortgage including relatively high
interest rates (set at approximately 17% between 2012 and 2015) (National Bank of
Rwanda, 2015), large deposit requirements, and 10 to 15 year payback periods. As a
result, mortgages are inaccessible for the bulk of the population. Just 8% of Rwandans
have any outstanding loans from a commercial bank (NISR, 2015).
Similarly, just 8% of households have accessed loans using land as collateral. While it was
hoped that the 2010-12 land tenure regularisation drive would increase poor families’
abilities to access loans, there is little evidence that this has happened. Low uptake may
be due to the fact that few commercial loans are tailored for low income clients and few
microfinance banks have designed housing loans. One microfinance bank, Urwego
Opportunity Bank (UOB), began offering housing loans to business clients in January
2015, but this product has not yet been taken up en masse. So far, there is no nationally
representative data available on the proportion of households using land as collateral
since regularization was completed in 2012. It should be noted that a formal land title is
not always required in order to access housing finance as several other types of finance
are available without the use of a land title as collateral. The most common form of
finance is obtained through informal networks where a title is less important.
3.6 Tenure Security
Once land is titled, it may be seized legally only by the government, and only “in the public
interest and with prior and just compensation.” The law on expropriation (Law Number
27
18/2007 of 19/04/2007 Relating to Expropriation in the Public Interest) states that
compensation should be paid within 120 days of the agreement of the price (Article 24).
If payment is delayed, the expropriator must add 5% interest for every year (which must
not exceed two years) (Article 28). The law also states that land and buildings shall be
reimbursed at market rates (Article 22) but does not state how the valuation is to be
carried out.
A recent USAID study finds that, until 2009, officials “calculate[d] the price to be paid by
making an average of comparable sales” (USAID, 2015b). Such sales data, however, were
likely to be unrepresentative of the market value of confiscated land as records at the
time were not kept centrally and digitally. The study reports that the prices paid under
this system were deemed too high by the government.
In 2009 (and then 2010 for areas outside Kigali), a Ministerial Order established prices
which were to be applied for land in cases of expropriation. Many believe that these prices
are now out of date and too low, given the rapid rise in land and housing prices in Kigali.
The law, however, fixed prices for an indefinite periods and, as yet, there has been no
provision for updating prices.
In 2010, a professional institution for property valuers (the Institute of Real Property
Valuers of Rwanda- IRPV) was established by law (Law 17/2010 of 12/05/2010
Establishing and Organising the Real Property Valuation Profession in Rwanda). All
property valuers must register with this institution, and the institution’s Council
(comprised mostly of government representatives from other institutions involved with
land) must approve all valuation laws and policies, as well as accepting or rejecting
applications for membership of IRPV (Republic of Rwanda, 2010). Although the 2009/10
Ministerial Orders establishing land and property prices were never repealed, the same
USAID study reports that most expropriating entities now hire a professional valuer from
IRPV, under a process of competitive bidding.
Evidence suggests that the same is not true at the district level where valuation continues
to be undertaken by different entities. According to the same USAID (2015b) report,
district officials told researchers that for district-initiated projects, some districts employ
independent valuers, others use District land/infrastructure/agronomist officers, and
others set their own land prices through the District Advisory Council. Some districts also
combine approaches, especially using “independent valuers on large projects and District
staff on small projects”. In Districts that set their own land prices, “even when
professional valuers are hired, they are required to base their valuations on these locally-
set prices.” USAID’s findings about the proportion of properties valued under different
methods, by year, according to reports of the former property-owners, are reproduced
below:
28
FIGURE 3-1: PROPERTY VALUATION IN RWANDA Source: USAID, 2015b.
USAID also cited “pressure… from expropriating entities which seems to have led some
valuers to match the prices with the wishes of the expropriating entity” (USAID, 2015b).
The study found the final amount paid to expropriated property owners varied
considerably based on the expropriating entity and the purpose of the expropriation.
Their findings regarding mean expropriation per square metre, by expropriating entity
and purpose of expropriation, are shown below:
FIGURE 3-2: PROPERTY COMPENSATION IN RWANDA
Source: USAID, 2015b.
29
The 2007 expropriation law also states (Article 26) that “if the expropriated person is not
happy with the value determined for compensation, he or she can pay for an alternative
valuation to be made,” although the cost of these valuations may be prohibitive, and it’s
not clear in which circumstances, if any, their findings would be binding for the
government.
USAID’s team interviewed over one thousand people whose land had been expropriated
or was about to be expropriated. They found that around one quarter to half were not
informed about how their properties would be valued before work was begun, and that
the likelihood of receiving this notice varied a lot by the type of project implemented.
Their summary table is reproduced below (USAID, 2015b).
FIGURE 3-3: INFORMATION SOURCES IN THE VALUATION PROCESS Source: USAID, 2009.
