Government to revamp the agriculture sector

The government has embarked on an investment drive to revamp the agricultural sector employing 70 per cent of Rwandans.

The government has embarked on an investment drive to revamp the agricultural sector employing 70 per cent of Rwandans.

The move comes at a time when the sector has been registering a constant decline, with last year’s Gross Domestic Product (GDP) growth of negative 1.8 per cent reducing from 1.1 per cent in 2006.

Statistics from Rwanda Investment and Export Promotions Agency indicates that last year, only Frw573 million was invested, 35 jobs created while eleven projects were attracted in the sector.

Meaning agriculture was the least performer, trailing behind services, construction and manufacturing sectors.

Despite the negative GDP growth recorded, government is willing to further sink more funds and source investors to revamp the sector.


James Musoni, Finance and economic planning minister noted that issues like water management which includes planning and developing distribution of water under defined policies and regulations are a priority if the sector is to grow.

"Land management through land consolidation, settlement and echo system mechanism must be addressed," the minister added.

This will require comprehensive land consolidation with the aim of re-allocation of land together with a broad range of other measures to promote rural development.

Such activities include village renewal, support to community-based agro-processing, construction of rural roads, construction and rehabilitation of irrigation and drainage systems.

It also calls for erosion control measures, environmental protection and improvements including the designation of nature reserves.

This integrated development project aims to improve rural development and gain stable food prices through a variety of projects.

The projects according to Musoni, including the crop intensification programme, national fertiliser policy, irrigation and post-harvest practices.

"To achieve this, agriculture budget has been increased by 50 per cent," Musoni said.

Adding: "This will entail a high component of foreign exchange spending in the budget via importation of capital goods."


The Economic Development and Poverty Reduction Strategy (EDPRS) goal is to increase the national savings rate from 12.4 per cent in 2007 to 18.4 per cent in 2012 as a percentage of GDP and thus increase access to credit.

It will comprise increasing savings of the majority individuals and households employed by the agriculture sector. Support to Micro Finance Institutions (MFIs) must be increased in order to increase access to finance for SMEs especially those in the agriculture sector.

In order to increase savings mobilisation, increase access to financing for Small and Medium Enterprises (SMEs), scaling-up leasing is to be implemented.

Most SMEs fall under the agriculture sector meaning that farmers are likely to access assets through cheap means of financing.

The ministry of finance and economic planning jointly with that of agriculture are to develop a rural insurance strategy which will propose insurance products for the agriculture sector and develop mechanisms to support its implementation.

Government this year is also planning to execute the national microfinance policy implementation strategy.

"Concretely this translates into the establishment of the microfinance investment fund, the microfinance guarantee fund and the microfinance capacity building fund," Musoni noted.