Minister of Finance and Economic Planning Yusuf Murangwa has called for a shift in development financing, arguing that countries should focus less on mobilising concessional funding and more on creating conditions that attract private capital at scale. ALSO READ: Nduhungirehe urges knowledge transfer at first South-South, Triangular convention Speaking during a panel discussion on global partnerships for effective development at the Convention on South-South and Triangular Cooperation in Kigali on Tuesday, June 23, Murangwa said traditional development financing models are increasingly insufficient to meet growing investment needs “We cannot remain stuck in what we have been doing before. It is very clear we have to move forward,” he said. De-risking investment Murangwa said one of the biggest opportunities lies in mobilising private capital, which has grown substantially over recent decades but remains largely disconnected from development financing. “The problem with development is that it takes a lot of time. Private capital is not that patient for long-term results,” he said. The minister noted that while governments and development partners face resource constraints, significant private capital exists globally. The challenge, he said, is the mismatch between investors' expectations and the long-term nature of development projects. To address this, Murangwa advocated for blended finance approaches that combine domestic resources, concessional financing and private investment. “What we see is how do we blend resources that can be as patient as possible... to create a cushion for private capital to come in and still get returns,” he said. ALSO READ: Why developing countries are turning to each other for solutions According to Murangwa, such financing structures can significantly increase investment volumes, with one dollar of concessional financing potentially leveraging several dollars in private investment. The minister said Rwanda has increasingly relied on risk-sharing mechanisms, including blended finance structures, public-private partnerships (PPPs), guarantees and sustainability-linked financing frameworks to attract investment into sectors such as energy, housing, infrastructure and financial services. Stability attracts capital Murangwa emphasised that attracting private investors requires more than financing instruments. “The biggest problem is that capital, especially private capital, is very sensitive to the environment where it is going to be employed,” he said. “If the environment is not favourable, private capital runs away.” He identified macroeconomic stability, prudent debt management, fiscal discipline and sustained economic growth as critical foundations for attracting long-term investment. “It has to be on a sustainable level because you have to build a record, and a record that is sustainable,” he said, pointing to Rwanda's long-standing commitment to economic stability and policy consistency. The minister also stressed the importance of understanding investors' expectations and maintaining credible partnerships. “You need to engage the investors, make sure you understand what their concerns are. You have to know what you want as well,” he said. ALSO READ: How Rwanda contributes to South-South cooperation through knowledge sharing Partnerships beyond funding Other speakers argued that development cooperation must increasingly focus on partnerships that unlock investment and deliver measurable impact. Aissa Toure Sarr, the African Development Bank's Country Manager for Rwanda, observed that Africa faces an estimated $400 billion annual development financing gap despite holding roughly $4 trillion in long-term assets and savings. “The problem is the fragmentation of the financing system and architecture on the continent,” she said. She said development institutions should focus on unlocking capital at scale and ensuring every dollar mobilised catalyses significantly larger investments. “We have to make sure that $1 that is raised by the bank may match with $10 from other sources,” Sarr said. Belén Calvo Uyarra, the European Union Ambassador to Rwanda, said effective partnerships are built on trust, accountability and alignment with national priorities. “We are not there just to bring money,” she said. “What we want to achieve is impact and sustainable development.” She described the evolving Rwanda-EU relationship as one based on co-creation and shared objectives rather than traditional aid models. “We move from the aid space to a partnership where we anchor ourselves in your national strategy and build a partnership of joint futures,” she said. Measuring impact, not inputs Andrea Bagnoli, the World Food Programme Country Director, said successful partnerships should be judged by the systems they strengthen rather than the volume of funding they provide. “A good partner is not the one that provides more funding. A good partner is the partner that provides funding that then becomes [a catalyst for impact],” he said. He cited Rwanda's school feeding programme, which grew from a donor-funded initiative supporting 350,000 students into a nationally owned programme reaching about 4.5 million learners.
