A transformative multimillion-dollar investment plan has been envisioned by the Ministry of Agriculture and Animal Resources with the support of the Food and Agriculture Organization (FAO), which could significantly reduce poverty, malnutrition, and stunting.
The investment plan is rooted in the vast opportunities for the private sector in the agriculture and livestock sector, and it has the potential to benefit more than 1.4 million people and requires $501.8 million to be implemented. The plan focuses on three key value chains – tea, small livestock (pig and poultry), and potato.
The investment plan is not just a local endeavor, but a strategic alignment with the FAO's global Hand-in-Hand (HiH) Initiative. This initiative is evidence-based, country-led, and country-owned, testament to the global support and recognition of Rwanda's agricultural potential. It aims to accelerate agricultural transformation and sustainable rural development, providing a solid foundation for the investment plan.
The initiative prioritizes territories where poverty and hunger are highest and capacities are limited due to natural or man-made crises. The selection of districts for the initiative considered criteria such as high poverty rate (estimated at 33.8% according to the National Institute of Statistics of Rwanda – NISR, 2022), high malnutrition and stunting, and high unrealized agricultural potential with unemployment particularly of youth.
The investment plan aims to make a significant social impact, aligning with Sustainable Development Goals (SDGs) 1, 2, and 10, which aim to eradicate poverty, end hunger and malnutrition, and reduce inequalities.
Accelerating the transformation of agri-food systems will raise incomes, improve nutrition, empower poor and vulnerable populations, and strengthen resilience to climate change.
Speaking during the National Investment Forum of the Hand-in-Hand Initiative, which was held on April 23 in Kigali, FAO Representative to Rwanda Coumba Dieng Sow said that the initiative was meant to find a way to quickly lift people out of poverty, create employment, address malnutrition through agribusiness, and address vulnerability to climate change effects.
"We do believe that the Hand-in-Hand Initiative will yield good results for private sector and will also inform the implementation of the fifth Strategic Plan for Agriculture Transformation (PSTA5), which is currently in its final phase,” she said.
The Minister of State for Agriculture and Animal Resources at the Ministry of Agriculture and Animal Resources (MINAGRI), Eric Rwigamba, said they identified value chains offer opportunities to the private sector to invest and make money as they address the problems in question.
"These are investment plans that have been done by experts [from FAO and MINAGRI]. And what they told us is that, actually, you can get as high as 29 percent internal rate of return on some of these value chains,” he observed, pointing out that while most of the country's loans go to real estate and hotel businesses, they cannot guarantee more than 15 percent internal rate of return.
Zano Mataruka, the Country Director for International Finance Corporation, Rwanda and Uganda, said that "the choice of the only three value chains under HiH allows Rwanda to make it easier to narrow down to those three, and those three that have been chosen are also subsectors where there is potential to convert smallholder farmers into viable farmers through increased productivity.”
Jean Claude Shirimpumu, the Chairperson of the Rwanda Pig Farmers' Association, said that the Hand in Hand Initiative is relevant as it is responding to the existing issues affecting communities in the selected districts, pointing out that it could promote the consumption of animal-based proteins through eggs and meat, hence addressing malnutrition in the districts in question.
Tea
The tea subsector plan requires an investment of $299 million and covers 17,000 hectares of land for tea production in four districts. It includes the production of 300 million tea seedlings and the establishment of a tea factory and a research center. The interventions are expected to benefit 85,000 tea growers and value chain actors as direct beneficiaries and 195,831 indirect beneficiaries.
Small livestock production – poultry and pig value chains
Rwanda plans to invest $179M in small livestock production across five districts: Ngororero, Nyamagabe, Nyanza, Nyaruguru, and Ruhango. The program includes a feed processing plant, poultry and pig feed storage, a layer chicken hatchery, a genetic improvement farm, and a pig and poultry model farm. The investments could benefit 123,000 pig farmers and 69,953 poultry farmers as direct beneficiaries, with 339,304 poor local communities and 311,365 youth, women, preschool, and school children as indirect beneficiaries.
Potato value chain
The plan invests $23.8 million to develop the potato value chain in Ngororero, Nyamagabe, and Nyaruguru districts. $10 million will be used to produce early-generation potato seeds across three seasons and establish potato storage and processing facilities. Expected benefits include direct aid to 41,772 potato producers and processors and indirect aid to 245,341 potato value chain actors.
The FAO launched the Hand-in-Hand Initiative in October 2019.
It follows a match-making approach that brings together beneficiary countries with donors, private sector organizations, international financial institutions, research institutions, and civil society organizations. This approach aims to mobilize means of implementation that can support accelerated action towards achieving the initiative's goals.