Horticulture is one of the strategic areas Rwanda is betting on as it seeks to expand its agricultural export base through diversification and aim to generate US$1 billion (over RWF1 trillion) in annual foreign farm revenues by 2024.
This is more than double the approximately $445 million registered last fiscal year.
To that end, the country is aiming to increase its horticultural (fruit, vegetable and flower) export earnings from currently over $28.79 million in FY2020-2021 to $130 million in exports by 2024 (or a contribution 13 percent of the total). projected agricultural export earnings), according to the National Agricultural Export Development Board (NAEB).
The New Times’ Emmanuel Ntirenganya interviewed Kebba Colley, Director of Inclusive Business Development at IDH, about the organization’s work in Rwanda, with a focus on the country’s horticultural sector and its potential.
Kebba Colley, Director of Inclusive Business Development at IDH (Courtesy).
IDH, The Sustainable Trade Initiative, is an organization (foundation) that works with businesses, financiers, governments and civil society to make sustainable trade a reality in global value chains.
Here are the excerpts:
In short, what does IDH’s work in Rwanda entail?
Founded in 2008 by the Dutch government, IDH is now funded by several governments in Europe, including the Netherlands, Switzerland and Denmark.
We’ve been working on it since 2017 [agriculture] Development of the value chain in Rwanda.
This intervention is based on access to affordable finance, business development and technical support, and access to the market.
Specifically in Rwanda, we have worked with seven Rwandan horticultural exporters who sell everything from avocado, passion fruit, chili and [French] beans.
This is intended to increase exports and find buyers in the European market (premium buyers), including Great Britain, the Netherlands, France and, more recently, Dubai and Qatar.
Our work with the Rwandan exporters has focused on about three or four areas. The first is to look at the operations of the company to ensure that we are supporting the companies with our specialists to build the Rwandan exporters skills to produce the right product that the market is looking for, with the quality and quality also with the certification.
Also, we have supported the growth of the country’s horticultural sector through increased agricultural mechanization, including irrigation to ensure stable production and supply even during the dry season, and inputs such as fertilizers and chemicals needed to produce the crops, as well as through packaging.
What investments have you made in Rwanda’s horticultural sector and what has been the impact so far?
The interventions are carried out through co-financing, whereby the organization grants an exporter a subsidy of 50 percent of the investment [they need to make for a given purpose]then the exporter also takes on 50 percent.
This is done through the project called HortInvest.
On the investment side, we invested about 5 million US dollars through this project [over Rwf5 billion] along with companies in Rwanda in about the last four years.
And this has helped increase the [horticulture] export from [horticulture] Products from Rwanda 300 percent.
We also help Rwandan exporters find buyers in Europe by identifying and connecting them, and raise awareness of Rwanda abroad.
Rwanda produces a brand, which means products made in Rwanda are a Rwanda product. Therefore we develop marketing training, documentation and marketing materials to be distributed to different markets in Europe so that they know that Rwanda has products in the horticultural sector.
Given the market opportunities and even the production side, how do you see the potential of the horticultural sector in Rwanda?
Big, big, big. Rwandan exporters and companies receive a lot of support from the government. And that’s very important for companies to get the support they need from their government. This is one. Second, Rwandan exporters are very focused and success driven, they want to be successful in their businesses.
So if you have people like that, get support from government institutions and work with IDH facilitating and supporting them, their potential is great, because it’s not just about exporting to Europe, they also have to think about producing for the locals Market.
So if you have the Kigali wholesale market that is built sometime in the coming years, that is a good market for Rwandan exporters to supply too. And then they can ship to (DR) Congo, Burundi, Uganda, Tanzania etc.
High air freight charges are one of the biggest concerns for horticultural exporters as some are unable to tap into some available markets as they have not been able to make a profit from it. Is anything being done to fix the problem?
The reality is air freight [transport] is expensive everywhere because of this oil crisis we are going through.
What’s happening now, everything goes by plane… What we’re doing to lower the cost for exporters is to try other alternatives, which is the sea fleet. The Dutch Embassy is working with IDH to run this pilot project [to see whether shipment by sea can help reduce the transport costs].
Some of the French beans growing in one of the farms in Rwanda. IDH has supported the development of the horticultural sector in Rwanda to increase production and revenue. (decency).
So we’re running a new test with a company from the Netherlands and companies in Rwanda to see if we can narrow it down [air] Freight and transportation by sea. Then one goes to Mombasa, another to Dubai, another to the Netherlands.
It’s cheaper if you go by sea; and that’s why we’re now doing a pilot project. The pilot is to show if you export fresh produce from Rwanda by sea, go to Mombasa by road (truck). [port in Kenya]and then by sea to Europe [what does that cost?]. We won’t know how much it will cost until the end of the year.