The Government of Rwanda and World Bank Group, yesterday, signed two International Development Association (IDA) credit agreements totaling $200 million (about Rwf140 billion).
The money will help boost public financial management and support agriculture sector transformation, Claver Gatete, the Minister for Finance and Economic Planning, said.
The funds will be disbursed in three phases for the next three years with $60 million expected this fiscal year, according to Gatete.
“Public financial management and agricultural transformation are central to government’s development plans. It’s crucial that we are able to make evidence-based policies that will, in turn, have a positive impact on our people,” he said.
Gatete said $100 million (approximately Rwf70 billion) will be injected into transforming the country’s agriculture sector programme (Phase 3) while the rest will be channeled into supporting public finance management.
“Strengthening public financial management and statistics systems programmes will help boost the government’s statistical capacity to make evidence-based policy decisions and improve planning and budgeting,” Gatete added.
The State Minister for Agriculture, Tony Nsanganira, said the programme will focus on raising famers’ income through crop diversification, better use of input to combat erosion, improving irrigation and increased private sector investments.
“We want to enhance productivity through more research and partnership with the private sector,” Nsaganira said.
Carolyn Turk, the World Bank Country Manager for Rwanda, noted that one of the innovative features of this programme is that it includes gender-responsive budgeting, with training for planning and budget officers to generate national and sub-national gender statistics.
It’s also critical that government targets technological transfer along the value chain while emphasising exports, she added.
Both programmes will utilise the Program for Results (Performance for Results) financing instrument in order to improve the efficiency and effectiveness of government expenditure programmes and help capacity building, according to Turk.
Performance for Results is one of the three financing instruments in a four-year Country Partnership Strategy signed between Rwanda and the World Bank.
Others include Development Policy Objective (DPO)Sector budget support and Project Modality Support.
The country’s agriculture sector grows at a rate of five per cent per annum, and contributed 1.5 percentage points to the overall Gross Domestic Product growth during the first half 2014.
Overall, the agriculture sector employs about 80 per cent of citizens and contributes 33 per cent of the country’s economic growth. There is hope among sector players that the funds will help increase productivity and spur economic growth.