References
Government of Rwanda. 2006. Organic Law No. 30/2006 of 14/08/2006 Modifying and
Complementing Organic Law No. 14/2004 of 26/04/2004 Establishing General
Provisions Governing Public Institutions to date, accessed from
http://ombudsman.gov.rw/Documents/16.08.06%20itegeko%20rigenga%20Ko
mite%20z'abunzi.pdf
Government of Rwanda. 2010. Organic Law No. 02/2002/OL of 09/06/2010 Modifying
and Complementing Organic Law No. 14/2004 of 26/04/2004 On Organisation,
http://ombudsman.gov.rw/Documents/16.08.06%20itegeko%20rigenga%20Komite%20z'abunzi.pdfhttp://ombudsman.gov.rw/Documents/16.08.06%20itegeko%20rigenga%20Komite%20z'abunzi.pdf
30
Jurisdiction, Competence, and Functioning of the Mediation Committee, accessed
from
http://www.minijust.gov.rw/fileadmin/Law_and_Regulations/Itegeko_ngenga_a
bunzi_2010.pdf
Government of Rwanda. 2014. “President Kigame Joins Abunzi to mark ten-year
Anniversary of Mediation and Justice,” 17 October 2014, online article accessed
at
http://www.gov.rw/newsdetails2/?tx_ttnews%5Btt_news%5D=236&cHash=8b
a2f74cb8a660305989d35007718596
Government of Rwanda. 2015. Organic Law No. 02/2015/OL of 16/07/2015 Modifying
and Complementing Organic Law No. 02/2002/OL of 09/06/2010 On Organisation,
Jurisdiction, Competence, and Functioning of the Mediation Committee, accessed
from
http://www.minijust.gov.rw/fileadmin/Laws_and_Regulations/ABUNZI_NEW_L
AWS.pdf
Government of Rwanda. 2016. Ministry of Justice. “Mediation Committee,” online article
accessed at http://www.minijust.gov.rw/services/abunzi/
National Bank of Rwanda. 2015. Lending Interest Rate By Bank From 8Th December
2014-11Th January 2015 Final. 2015. PDF.
http://www.bnr.rw/index.php?id=329
National Institute of Statistics of Rwanda (NISR). 2015. Rwanda Poverty Profile Report -
Results of the Integrated Household Living Conditions Survey (EICV4)
http://statistics.gov.rw/file/4135/download?token=cylGgLRl#
Republic of Rwanda. 2010. Official Gazette N° 20 Of 17/05/2010.
http://www.minirena.gov.rw/fileadmin/Land_Subsector/Laws__Policies_and_Pr
ogrammes/Laws/Valuation_law_Gazetted_on_17.05.2010.pdf
Rwanda Natural Resources Authority. 2016. "RNRA News Details".. Rwanda Natural
Resources Authority.
http://rnra.rw/index.php?id=51&tx_ttnews%5Btt_news%5D=255&cHash=f3c7
71eca93907ab32a284a91a48209a
USAID. 2015a. Land Project Quarterly Newsletter, October 8, 2015, Volume Four, Issue
One, accessed from http://www.rwandaland.org/en/usaid-land-project/latest-
quaterly-
newsletter/item/download/148_0fe57b09c38c571e249fc2678c50312c
USAID. 2015b. “Implementation of Rwanda’s Expropriation Law and Outcome on the Population”. USAID
http://www.minijust.gov.rw/fileadmin/Law_and_Regulations/Itegeko_ngenga_abunzi_2010.pdfhttp://www.minijust.gov.rw/fileadmin/Law_and_Regulations/Itegeko_ngenga_abunzi_2010.pdfhttp://www.gov.rw/newsdetails2/?tx_ttnews%5Btt_news%5D=236&cHash=8ba2f74cb8a660305989d35007718596http://www.gov.rw/newsdetails2/?tx_ttnews%5Btt_news%5D=236&cHash=8ba2f74cb8a660305989d35007718596http://www.minijust.gov.rw/fileadmin/Laws_and_Regulations/ABUNZI_NEW_LAWS.pdfhttp://www.minijust.gov.rw/fileadmin/Laws_and_Regulations/ABUNZI_NEW_LAWS.pdfhttp://www.bnr.rw/index.php?id=329http://statistics.gov.rw/file/4135/download?token=cylGgLRlhttp://www.minirena.gov.rw/fileadmin/Land_Subsector/Laws__Policies_and_Programmes/Laws/Valuation_law_Gazetted_on_17.05.2010.pdfhttp://www.minirena.gov.rw/fileadmin/Land_Subsector/Laws__Policies_and_Programmes/Laws/Valuation_law_Gazetted_on_17.05.2010.pdfhttp://rnra.rw/index.php?id=51&tx_ttnews%5Btt_news%5D=255&cHash=f3c771eca93907ab32a284a91a48209ahttp://rnra.rw/index.php?id=51&tx_ttnews%5Btt_news%5D=255&cHash=f3c771eca93907ab32a284a91a48209ahttp://www.rwandaland.org/en/usaid-land-project/latest-quaterly-newsletter/item/download/148_0fe57b09c38c571e249fc2678c50312chttp://www.rwandaland.org/en/usaid-land-project/latest-quaterly-newsletter/item/download/148_0fe57b09c38c571e249fc2678c50312chttp://www.rwandaland.org/en/usaid-land-project/latest-quaterly-newsletter/item/download/148_0fe57b09c38c571e249fc2678c50312c
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Housing Markets
4.1 Informal Settlements
Because most land in Rwanda is now formally titled, settlements are informal only to the
extent that structures do not comply with building or zoning regulations. The
government’s new Housing Policy (2015) states that the government’s aim is to upgrade
existing settlements by providing infrastructure and support for housing improvements,
and by supporting the market to build tens of thousands of more formal, affordable
houses.
