Design strategies to attract private sector investment in agriculture

Researchers met last week in Kigali to push forward proposals to create more incentives to attract private sector investments into agro-processing to ensure the sustainability of the agriculture sector.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 labour force. However, while the agriculture focus is well thought, challenges remain.The public dialogue on public financing and expenditure in agriculture attended by various experts 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.One of the challenges is inability to attract investment in agriculture because the sector is regarded as risky. It is indeed appropriate for private individuals to invest in agriculture since government has put in place policies to guide agricultural production and processing.Government must come up with strategies that will attract investors in agriculture to further transform the sector. One of the incentives could lie in subsidies in form of tractors and agro-processing factories.The agro-processing factories are vital to prepare our produce for export. This does not however, take away other challenges that discourage private individuals from investing in agriculture.Challenges of inadequate electricity, poor feeder roads network and lack of food stores in rural areas will need to be addressed while building on the modest progress already in place.

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Design strategies to attract private sector investment in agriculture