Rwanda and the European Union (EU) have signed a €40 million (approximately Rwf67 billion) financing agreement to support the transformation of the country's agriculture into a modern and climate-resilient sector. ALSO READ: Government revises irrigation targets The five-year agreement was signed by the Minister of Finance and Economic Planning, Yusuf Murangwa, and EU Ambassador to Rwanda, Belén Calvo Uyarra. Dubbed HANGARIBIHE: Transformational Climate-Smart and Inclusive Agriculture in Rwanda, the programme comprises €36 million in budget support and €4 million for technical assistance, capacity building and technical studies. The programme forms part of the Team Europe Initiative on Investing in Sustainable and Inclusive Agricultural Transformation, which brings together the EU and its partners to support Rwanda's agricultural development. The funding will contribute to the implementation of Rwanda's Second National Strategy for Transformation (NST2) and the Fifth Strategic Plan for Agriculture Transformation (PSTA5). Under NST2 (2024-2029), the government aims to modernise agriculture by making it more market-oriented and productive. The strategy targets a 50 per cent increase in agricultural productivity and an annual sector growth rate of six per cent. ALSO READ: 7 firms to invest over Rwf50bn in Gabiro Agribusiness Hub It also seeks to expand irrigated land from 71,500 hectares to more than 132,000 hectares by 2029. The new financing will support increased investment in agriculture, expansion of irrigation infrastructure, sustainable land management, strengthened climate resilience, restoration of degraded ecosystems, and improved climate information systems to support evidence-based decision-making. This financing agreement is a strategic partnership for Rwanda's agricultural transformation, Murangwa said. It will help build a modern, productive and climate-resilient agricultural sector by driving inclusive productivity gains for smallholder farmers, cooperatives, women, young people and small and medium-sized enterprises, while promoting climate-smart and sustainable farming practices. ALSO READ: Call for more support to women farmers He said the funding would be disbursed in phases between 2026 and 2029, subject to satisfactory progress in implementing the agreed conditions. The EU ambassador described the programme as a reflection of the European Union's shared commitment to sustainable and resilient agricultural development. “We are very pleased that, through this programme, we are strengthening the climate dimension of our cooperation and our shared ambition to advance both the climate agenda and the agricultural sector,” Uyarra said. “This programme demonstrates our confidence in the vision embedded in Rwanda's National Strategy for Transformation and in the partnership we are building together to support that vision.” She noted that the first phase of the Climate-Smart Agriculture Budget Support Programme had successfully integrated climate action with agricultural development. This approach is now embedded in Rwanda's National Strategy for Transformation. We began by supporting small-scale producers, and this has evolved into a broader approach to transforming the agricultural sector. Uyarra added that the second phase will continue to support policy reforms, strengthen institutions and mobilise complementary resources to translate ambitious policies into tangible benefits for farmers, rural communities and future generations. Priority investment areas The Minister of Agriculture and Animal Resources, Telesphore Ndabamenye, said the programme would prioritise districts in Southern and Eastern provinces, where drought has increasingly affected agricultural production. We need to increase agricultural productivity per hectare. Some districts are affected by drought, and therefore small-scale irrigation needs to be expanded, he said. We need to focus on food basket sites while prioritising conservation agriculture, soil erosion control, agroforestry, and the use of climate-resilient crop varieties and tree species. Research and innovation across these areas should also be strengthened to improve productivity and resilience. Food basket sites are part of a new land management approach under PSTA5, which aims to consolidate high-potential farmland to enable coordinated public and private investment. So far, the government has identified 13,379 food basket sites across the country, covering more than 495,000 hectares. Each site has undergone a needs assessment, and site-based agronomists have been deployed to provide technical support to farmers. Ndabamenye emphasised that agriculture and environmental conservation must go hand in hand. “The agriculture and environment sectors are closely linked. We need to educate farmers on affordable irrigation technologies, increase agroforestry, promote conservation agriculture and support smallholder farmers,” he said. “Some districts require substantial investment. We need an integrated package that improves sustainability, promotes better farming practices and provides seeds that are resilient to climate change.” The financing agreement builds on the European Union's broader cooperation with Rwanda. Under the current European Union Multiannual Indicative Programme for Rwanda (2021–2027), the EU has committed €390 million in grants to support priority sectors, including education, skills development and employment for young people, particularly in the digital economy. The programme also supports the green transition, inclusive economic development, and political and economic governance in Rwanda.
