Thursday, Jul 18, 2024
Update At 14:00    USD/EUR 0,92  ↑+0.0002        USD/JPY 151,69  ↑+0.174        USD/KRW 1.347,35  ↑+6.1        EUR/JPY 164,16  ↑+0.143        Crude Oil 85,49  ↓-0.76        Asia Dow 3.838,83  ↑+1.8        TSE 1.833,50  ↑+4.5        Japan: Nikkei 225 40.846,59  ↑+448.56        S. Korea: KOSPI 2.756,23  ↓-0.86        China: Shanghai Composite 3.015,74  ↓-15.745        Hong Kong: Hang Seng 16.512,92  ↓-105.4        Singapore: Straits Times 3,27  ↑+0.018        DJIA 22,58  ↓-0.23        Nasdaq Composite 16.315,70  ↓-68.769        S&P 500 5.203,58  ↓-14.61        Russell 2000 2.070,16  ↓-4.0003        Stoxx Euro 50 5.064,18  ↑+19.99        Stoxx Europe 600 511,09  ↑+1.23        Germany: DAX 18.384,35  ↑+123.04        UK: FTSE 100 7.930,96  ↑+13.39        Spain: IBEX 35 10.991,50  ↑+39.3        France: CAC 40 8.184,75  ↑+33.15        

Agriculture: ‘the new oil’

Interview - September 6, 2016

Rwanda’s Minister of Agriculture and Animal Resources Dr Gerardine Mukeshimana revelas the vast opportunities for investment in developing and adding value to the sector, particularly in mechanization, machinery and public-private partnerships (PPPs).



2014 was the Year of Agriculture in the African Union. Akinwumi Adesina, Nigeria’s former Minster of Agriculture, said back then, “In Nigeria, we are making agriculture the new oil.” What are the trends you are seeing on this side of the continent to transform the sector?

Mr Adesina is absolutely right. There are new areas of investment that can be as attractive in order to stop relying so much on oil. Knowledge-based economy, green-based economy, and so on, are contributing to our development. Countries, especially in Africa, are looking ways to stop relying so much on raw materials; they are looking at their comparative advantages and are developing a smarter way to address the demand of specific market niches.


Rwanda has been embarking on mega-infrastructure projects such as the Northern and Central Corridor railway projects or power plants to enhance trade and industrialization. How do you expect these projects to affect the agriculture sector?

These projects are enablers of agricultural development in every country. These projects are the needed supporters to transform not only the agricultural sector, but the whole economy. This infrastructure projects are meant to facilitate intra and inter-regional trade, and agriculture commodities are among those commodities. Urbanization together with a young growing population are to be supported by needed infrastructure. Giving a greater energy-access to rural areas and ameliorating transportation is the way to get young workers to stay where they are most relevant. If people don’t have electricity, if people don’t have television or access to cars, they won’t stay. It is a necessity to develop these types of background infrastructure and products as a nation. This will not only attract people to work in the production sector, it will also help develop industries in rural areas, especially those adding value to locally produced commodities. These places are the future areas of our nation.

All this is addressed by the infrastructure-transformation agenda. We see them as enablers of agriculture transformation and prosperity in Rwanda and in the region.


One of the ministry’s responsibilities is creating an enabling environment for productive investment. How are you working to make the agricultural sector more attractive to investors?

As a nation we have a clear investment-guided policy that does not discriminate against any sector. When it comes to specific investors who target specific sub-sectors, we have to make sure we support them so that they stay. If they don’t stay, someone else will take them away.

As a country that doesn’t have a huge amount of land, we want to make sure that we are grouping these farmers into farmer cooperatives to answer the market’s demand. Supplying the needed inputs by offering investors the specificities they demand is crucial. The PPP format helps them feel comfortable by providing them with these needed tools to develop the targeted sectors.

In Rwanda, it’s impossible for an investor to come and buy 2,000 hectares of land. However, we want to make sure that the 200 hectares he can buy are maximized both in terms of production and arrangement. The PPP is there to make them feel comfortable by providing investors what they want.

Other components of the value chain, such as aggregation, warehousing, agro-processing, even marketing, still hold potential for investments.


