Rwanda’s push toward modern farming methods and agriculture mechanisation is set to receive a timely boost after US-based firm, Nationwide Group International, unveiled a new agro-equipment leasing product. The firm plans to provide agriculture equipment worth $200 million (about Rwf168.6 billion in the short to medium-term “to help local farmers improve production and spur the sector’s growth”. It will also inject more funding in construction-related projects, according to officials.
Ed Kostenski, the founder and president of Nationwide Equipment, one of America’s leading suppliers of farm machinery, said the firm will lease to farmers and contractors a range of agro-equipment to help them improve productivity and value-addition. The company also supplies mining, construction and marine equipment, among others.
“We want to make it affordable for farmers to acquire equipment so that they improve their production processes and output, which will make the sector more profitable,” Kostenski said in an exclusive interview with The New Times. No interest will be paid on leased equipment for the first one year, but beneficiaries will pay less than 3 per cent interest per annum (after this) for the next five years.
Kostenski noted that supporting the agriculture sector is instrumental to drive growth in the long-run and enhance production and household incomes, and increase the sector’s contribution to national GDP. Under the country’s agriculture mechanisation strategy, the government targets to increase the level of mechanisation to 25 per cent by the end of next year, and 50 per cent by 2020. However, mechanisation uptake, especially by small farmers, is still low despite a 2015 policy, where farmers can buy or hire farm equipment.
Farmers welcome the initiative
Meanwhile, farmers have welcomed the initiative, saying it could prove critical as the country targets to record up to 8 per cent annual growth rate for the sector under the second Economic Development and Poverty Reduction Strategy (EDPRS II).
Sam Rubagumya, a farmer in Nyagatare District, was impressed that the new leasing product is tailored to meet the needs of the sector, saying it will go a long way in helping prop-up the sector’s productivity besides improving the value chain.
More support for construction sector
Kostenski revealed plans to increase the company’s support to the construction sector from the current $13 million to $18 million in the next few months.
“We noticed that the country’s construction industry is on an upward trajectory and, therefore, decided to increase investment into the sector, which we are optimistic will create more employment opportunities for Rwandans,” he said, adding the group was planning to open a permanent office in Kigali.
About Nationwide Group
Nationwide Group International is the leading project financing powerhouse in the United States of America with operations in mining, construction and marine equipment supply, oil and gas, exploration and production, as well as refineries. The group started operations as Nationwide Equipment in 1983 in Jacksonville, Florida, specialising in the rental and sale of reconditioned earthmoving and road-building machinery. It has been operating in several African countries over the last two decades, serving private companies and government bodies.
Kostenski explained that the group operates as a general machinery lessor for the middle-market through investment-grade companies, mainly in industrial sectors. “We provide diverse equipment lease financing options for farmers, as well as mining and construction, among others,” he noted.