I wish to react to the article, “Agaciro Fund money invested in high-yielding bonds” (The New Times, November 5). It’s negatively interesting to read that Vianney Kagabo, Agaciro Development Fund’s chief executive officer, says the funds are too small to invest in development projects, yet the government still awaits donations and development funds from abroad to finance the country’s development projects.
It’s also quite worrying that the funds so far collected are being used as speculation means on the money investment market. This is not different from investing on the stock exchange and hoping that the money will bring profits. It could also end up being lost and in the end there might not be any more money to invest in the pending development projects.
Instead of asking for Rwf3, 000 every month from Rwandans, how about starting to invest in the projects and show the results to the Rwandan people and then perhaps the latter will be happy to even contribute Rwf5, 000 a month? How about starting small, say with education projects like schools or student housing, which remains problematic in and around urban areas?
I don’t think this will need very a lot of funds as Mr. Kagabo seems to imply.
I agree. It’s important for Rwandans—who are the main stakeholders—to know that the Fund’s investment in high yield bonds has nothing to do with speculation, but quite the opposite.
This is about as safe an investment as you can get on financial markets, considering that treasury bonds are backed by the creditworthiness of the issuing government, Rwanda’s in this case (not a corporation or a business firm).
As we all know by now, the Government of Rwanda has secured solid ratings from international credit companies, triggering investors’ “frenzy” following the initial Eurobonds issue (largely oversubscribed).
These T-bonds high yields (8-12%) should therefore not be seen as high-risk speculative instruments in a nation where economic growth has averaged 8 per cent over a decade due to sound investment projects in key sectors of the economy (ICT, energy, agriculture).