When we interviewed the Minister of Agriculture of Malawi he said, “An informed farmer is a productive farmer.” As the IT hub of the region, how are you using new technologies and innovative solutions to increase agricultural productivity and overall results?

We have a large amount of ICT components imbedded into the sector. We tailor these components depending on the demands of the sector. From irrigation, extension services and marketing platforms to post-harvest infrastructure, IT solutions are there to solve specific problems. Depending on the component demanded by the value-chain, we apply IT in order to support our workers as much as we can. Mobile technologies are playing instrumental roles


The sector under your mandate generates more than 50% of the country’s export revenues, and it is expected that agricultural exports increase in average from 19.2% to 28% p.a. by 2018. How would you assess the role of the private sector in order to increase the exports?

The majority of export commodities come from the private sector, most of the tea processing factories belong to the private sector. Again, that’s a wanted arrangement to make sure that key factories have enough land and manpower to process and export. Coffee is purely worked by the private sector. The producers are from the private sector; the exporters are from the private sector and the same phenomenon applies to our fruits and vegetables.

Our role as the government is to provide the right facilitations and the right opportunities for all sub-sector actors to do efficient business. What the private sector does, the government cannot do. We are not business people, we are policy and technical supporters and our most important feature is to find ways to provide supporting environment for them to operate. We therefore invest in trust, ability and skills to make sure that they can do business in a way that is always more and more efficient.


Khalid Bomba, the CEO of the Agricultural Transformation Agency of Ethiopia, told us how they are working to link the farmers to the markets and the good results it is having. How is your Ministry working to achieve similar results?

Linking the farmers to the market starts from local organization. In Rwanda, a country where land is limited, it doesn’t make any sense to farm in an individual basis. We have therefore invested in land-consolidation cooperatives to make sure that farmers work together while keeping their piece of land ownership. We do so in order to make sure that they work together, communicate amongst each other and access public services. If production is shared, the costs become manageable.

From there we support and provide technical assistance to maximize production and post-harvest capacity and management. There are considerable public investments in rural roads connecting the farms to the markets.

Companies involved in commodity trading are starting to emerge, such as commodity exchange platforms and processing companies to provide and connect farmers to potential markets. We want them to sell in a more direct way in order to add greater value instead of passing through middlemen. Any arrangements that enhance direct selling are highly supported.


What opportunities would you like to highlight to our readers?

Production cost gets higher and higher when labor is not mechanized. It is taking a certain amount of time for people to realize that mechanization is the way to go. And mechanization is not just cultivation machinery; it reduces production costs in planting, harvesting, threshing, cleaning, grading, etc. 

What I want to highlight is that we are facilitating the lease and service provision with regards to mechanization and machinery.

There is a law on leasing so that the private sector can sell to and service the farmers. We are hunting for people willing and able to invest into machinery assembling here in Rwanda. We already have created an infrastructure in that regard, but it hasn’t been of use because no one has brought the right investment. We therefore want to orientate into mechanization through investment and leasing so that farmers of all sizes can produce effectively.

If you look at our region as a whole, the easiness to expand beyond Rwanda is definitely an attractive opportunity.


As Africa is becoming a growing investment destination, what are the factors driving this great interest of investment to the continent?

Africa has historically been in the back of the investment arena. Nowadays though, the continent has grown to become an attractive place for investments and people are realizing that. Technology has reduced the size of the world and Africa is showing to the world that it is a growing market. And, as Africans, we are realizing that we lost a lot in being perceived as a place where things are extracted from raw, transformed somewhere else and sold back at very high prices. African nations have to realize that it is important to set up policies that can attract people to do business within Africa, and Africans to be part of these businesses


How did your background as a scientist contribute to enriching your experience as the Minister of Agriculture?

My scientific background helps me on a daily basis. Agriculture is a science, it is a technical business and it is important to know what you are doing. Science derives conclusions based on evidence. Having a scientific background and a technical knowledge is critical and it has helped me very much in terms of decision-making.


What motivates you most and what would you like to see happening in a couple of years?

My dream is to see all Rwandans out of poverty. The agriculture sector can achieve so much. Agriculture employs most Rwandans. There are so many chances and opportunities in this sector. People who have graduated out of poverty probably went from being basic producers, to input-sellers, to owning a small agro-processing unit. I am very much driven by the need to transform lives.