Balaam Barugahare, a music promoter and businessman is wrestling with investment troubles in South Sudan.
The Properties worth over $7M are comprised of buildings under his Company, RedBal Investments located in Konyokonyo town of the Capital City Juba. He has appealed to Presidents; Yoweri Museveni and Salva Kiir of South Sudan to save his investment in the world’s youngest nation.
They were constructed on the land he leased from Ramathan with a 25yr lifetime. But to his utter shock, the land lord shamelessly approached him recently and demanded that he part with part of the property or he terminates the contract.
According to the letter seen by this website and authored on September 3rd 2019 by the Uganda Embassy to South Sudan’s Ministry of Foreign Affairs, RedBal Investments Co. Ltd leased the land currently occupying investments worth USD4450, 000 from Fatmah Ramathan Kiir Alla, a South Sudanese for a period of 25 years effective 1st January 2013 to 30th January 2036. But the company’s operations have lately been faced with interferences from the Land Lady even with court pronouncements to the contrary.
After the end of the war in Sudan in 2005 that saw the signing of the Comprehensive Peace Agreement between the then President of Sudan, Omar al Bashir and John Garang, the then leader of the Sudan people’s Liberation Movement, [SPLA], Southern Sudan became semi-autonomous.
The return to peace nudged lots of foreign business people to invest in South Sudan. Those who ventured in South Sudan then, reaped abnormal profits, Balaam inclusive having gone to Juba in 2007, trading in beverages.
“Money got from one trip would be six times the value of one trip. Indeed we made a lot of money. I decided not to repatriate the profits but to reinvest in Juba,” Balaam says.
Starting a factory
After exporting water and beer to South Sudan for some time, Balaam tried to run a water factory in Juba. The hot temperatures in Juba, which soar to about 35 degrees Celsius force people to consume lots of water. It’s estimated that everyday four million bottles of water are consumed in Juba.
So, starting a water factory made a lot of economic sense. However, land in South Sudan belongs to government. People can only takeout leases. It’s also illegal for foreigners to own land.
Therefore, they obtain subleases from lease owners if they want to develop the land. It was under this arrangement that on April 10, 2014, Balaam signed a lease agreement with Ramadan to use her two and half acres for a period of 25 years.
The land on plot N0. 22B is along River Nile in Konyokonyo in Juba town. The agreement states that Ramadan has no right to terminate the contract before the end of the 25 years.
The conflict
The two parties agreed that the monthly rent for the land would be 3000SSP [$1000] per month and after ten years it would increase by 10%. However, by the time they signed the agreement, the exchange rate of the South Sudanese Pound to the dollar was 3SSP for one dollar.
But the continued fighting from the 2013 fallout between President Salva Kiir and his former Vice President Riek Machar deprecated the pound further. By the end of 2017, the pound was trading at about 250 SSP for one dollar. This meant that the 3000SSP that initially fetched $1000 could only fetch 12 dollars now.
But the agreement said the rent fees could only be varied after 10 years. Seeing that she was getting almost nothing from rent, Ramadan changed her mind. She demanded that Balaam instead gives her 50 percent share in the business.
But by this time, Balaam had invested heavily on the land. He had built a multistory building, a warehouse, a water factory, a radio and TV station, the total cost of the investment was close to $5 million. According to the lease agreement, Balaam would surrender the premises to the landlord in good condition and free from any charges or debts of water and electricity at the end of the tenancy.
Asked why he wouldn’t adjust the rent to cater for the inflation, Balaam said it would be hard to vary the rent every time the pound tanked because people’s incomes remain the same.
“The value of goods and money increased, however the income of people remained the same. Public servants sometimes take up to four months before they are paid. Therefore, you can’t keep on adjusting for inflation every time the money drops,” Balaam argues.
He however, said he was willing to negotiate a settlement if the landlady and the military generals were not fronting impossible ideas.
“They wanted 50 per cent share without any contribution yet their land is worth only about UG Shs 100 million. How do you milk a cow you have not fed?” Balaam says.
Balaam ran to court to find redress. The court ruled in his favor but when he obtained a judgement in one court, Ramadan ran to another. When she lost in that court, her military fronts resorted to intimidation.
“They have harassed my general manager, Andrew Leju trying to force him to sign papers selling off my property. Actually last week he was kidnapped and taken to unknown location. The court system has failed to rein in the generals,” Balaam says.
On August 27 2019, Balaam’s company Redbal Investment Ltd wrote to the Embassy of Uganda to intervene.
“We are having a lot of interference from the landlady and her representatives even after she has gone to court and there is an ongoing case yet to be concluded. A couple of times we have asked to settle the issue out of court and made fresh offers to her but it seems her interest is to take the property before the lease ends,” Leju’s letter to the embassy of Uganda reads in part.
The letter was prompted by another from Ramadan’s lawyer earlier in August ordering Balaam to vacate the land within seven days.
“The landlady does cancel all lease agreements which she had signed with you due to her much need of that land at the moment and she would like to exercise her rights on the land for that matter. You are hereby asked to ascertain the remedies for the real damages, which would be caused by the cancellation of all these agreements. The landlady has assigned me to notify you legally that she pledges and bears to pay and recover all the remedies for the real and just damages, which will be caused by her act of cancellation of all signed lease agreements,” a letter from Ramadan’s lawyers of James Paulino Lado and Company Advocates reads in part. It adds that their motivation to cancel the contract emanates from Balaam’s refusal to pay rent from 2017 to 2019 due to disputes on how much to pay.
But Leju’s letter notes that while the company was in the process of computing its investment portfolio, another legal notification was served by another lawyer, Arik Ring Arik on behalf of Gregory Vasilis Dimitri ordering Redbal Investment Co Ltd to vacate the land arguing that they are the new owners having purchased the same from Ramadan.
“On 24 August Arik came with armed men telling us to vacate the plot that they have to take the property. We are writing to the embassy to intervene because our investment is under threat and continuous harassment of our tenants MTN, Andy Studios and Your Best Water Plant. Our humble request is for you to intervene and request the government of South Sudan to protect us from the illegal harassment and threat to our businesses,” the letter to the embassy adds.
On September 3 2019, the Ugandan embassy in Juba wrote to the Ministry of Foreign Affairs of South Sudan requesting it to coordinate with relevant authorities to ascertain and evaluate the complaint and provide a solution. There is no record that the government of South Sudan responded to the request.
“The Landlady with criminal generals are trying to take our businesses. The continued threats have forced me to cry out for help and protection. I have a total of 1,500 workers only 45 are Ugandans. I call upon President Kiir to come out and protect us because we are not only employing many South Sudanese but also paying a lot of money in taxes. If you don’t tell your generals to stop harassing us by trying to grab our hard earned investments, trust me your economy will crumble,” Balaam says.
Contacted for a comment, Ateny Wek Ateny, the spokesperson of President Kiir declined to comment. After listening to the issue, he terminated the call and subsequently refused to pick or respond to our short text messages.
Additional information: Observer Ug
