Forget Chinese investment in Africa, here's a tech partnership in the region you haven't hea

A man consults his mobile phone in the Rwandan capital of Kigali.

Forget Chinese investment in Africa, here's a tech partnership in the region you haven't heard of

By Justina Crabtree, CNBC, Sept. 26, 2017

South Korea is a major foreign investor in Rwanda's blossoming tech scene
The two countries share geographical features and have similar recent histories, which has helped foster a mutual understanding
KT Corporation, the first South Korean company in Rwanda, has plans to use its base in the country as a hub from which to expand further into Africa

While China snakes its influence in technology across the African continent, one of its smaller neighbors has also been making inroads in countries far from home. South Korea, one of the Far East's technological powerhouses, claims to have a stronghold in the central African country of Rwanda.

The unlikely story begins with KT Corporation (KT), a South Korean telecoms giant, which started helping to form the backbone to Rwanda's communications infrastructure a decade ago. The state-owned company currently builds and operates ICT services in Rwanda's public and private markets, and provides a 4G service in partnership with the Rwandan government.

Surprising common ground

Korea re-opened its embassy in the Rwandan capital of Kigali in 2011 after closure due to conflict. "Surprisingly there is a great deal of common ground between the two countries," Lee Dong Ku, deputy chief of mission at the Korean embassy in Rwanda, told CNBC.

South Korea shares a common geography and history with Rwanda which sets the relationship apart from other international players. For starters, both countries are small and mountainous with few natural resources, which in turn means a greater focus on innovation.

South Korea and Rwanda have also both suffered under colonial rule and experienced devastating conflict following independence: the Korean war of the early 1950s and Rwanda's 1994 genocide against the Tutsi tribe. "This shared experience in modern history strikes a chord with Korean people," Lee said.

Rwandans in turn look towards South Korea's "quick recovery from conflict," and "fast-paced socio-economic development," Claudette Irere, director general for ICT at Rwanda's Ministry of Youth and ICT, told CNBC.

According to a profile of Rwanda's ICT sector released in December 2015, the field recorded an average growth that year of 16 percent, steaming ahead of the rest of the economy which grew at 6.9 percent. In 2015, the ICT sector contributed 3 percent to the country's gross domestic product.

Ambitious future plans

Rwanda is ambitious in its development of technology, a key tenet of its Vision 2020 plan launched at the turn of the century to transition the country towards a middle income economy. The Rwandan government has laid at least 4,500 km of fiber optic cable to bring broadband across the country, and aims to produce 100 ICT companies valued at more than $50 million each by 2030.

KT told CNBC that Rwanda is a favorable business environment not least for its promotion of ICT but also its "stabilized government and economic environment" with a low corruption rate in comparison to other African nations.

KT added that it hopes that its base in Rwanda will "act as a regional hub in Pan-Africa business" as the company expands in the region "based on Rwanda's successful case."

South Korea is not the only international player in the Rwanda's technology space, with other foreign investors including India, Japan and South Africa. But according to Irere, South Korean firms are among the top five telecom companies currently in operation and the country is the biggest player in Rwanda's cloud services space.

Then-South Korean President Lee Myung-Bak (R) shakes hands with Rwandan President Paul Kagame (L) during a meeting in Seoul, South Korea, on May 31, 2008.

Iginio Gagliardone, a professor of media studies at the University of Witwatersrand in South Africa, wrote in a 2016 research essay that South Koreans in Rwanda "have been willing to help build, renovate and equip a number of technical and vocational institutes … to facilitate the development of second-tier skills still lacking in the country."

In June 2016, the National Information Society Agency of South Korea signed a memorandum of understanding with the Ministry of Youth & ICT of Rwanda, the agreement pertaining to bilateral cooperation in the technology space.

Rwanda's President Paul Kagame, recently re-elected to the position he has held since 2000, has also visited South Korea three times.

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