World Bank provides US$300 million to commercialize, de-risk agricultural transformation in Rwanda

RWANDA – The World Bank Group has approved US$300 million in financing, comprising International Development Association (IDA) grant and credit, to help the Government of Rwanda increase irrigation, commercialization, and access to finance and insurance for farmers and other value chain actors in Rwanda’s agricultural sector.

This will be carried out through the new Commercialization and De-Risking for Agricultural Transformation Project (CDAT).

CDAT is aimed to support the government provide services and create an enabling environment for the private actor throughout the agricultural value chain.

It will finance public investments in the seeds sector, develop and rehabilitate irrigation systems on over 17,600 ha, provide accompanying land husbandry development on about 11,000 ha in surrounding water catchment areas to increase productivity and promote climate smart agriculture.

The project will also support commercialization by helping farmers access markets and availing matching grants for investments in mechanization, post-harvest infrastructure and processing equipment. 

A CDAT challenge fund has also been set aside for investment in particularly innovative solutions for the sector that can be brought to scale.

The project is nationwide and is foreseen to directly benefit at least 235,000 households, including women and youth.

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Rolande Pryce, World Bank Country Manager for Rwanda highlighted that, “Commercializing agriculture is essential for Rwanda’s economic transformation and poverty reduction and requires investments that enhance productivity in a sustainable manner, and that generate agriculture value addition and off-farm jobs.

“The Commercialization and De-risking for Agricultural Transformation Project aims to generate marketable volumes of produce and facilitate their access to market, while de-risking and leveraging private sector investment in value generating agri-food activities.”

In partnership with financial institutions, the project will seek to enhance access to affordable financial services and products in the agricultural sector by providing long-term financing and reducing risks and challenges faced by agricultural value chains through strengthening market linkages and scaling up agriculture insurance.

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“Availing financing to farmers and cooperatives, as well as post-harvest value chain actors is crucial for the development of the sector.

“This project seeks to build the agricultural finance market by collaborating with different financial institutions to implement models for agricultural financing while at the same time making the agricultural sector less risky to invest in.

“The project will holistically support agricultural value chains and the complementary roles of public and private actors in agricultural transformation,” said Åsa Giertz, World Bank Senior Agriculture Economist, and Task Team Leader of the project.

MoU on cooperation in development of circular economy

Meanwhile, Italian multinational energy company, Eni, and the government of Rwanda signed a Memorandum of Understanding (MoU) to identify collaborative opportunities in circular economy, agriculture, forestry, innovation and digital information technology.

Under the terms of the MoU, the two parties will evaluate the feasibility of circular economy projects focused on collecting used cooking oil and waste oils, waste management valorisation and recycling.

Other fields of interest are agriculture, especially bio-feedstock production and the transformation into decarbonised products.

This is in addition to forestry, especially forest conservation and generation of carbon credits through a wide range of initiatives, such as reducing CO2 emissions from the wood-fuel value chain and other service activities.

The MoU aligns with Rwanda’s goal to fast-track economic development by enabling private sector growth and Eni’s commitment to increasing energy efficiency in African countries, leveraging agro-industrial projects in a sustainable framework.

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