The government, on October 17, launched the first-ever Climate and Nature Finance Strategy (CNFS) which seeks to accelerate public and private sector investments in climate action and biodiversity conservation.
The strategy aims to position Rwanda as a sustainable development leader, advance climate resilience and environmental preservation while supporting economic growth and social well-being.
ALSO READ: Rwanda faces $7 billion funding gap to implement climate action plan
The strategy will prioritise investments in projects that deliver both climate and biodiversity benefits, such as reforestation, sustainable agriculture, and conservation of wetlands.
Faced with challenges of limited domestic financial resources and difficulties in accessing international finance, Rwanda developed the strategy to leverage a combination of public, private, and international financing mechanisms, including green bonds, carbon markets, biodiversity credits, payment for ecosystem services, and blended finance to support climate and nature-related initiatives.
Tesi Rusagara, Minister of State for Public Investments and Resource Mobilisation at the Ministry of Finance and Economic Planning, said that the strategy complements other initiatives in place aimed to drive climate action.
"It will enhance the existing climate financing infrastructure. We also want to ensure that climate and nature are at the forefront of how we mobilise and allocate resources. There is a lot of new technologies, new financing models, and it's also an opportunity to expand into new markets,” she said.
ALSO READ: National budget increases by 11%, climate change among priorities
CNFS has four pillars including resource mobilisation, private sector engagement, nature-based solutions, institutional strengthening, and international collaboration.
Albert Solé, Senior Private Sector Specialist for East Africa at the World Bank, reiterated that Rwanda is already a leader in the mobilization of climate and nature finance, effectively leveraging global climate trust funds and bilateral resources for the environment sector.
"Implementation of the CNFS will expedite the mainstreaming of climate and nature considerations into traditional financing and economic planning efforts to promote sustainable development and conservation of Rwanda’s unique biodiversity and ecosystem services,” he noted.
According to a Biodiversity Financial Needs Assessment conducted in 2018, it is estimated that Rwanda needs between $97.5 million and $107.7 million during 2019-2030 to finance its biodiversity goals.
CNFS will prioritize climate-resilient and sustainable investments and support innovative financial structures and private sector funding to enhance climate action and conserve Rwanda's biodiversity.
Doreen Orishaba, Rwanda Managing Director of BasiGo – an electric mobility company that provides electric buses as a competitive alternative to diesel buses –lauded the country’s enabling environment and policies such as electric vehicles incentives that attracted them into the market.
"Hearing about this strategy to us, it’s about what more the government is going to provide to make the environment even much more attractive for investors like ourselves,” Orishaba said.
BasiGo is one of the companies that have benefited from Ireme Invest, Rwanda’s green investment facility that aims to mobilise climate finance at speed and scale.
The fund seeks to finance a portfolio of innovative projects in clean energy, smart mobility, sustainable cities, climate-smart agriculture, increased forest cover, and waste and circular economy.
Teddy Mugabo, the CEO of Rwanda Green Fund that manages Ireme Invest, said the fund has so far mobilised close to $200 million within a decade, contrary to the same amount secured within less than two years through the green investment facility.
She said it was important for the government to de-risk climate financing to incentivise more private sector to play a meaningful role.