The social impact of the privatization of Electrogaz on Kigali
Date
2008-03-28T11:57:11Z
Authors
Karamira, Celestin
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Abstract
ABSTRACT
Within the context of neo-liberal globalisation, and the allegation that donor-dependent
countries like Rwanda are obliged to privatise national assets, this study focuses on what
has been the impact of the partial privatisation of the water and electricity utility,
ELECTROGAZ, on the residents of Kigali. In other words, whilst it is accepted that
ELECTROGAZ was badly managed and service provision was poor, other policy options
(such as building state capacity) were not considered. Nevertheless, even if utility
privatisation was ‘forced’ onto Rwanda, the question remains whether its impact was
positive or negative.
Findings of the thesis confirm what Collyer and others claim, namely that utility
privatisation was ‘forced’ onto the government and people of Rwanda, and that this was
sold to the residents as a solution to the bad performance of ELECTROGAZ. Residents
believed government assurances that this was the only option, and initially welcomed
privatisation. However, while some aspects of administration, such as billing and customer
relations have improved, consumers still experience bribery, whilst service delivery has in
fact worsened. Furthermore, tariffs for electricity have increased considerably, and water
tariffs are about to be increased greatly too.
The research shows that it is debatable as to whether service delivery problems are the
fault of the privatised distributor alone, or the government as the producer. Nevertheless,
poor service delivery coinciding with tariff increase lends support to the view that the first
priority of privatised entity is profit and not the welfare of citizens.