By SIMON CIURI
Nakumatt Holdings’ head of strategy and operations Thiagarajan Ramamurthy said in an interview that the retailer could start operations in the two countries as soon as next year, having already identified developers for earmarked premises.
The expansion into Juba and Bujumbura will cost an estimated Sh1.5 billion.
“We have already identified the banks that will finance our expansion. It’s a huge investment that could not have been managed by our internal cash and that’s why we opted to borrow,” said Mr Ramamurthy.
Nakumatt is seeking to export the shopping mall culture to the largely informal retail markets of Burundi and South Sudan, which have low retail penetration and are mainly dominated by mini-marts and kiosks.
Mr Ramamurthy said the retailer is only awaiting completion of the premises before starting operations. “We decided to start our operations afresh because buying an already existing business would come with more costs,” he added.
Nakumatt has just concluded the acquisition of three stores in Tanzania previously owned by South African retailer Shoprite.
The Sh3 billion deal was financed through a KCB loan, but Mr Ramamurthy said the Juba and Bujumbura entry will be funded by international lenders.
“We will work with various international creditors to create a strong pool of resources that will enable us start operations in the two countries concurrently,” said Mr Ramamurthy, who however declined to name the banks that are involved in the transaction.
Ebola empties hotels as Africa borders close (Ebola virus kills off hotel business in Guinea)
By Pauline Bax, Sadibou Marone and Ougna Camara / Bloomberg News
CONAKRY, Guinea — Ibrahima Capi Camara’s phone at the Grand Hotel de L’Independence in Guinea’s capital hasn’t stopped ringing since an Ebola outbreak began last month, for all the wrong reasons.
“At least 80 percent of our reservations have been canceled,” Mr. Camara, general manager of the 217-room hotel in the heart of Conakry, said last week. “Clients are scared to come because of Ebola.”
West Africa is fighting to contain the spread of the disease that has claimed the lives of 111 people in Guinea and Liberia, the worst outbreak in seven years. There is no cure or vaccine for the disease, which kills as many as 9 out of 10 people who contract it. The World Health Organization has warned that the disease will probably continue to spread in the region for a few more months.
This has prompted some West African countries to close their borders in an effort to curtail the spread of Ebola. But measures such as closing borders and restricting travel “don’t make sense,” according to the WHO A more effective way to contain the spread of the disease is for people to avoid close contact with patients already sickened with it, the WHO says.
But this hasn’t stopped Senegal from shutting part of its a border or Ivory Coast from barring buses from Liberia and Guinea.
The disease will curb economic growth in Liberia by slowing cross-border commerce, reducing customs revenue and investment, the country’s finance minister, Amara Konneh, said recently. Gross domestic product will expand 6.8 percent this year, slower than the 8.7 percent last year, he said.
Mohamed Cherif Abdallah, head of the Organized Group of Businessmen in Conakry, said the outbreak is already hurting that country’s economy. Despite having huge mineral reserves, Guinea is one of the world’s poorest nations.
Inadequate health care and a shortage of doctors have made fighting the disease more difficult.
The current outbreak is the first time the disease, identified in 1976 near the Ebola River in what is now the Democratic Republic of Congo, has caused deaths in west Africa. The virus is transmitted to people through blood and other secretions of wild animals, according to the WHO. Humans pass the virus to each other through contact with blood and other body fluids. The disease causes high fever, diarrhea and vomiting, and can lead to internal bleeding.