Government tipped on private investments in agriculture

Government should create more incentives to attract private investments in agro-processing to ensure the sustainability of the agriculture sector, experts have advised.During a public dialogue on public financing and expenditure in agriculture, on Thursday, researchers and officials from the government agreed that although government has been increasing investment in agriculture over the years, much of the funds are from donor aid, which may not be sustainable.The dialogue was organised by ActionAid.“Sixty per cent of government’s expenditure will be supported by domestic resources; much as there is a need for self-reliance, in agriculture, we are still dependant on donor money. So we need more of the private sector in the agriculture sector,” Dickson Malunda, a research specialist at the Institute of Policy Analysis and Research, argued.“Government has been giving incentives to foreign direct investors. Now, they should give more incentives to private investors in agro-processing in the rural areas. It is not sustainable to run agriculture on donor money as seen last year when they froze some of it.”The idea is not new to the government however, according to the Ministry of Agriculture, which said that plans to increase electricity generation, construction of more feeder roads and food stores in rural areas are some of the incentives it is looking at.“Our strategy is to look into how to increase investments in agriculture; the idea is to involve the private sector more, as well as to harmonise actions and deliver a mutual effect,” Agnes Mushimiyimana, the planning and budget expert at the Ministry of Agriculture, said.She added that: “We can interlink activities with the private sector, keeping in mind that the farmer is at the core of what we do. We have technicians on the ground to ensure that they collect information concerning farmers’ needs and challenges in order to implement the right policies.”Under the 2013/14 Budget which totalled up to Rwf1.6 trillion, government will spend 50 per cent of the funds on the second phase of the Economic Development and Poverty Eradication Strategy programme (EDPRS II). Under this strategy, government seeks to increase agricultural annual growth from 5.9 per cent to above 8.5 per cent.Agriculture remains the main income earner in Rwanda, employing over 88.8 per cent of homesteads, while it accounts for 90 percent of the labor force.Statistics from the Ministry of Agriculture show that the sector contributes about 36 per cent of GDP and 70 per cent of country’s export revenue through mainly coffee and tea.

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Government tipped on private investments in agriculture