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“Remarkable” results in agriculture, says World Bank

Article - July 18, 2017

After having attained food security in 2010, Rwanda has seen its food exports surge and poverty has been greatly reduced thanks to the advancements in agriculture. It will continue to develop agricultural commercialization through investment in irrigation and mechanization, while also encouraging the country’s entrepreneurially minded young people to enter the farming business


Over the last decade one million people in Rwanda have lifted themselves out of extreme poverty, and much of this immense progress is due to the growth of the country’s agriculture sector. Working in hand with the International

Development Agency since 2001, Rwanda has made on-the-ground investments that saw the country more than double its production and achieve food security by 2010.

Nearly 30,500 hectares of marshland and hillsides were sustainably developed, average crop yields on these lands rose by 100%, maize harvests increased from 1.6 annual tons to 5 tons, rice from 3 tons to 6, and potato crops from 7 tons to nearly 20. More than 50,000 new jobs were created. Over 43% of the beneficiaries of these increases were women.

The World Bank called the results nothing short of “remarkable”.
It’s hard to beat reaching food security in a country stricken by poverty, but the good news only continues. A thrust towards greater commercialization has meant a surge in Rwandan agricultural exports over the past few years. In 2016, exports grew again, by around 16% to reach more than $300 million, up from $259 million in 2015. In some cases, farmers’ incomes have risen by more than 30%. What has this meant in real terms? The combination of greater commercialization and higher yields directly contributed to a 12% decline in poverty between 2006 and 2011. Extreme poverty was cut by 14 percentage points.

Rwanda has a big goal: achieving lower middle-income status by 2020. It is clear to the government of President Paul Kagame that the agricultural sector is absolutely key in reaching this goal. Next up on the agenda, then, is a structural transformation that will foster commercial production powerful enough to create a middle-income economy. Investment in irrigation and erosion control for hillside production has been ongoing since 2010, capacity building of stakeholders across the value chain is in progress, work is being done to promote the emergence of a vibrant private industry for agricultural by-products such as fertilizer and a goal has been set to increase mechanization by 50% over the next four years. Most important, however, are projects for the development of transport and energy infrastructure that will revolutionize market access and rural community life.

“These projects are needed to transform not only the agricultural sector, but the whole economy. They will facilitate intra and inter regional trade. They are the solution to urbanization and a growing youth population. Greater access to electricity and transportation is the only way to get young workers to stay in rural areas. It will also aid in adding value to locally produced commodities. All these issues are addressed by the infrastructure-transformation agenda. We definitely see them as enablers of agricultural transformation,” observes the Minister of Agriculture and Animal Resources, Dr. Gerardine Mukeshimana.  

Engaging the country’s youth is important, agrees George William Kayonga, CEO of the National Agricultural Export Development Board. “The agriculture sector today hosts an aging workforce. Our first challenge is to implement strategic operations aimed at attracting the youth, at encouraging them to enter the sector, and not solely for employment, but also in terms of entrepreneurial possibilities,” he comments.

“In the same way that youth are attracted to ICT, there is a need for innovation in agriculture to inspire this growing population. We want to see our young minds engaged in all stages of the agricultural process, from management to primary production, and we must create the innovative techniques and advantageous economic conditions to attract them.”

Sina Gerard, founder and CEO of the Urwibutso Enterprise food processing empire, says improved transport infrastructure is set to boost his business significantly. In fact, his company is already preparing for it. “At the moment, it is easier for us to sell to the European and American markets than the African ones. However, with the regional integration efforts that have been developing, this problem will be resolved. It is a certainty that regional businesses will be facilitated,” he states.

“It will help us tremendously because we acquire a lot of our raw materials from neighboring countries, so these projects are a necessity for our operations. Furthermore, the new routes will also greatly increase our export potential. We have recently increased our production capacity so that when these projects are finalized, we will be able to maximize their potential.”

Exports are the name of the game
Agriculture already represents half of Rwanda’s exports and output is expected to grow by up to 28% by 2018. As regional connections improve, increased mechanization boosts yield and investment in agro-processing grows in the country, Rwanda’s agricultural sector is expecting explosive growth. But, says Mr. Kayonga, the sector will continue to focus on niche export markets.

“Non-traditional products constitute about 48% of our exports. Rwanda will never be able to compete with big international producers, so we must focus on exploiting market niches. Our products have to be high-end for consumers who are willing to pay an extra dollar for quality. Producing and processing stevia, for example, perfectly fits in our expansion profile. We have identified certain opportunities across different sectorial demands, and now we must engage in deeper value chain analysis to achieve maximum potential,” he comments.

Mr. Gerard’s company, which exports organic fruit, fruit juices, and vegetable products throughout the East African Community and the European Union, has long been an innovator in product diversification. The company has produced strawberries rather than staple foods and grown fruits new to Rwanda, such as grapes for wine production and apples.

Urwibutso also added yogurts, cereal flour and mineral water to its line. But Mr. Gerard’s most famous product is “Akabanga” Chili Oil. Akabanga, meaning “little secret”, is an extra-fiery condiment that is not for the faint-hearted; just two drops are enough to give food a solid kick. Popular in Rwanda, it is also shipped to chili-loving customers in the U.S. and across the world, and is the kind of niche product that Mr. Kayonga says can help Rwanda distinguish itself on the global marketplace.

The always innovative Mr. Gerard continues to develop new products, while also looking to introduce more of his products to world markets.

“We give a great deal of importance to the creation of new projects,” he says. “Diversification is key to us. Our company is forward-looking and innovative. We are currently working on concentrated juice for the European market, where there is a high demand for these types of juices. We monitor Europe’s market demand closely. This also helps our farmers. We have agriculture workers who produce the right products, but they do not have the right demand to sell these products.”