This is not to suggest that slum clearing does not occur. Recently, a small, centrally
located, informal settlement was cleared, and residents were offered subsidized houses
in a more peripheral area of Kigali (“Batsinda 1”). The houses to which they moved cost
approximately 8 million Rwandese francs to construct, but were heavily subsidized as
they were sold to residents at 4 million francs. The cleared area is now also being serviced
with a modern tarmac road.
In addition, a series of low income settlements near Kigali International Airport were
recently cleared to make way for more formal, affordable housing, as well as the
expansion of the airport. In this case, the government expropriated residents’ land,
paying them fees according to the expropriation law.
Recently, the government has stressed that it will adopt settlement upgrading as a
priority for informal settlements. In line with its plans, the World Bank is financing a pilot
upgrading programme in Kigali, which is intended to inform settlement upgrading in the
rest of the country. The programme will focus on improving basic infrastructure in the
target neighbourhood.
4.2 Government Housing Schemes
The government has supported dwellers to upgrade informal houses, in particular by
providing subsidised metals roofs after grass thatch rooves were outlawed.10 To date,
relatively little housing has been ‘built’ or financed by central or local government.
Exceptions are a fairly low-scale pilot ‘Batsinda’ project (targeted at residents who were
resettled following a slum clearance) and some clusters of police housing (both in Kigali).
The government’s construction of the Batsinda houses was financed by the state, with the
houses being purchased at subsidy once they were completed.
In addition, the government has made some efforts to support home purchases. The
Development Bank of Rwanda (BRD) –the Government of Rwanda’s formal investment
arm – offers housing loans with favourable terms (16% interest rates, 20 year period, and
10 The “Goodbye Nyakatsi” campaign.
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10% minimum contribution) for customers with adequate and formal salaries.
Customers of BRD’s “Gira Icumbi” savings account receive further discounted loans (the
lowest rate being 14.5% for those saving in an account for three years or more and whose
deposits equal at least 10% of the value of the loan) (BRD, 2015).
As well as constructing some houses directly, the government provides a broader array
of support through the Rwanda Housing Authority which has acquired land for affordable
housing and has conducted pilot housing construction projects.
The government is also beginning to offer incentives for firms investing in the production
of low-income housing, by fully subsidising the infrastructure in neighborhoods that
satisfy certain affordability criteria. This has already been agreed for a lower-middle-
income housing project being dubbed “Batsinda II”.
Although these construction projects have been small, the state is involved deeply in the
housing and construction market through several avenues. First, the Rwandan pension
fund (Rwanda Social Security Board- RSSB) is one of the largest land-holders in Kigali,
and has invested in the construction of several high end, housing neighborhoods. Second,
there are several construction firms which were established by the government or are
strongly affiliated with the government or ruling party entities. Ultimate Developers
Limited (UDL), for example, is a construction firm in which RSSB is the sole shareholder,
and has undertaken many large projects for the development of high-end, housing
neighborhoods. UDL was previously co-owned by RSSB and an RPF-affiliated holding
company, Crystal Ventures, but RSSB has been the sole shareholder since 2003.
Crystal Ventures is one of the major holding companies in Rwanda, and several of its firms
are main players in the construction market. Crystal is connected to the government both
through a flow of funds to the ruling party, and through more informal collaborations
such as social and collegial ties, and jointly-established missions. Construction firms
within the Crystal ventures holding group include: NPD Ltd, “Rwanda’s leading provider
of civil engineering services, construction products, and construction equipment leases”,
Ruliba Clays, “the largest producer of clay building materials in Rwanda”, Real
Contractors, which deals in construction, engineering and infrastructure.
Another large player in the construction field, Horizon Construction, is part of Horizon
Group, a private firm established by the Ministry of Defence in 2007 and co-owned by a
microfinance cooperative for members of the army and policy (ZIGAMA CSS) and the
Military Medical Insurance Company (MMI). Horizon Construction focuses on roads and
large infrastructure projects, as well as some buildings (such as the Kigali public library).
References
Development Bank of Rwanda (BRD). 2015. “BRD Gira Icumbi Account”. Development
Bank of Rwanda. https://www.brd.rw/?BRD-Gira-Icumbi-Account
https://www.brd.rw/?BRD-Gira-Icumbi-Account
Output Cover PageKigali- A Policy Narrative