Rwanda has defended its decision to spend $40 million on advertising with British soccer team Arsenal after coming under criticism. The East African nation relies on foreign aid for a significant portion of its budget.
Rwanda’s tourism authority argues the initiative is part of larger drive to double visitor revenue. And when the English premier league football season kicks off in two months, the Arsenal football club jerseys will have a “visit Rwanda” logo on the sleeves.
The three-year deal cost Rwanda about $40 million, sparking criticism of the national tourism agency. The East African nation receives $80 million a year in assistance from the United Kingdom. About 17 percent of Rwanda’s budget comes foreign aid, although government officials say that is down from about 80 percent 15 years ago.
The agency said the Arsenal deal is part of its campaign to double tourism revenue to $800 million a year. Tourism employs more than 100,000 Rwandans.
The agreement can be good in the short-term, said Kwame Owino, the head of the Institute of Economic Affairs.
“40 million dollars for Rwanda like any other African country is a significant sum,” Owino argued. “But given the calculation they are making about what its yield would be for tourism, it’s something that can be measured. Three-year medium-term agreement is a good one because at the end of it they may have to evaluate how productive that has been whether it met its objectives.”
Gerrishon Ikiara, an international economic affairs lecturer at the University of Nairobi, said unlike some African countries, Rwanda is not afraid to take risks when it comes to business.
“Within East Africa, it’s one of the smallest economies but it liberalized before many others allowing, free entry of goods and services,” said Ikiara. “And the country has been experiencing one of the highest growth rates in the region, when many people fear that if you open up as an African country and a small country within East Africa compared to Kenya and Tanzania that you are making a big mistake. But it has worked very well for Rwanda.”
The World Bank says at least 60 percent of Rwandans live in extreme poverty. The government aims to change that by pushing economic development and moving from a low-income economy to a middle-income one by 2020.
Still, Owino said spending millions of dollars in sponsorship deals while many people go to bed hungry may worry some people.
“In terms of perceptions, it may look like people in the government of Rwanda have their heads in the clouds and they are trying to do posh things when people in their own country may even lack basic necessities,” said Owino. “So I think that’s a big risk. The second risk is that it may not work in the sense that you may pay but there is no guarantee of yielding tourism especially whether English people or from other parts of the world where people watch Arsenal football club.”
In 2013, Tanzania signed a sponsorship deal with another English club Sunderland. According to the Tanzania’s tourism board, visitors numbers have doubled 1.2 million visitors. Rwanda hopes when its Arsenal deal expires in three years the country will have generated similar growth.
Source: Voice of America