Ambassador Vrooman Remarks at the Launch of USAID’s Feed the Future “Nguriza Nshore” Activity
September 20, 2018
Kigali Convention Center
Thank you for joining me this morning in launching the U.S. government’s new Feed the Future Nguriza Nshore activity.
Our Feed the Future program has promoted agricultural-led economic growth in Rwanda over the past five years. For example, farmers we supported increased their sales by $127 million. They leveraged an additional $68 million in new private sector investments in the Rwandan agricultural sector. What is the employment impact? More than 50,000 new jobs in the agricultural sector.
USAID promotes small and medium enterprise growth. We support agribusiness that focus on post-production through the export process.
It’s no secret that one of the main barriers to sustained growth in the agribusiness sector in Rwanda is the limited availability of financing. Promising Rwandan agribusinesses currently face staggering interest rates for borrowing money. Collateral requirements that often exceed 100% of the loan amount requested. Investors interested in making investments in Rwandan agribusinesses often face high costs and a limited range of options for businesses that might provide them positive returns. As a result, there is a limited number of small- to medium-sized firms in Rwanda, which offer stable employment opportunities, particularly outside of Kigali.
Financing barriers to small and medium enterprises are not unique to Rwanda. But, Rwanda is unique in its ambition, resolve, and resources committed to address this challenge. The Vision 2050 strategy envisions Rwanda as a financial services hub in East Africa. The National Strategy for Transformation outlines a plan to create the Kigali International Business and Financial Services Center, a hub that will foster financial services and support international banking, fund management, and the expansion of capital markets.
The goals are to double the value of the financial services sector by 2024 and to double foreign direct investment in to the Rwandan economy. To achieve these ambitious targets, Rwanda needs a bustling small and medium enterprise sector to 1) increase competitiveness and 2) to develop new domestic investment opportunities. How?
USAID’s Feed the Future Nguriza Nshore activity will increase financing available to small and medium enterprises in the agricultural sector by a 39.5 billion Rwandan francs. This money won’t just help the businesses receiving this new financing, but will drive economic growth and create new jobs across the country. In other words: “Ibi bigo ni bibona aya’mafaranga buri’muturage wese azabyungukiramo” (when these businesses get this money, every citizen will benefit).
Nguriza Nshore will support Rwandan financial institutions, like banks, to reassess and adapt their lending strategies to small and medium agribusiness. Nguriza Nshore will interested investors with investment opportunities. And by working with ministries across the Government of Rwanda, Nguriza Nshore will help support the development and refinement of policies, regulations, and strategies that foster broad-based firm growth in the agribusiness sector.
In short, we are committed to supporting Rwanda’s path to self-reliant and sustainable growth. Over the next five years, Nguriza Nshore will facilitate the necessary conditions for what will truly be a transformational investment to build and grow businesses.
Nguriza Nshore will work with MINICOM, the Rwanda Development Board, the Ministry of Agriculture and Animal Resources, the National Bank of Rwanda, and others to improve programs, platforms, and policies that scale entrepreneurship and SME finance and growth.
In closing, I would like to thank you very much for being here and wish you a very productive partnership through this project with the Government of Rwanda, including the Ministry of Trade and Industry, and other agencies, with the private sector and financial institutions.
