Only by switching to sustainable farming methods will farmers in Rwanda be able to foster growth, and increase agriculture off-farm employment such as agro-processing.
World Bank Senior Economist Africa Region, Birgit Hansl, said an essential part of that is changing the skills profile of people employed in the agriculture sector, and build their capacity if they are to diversify production.
“Agriculture sector featured in our spring edition because it remains one of the main drivers of Rwandan economy,” Hansl said during a meeting on Rwanda Economic Update, a report produced by the World Bank to assess the country’s development in the past six months.
The first of it kind in the country by the World Bank, the gathering attracted policy makers, business leaders and analysts engaged in Rwanda’s economy.
According to the World Bank, Rwanda’s agriculture grew by five percent in last five years, contributing 36 percent of the overall economic growth and generating 45 percent of the country’s export revenues.
“It occupies 80 percent of the labour force and this shows the importance in achieving the development vision for sustainable growth and poverty reduction; agriculture is the catalyst to go for in poverty reduction,” she stressed.
This year, agricultural growth is expected to be modest, slightly higher than the 4.6 percent registered last year against a record high of 7.7 percent in 2009.
World Bank estimates are however a bit different from central bank’s projections, where agriculture grew by five percent in the first quarter of this year with robust growth projected in season B.
Wolfgang Fengler, a lead economist, hailed Rwanda for catching up with EAC member countries like Tanzania and Uganda in terms of GDP per capita which stands at US$500. Kenya’s is ahead at US$750 while Burundi is at a lowly US$150.
“Rwanda is embracing the Singapore model, so it’s possible to move from third world to first,” Fengler said, adding that “...it’s impossible for Rwanda to compete, globally, but I like the clever strategy of competing on quality like its being done in coffee.”
Experts in Rwanda could boost agriculture production only by reducing the knowledge deficit like lack of information on profitability and value chain activities.
Some of the challenges highlighted include soil fertility, poor post harvest management and irrigation.
Rwanda’s overall growth of 7.5 percent, which is two percent higher than East Africa’s, is considered healthy.