EU commits over Rwf270 billion funding to Rwanda

On 18 mai 2022 at 11:44

The European Union (EU) has launched a new cooperation strategy with the Government of Rwanda where under the Multiannual Indicative Program, it commits to provide € 260 million (Over Rwf270 billion) funding to skills development, education, agricultural transformation, good governance and private sector development among others from 2021 to 2024.

The financing agreement signed on Wednesday 18th May 2022, has been witnessed by Rwanda’s Minister of Finance and Economic Planning, Dr. Uzziel Ndagijimana and the EU Commission Deputy Director-General, Myriam Ferran.

Minister Ndagijimana has revealed that part of the funds will be allocated for capacity building in the sectors of governance and justice.

In the education sector, the Minister disclosed that the funds will be utilized to build new early childhood development centers and increase the capacity of existing ones.

Part of the funds will also be allocated for environment preservation efforts by addressing the issue of slums and mitigate floods among residents dwelling in wetlands.

commenting on the development, the Minister of Finance and Economic Planning Dr. Uzziel Ndagijimana noted : “EU support to key areas such as human capital development, green economy through agriculture transformation, private sector development as well as governance is a sign of strengthened collaboration, partnership and enhanced ownership to deliver transformational change we both desire.”

Myriam Ferran has said that the new partnership will be beneficial to Rwandans and meaningful to different initiatives meant to support national development.

She underscored that the EU has bold ambitions to support the development of African countries, particularly Rwanda as a country that has been efficiently utilizing received grants.

“The European Union has a long standing partnership with Rwanda and we are proud to be one of the key partners in the country’s path to sustainable development. With this strategy we renew the EU’s commitment to support pro-poor, sustainable and inclusive economic growth, by focusing on (i) skills development as a pre-requisite to attract investment and spur growth, (ii) a green deal for agricultural transformation and (iii) good governance and private sector development, including through developing the pharmaceutical sector as an emerging high political priority," said the Deputy Director General of European Commission, Myriam Ferran reaffirmeing the good cooperation between Rwanda and the EU.

The bilateral grant amount will be further complemented by regional and thematic funding, as well as lending by the European Investment Bank.

The new cooperation strategy will be implemented under the new Global Europe financing instrument. Global Europe will increase the collective scale and impact of European partners in Rwanda. This development instrument brings a much stronger #TeamEurope approach, entailing a focus on partnerships with the European Investment Bank (EIB), EU Member States, their agencies and their development banks. The MIP outlines two ambitious Team Europe Initiatives on “Agricultural Transformation” and “Sustainable Rwandan cities fit for the Digital age”, which both have a strong participation of EU Member States and clear potential for transformative impact.

All of the proposed priorities are also fully in line with the European Union’s Global Gateway Strategy with interventions focusing on fighting climate change and protecting the environment, improving education and global health security, as well as boosting the competitiveness of the Rwandan economy.

To operationalize the priority sectors, each year, the European Commission adopts Annual Action Plans, defining specific programmes. In December 2021, EU adopted Annual Action Plan 2021 for Rwanda, including programmes on : Climate-smart and inclusive agriculture (€69M), including a budget support operation and support for agriculture value chains ; Economic Governance and Business Environment (€20,5M), including inter alia support to entrepreneurship, mining and RFDA on vaccine manufacturing.

Programming for the 2022 Action Plan for a total amount of around €85 million is in full swing. EU support will focus on interventions supporting the education sector, including technical and vocational training, consolidating justice reform, accountability, and reconciliation efforts and thirdly, as well as upgrading informal settlements in Kigali

The financing agreement was signed on Wednesday 18th May 2022.