Coffee farmers in Rwanda can expect further support from the Rwandan Development Bank (BRD) in a bid to propel further the prospects of the coffee industry in Rwanda. BRD has committed to support the industry by providing credit lines to farmers, not only in the local currency but in U.S. dollars as well.
Emmanuel Karuranga, Director of Credit Administration at BRD, said the loan funding in dollars will start immediately in 2013 and will be used to drive the growth of the country’s coffee industry.
He however declined to mention the limit up to which a specific amount of loan can be granted, saying this issue will still depend on various factors that may affect the global coffee market – such as price drops, competition, and severe weather conditions, among others.
BRD, however, since March, has already shelled out a total of Rwf8 billion for loans. Half of the credit has already been paid.
Karuranga expressed hope that with the loans farmers will get from BRD, they will be able to put premium on added values in order to uplift the competitiveness of the products in markets outside Rwanda. He also discouraged selling unprocessed coffee at bargained prices saying this will hamper efforts to sustain the growth of the coffee sector.
According to recent figures by the Agricultural Export Development Board (NAEB) of Rwanda, coffee production last year went down to 16.37 million kilograms from 19.32 million kilograms in 2010. Coffee exports sold in 2010, however, grew to US$74.23 million from the previous year’s US$56.08 million, attributed mainly to increase in price per kilogram. The NAEB sees further reduction in Rwanda’s coffee production come 2013 because of excess in production despite the fact that prices in the global market remain high.
BRD has been the sole provider of long-term finance and has significantly facilitated the emergence of different productive enterprises in the private sector. As the government’s investment arm, BRD’s objectives are anchored on the priority sectors of the Rwandan economy.
BRD plans to stimulate about Rwf160 billion into the Rwandan economy over 2010-2014 and grow further its portfolio from Rwf36.1 billion in 2009 to over Rwf178 billion in 2014. The bulk of these resources will focus on stimulating economic growth, accelerating Rwanda’s development agenda and reducing poverty. This investment will create nearly 150,000 jobs which will impact livelihoods of more than 1,000,000 people.