Central Data Catalog

Citation Information

Type Report
Title Rwanda Agricultural Sector Risk Assessment
Author(s)
Publication (Day/Month/Year) 2015
Publisher World Bank Group
URL https://openknowledge.worldbank.org/bitstream/handle/10986/22936/Rwanda000Agric0ctor0risk0assessment​.pdf?sequence=1
Abstract
Rwanda has experienced a remarkable recovery since the civil war, with high growth
since the mid-1990s; gross domestic product (GDP) has grown 10 percent per year on
average. Agriculture is the dominant sector of the economy, contributing a third of the
country’s GDP and about half of Rwanda’s export earnings. Because about 80 percent
of the population lives in rural areas and is engaged in agriculture to some extent,
increasing agricultural productivity is key to improving incomes and decreasing poverty.
The government of Rwanda (GoR) has therefore made agricultural development
a priority and allocated significant resources to improving productivity, expanding
the livestock sector, promoting sustainable land management, and developing supply
chains and value-added activities. As a result, the sector grew an average 5 percent per
year over 2002–12, which is rather high although it fell short of both the government’s
own objective of 8–9 percent annual growth for the period (revised to 8.5 percent
for the next years in the new Strategic Plan for the Transformation of Agriculture in
Rwanda, PSTA III) and of the Comprehensive Africa Agriculture Development Programme
(CAADP) commitment of 6 percent growth in the agriculture sector.
At the same time, Rwanda’s agriculture sector faces a series of challenges. Agricultural
land plots are very small (80 percent of land holdings are less than 1 hectare [ha],
often divided into three to four plots), and over 70 percent of agricultural land is either
on hills or on the side of hills. Agriculture is dominated by small-scale, subsistence
farming under traditional agricultural practices and rain-fed agriculture. As a result,
average crop yields are low compared with potential yields, and crops are exposed to
risks such as weather-related shocks and pest and disease outbreaks. Current agricultural
policies are geared to increasing productivity in the sector by achieving scale in
agricultural production.
Risks can potentially have significant implications on stakeholders, investments, and
development in the agriculture sector. Adverse movements in agricultural commodity
and input prices, together with production-related shocks (for example, from
weather, pests, and diseases), not only affect farmers and firms active in particular
xii Rwanda
supply chains, but may also put severe strains on a government’s
resources. Rapid or significant declines in production
and/or trade may reduce government tax revenues,
affect balance of payments, necessitate compensatory (or
recovery) expenditures, and/or otherwise adversely affect
a government’s fiscal position. The prevalence of “shockrecovery-shock”
cycles vastly reduces the ability of many
countries to plan for and concentrate on real development
issues. The purpose of this report is to assess existing risks
to Rwanda’s agriculture sector, prioritize them according
to their frequency and impacts on the sector, and identify
areas of risk management solutions that need deeper specialized
attention.

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