Running Kigali Farmers’ And Artisans Market and working for both SMEs and corporates in the food industry, has afforded me the opportunity to see firsthand, the many, many gaps in the Rwandan market. Today however, I shall focus on the agri-business side of things. The market was, and still is, one way to help bridge these said gaps, but this is a very small solution to a bigger problem that Rwanda and many other African countries still have a lot to work on.
So, what’s the big ‘secret’ in unlocking and fully exploiting agriculture in Rwanda? The answer is very simple yet complex…value-Add. By definition, value-added agriculture entails changing a raw agricultural product into something new through packaging, processing, cooling, drying, extracting or any other type of process that differentiates the product from the original raw commodity. Other definitions describe value-add as one increasing the economic value of a commodity through particular production processes that increases the value of the product to the consumer. Whichever the definition, the value addition activity is very important to the farmers because, it increases the value of the raw materials and enables the farmer to fetch better prices from the market. Value addition in rural areas can take many forms including cleaning, preservation, sorting, packaging, processing a raw material into some form of canned food and branding of agriculture products.
How is Value-Add the big secret solution to a lot of the agri-businesses based in Rwanda?Let’s look at a few statistics to help us understand this a lot better;According to the National Bank of Rwanda Statistics, Rwanda generated $463.16 million from exports in the first six months of 2018, up from $375.91 million in the same period 2017. Rwanda’s exports accelerated in the first half of 2018, driven by Government’s efforts to support the Made-in-Rwanda agenda as well as good performance of non-traditional exports, helping to bridge the country’s trade deficit. Traditional exports such as coffee, tea, minerals, flowers and pyrethrum all grew by 28.7% while the Government incentives to support the Made-in-Rwanda initiative drove growth of textiles by 158.8%.
How incredible is this? The Government of Rwanda introduced the ‘Made in Rwanda’ initiative in 2016, which was intended to:
· Boost consumption of locally-produced products· Enhance quality, standards, branding and packaging of locally produced products along the value chain · Change the mindset of the Rwandan people toward locally-made products· Boost value addition along the value chain of productionThe Minister for Trade and Industry called it a “comprehensive, campaign through a robust awareness campaign.” He further added, “We are calling upon producers to conduct intensive publicity about their products so as to complement the sustainability of the campaign,” he said.
What does this mean to you as a potential investor in Rwanda? Half the work is done for you in the value-add sector, as this is a top-down, intensive approach to ensure this is a success.Now, let’s face it, the value-add sector is extremely broad but as you can see, it has already been narrowed down to Made-in-Rwanda (which is one of the core objectives that drives our market by the way).
So how do you know where to start especially if you are new to the country or have lived here all/part of your life?One of the main keys to starting any business is solving an existing problem. Unless you are a gifted one like Einstein, it’s not easy to invent something but, it is definitely easier to NOT reinvent the wheel and just look at how you can solve the myriad of challenges Rwandan farmers are facing.
What are these challenges?According to Fortune Africa, and I whole-heartedly agree with them, they are:
- Low quality produce as most production is intended for own family consumption hence local farmers do not have strong incentives to increase quality.
- Lack of business skills and entrepreneurship.
- The rural road infrastructure and transport is not yet fully developed to enable the farmer to promptly get farm input and also transport the farm produce to the market.
- There is lack of sustainable market and post-harvest management for the small scale farmers in Rwanda.
- Limited capital to develop the farms and local farmers also do not have easy access to funding from commercial banks.
- The latest market information is not readily available to the small scale farmers and this results in the farmers selling at cheap price in order to avoid spoilage of agricultural products.
- Shortage of fertile land
- Lack of knowledge about modern farming methods including irrigation.
- Lack of necessary equipment to use on the farm during planting, harvesting and value addition.
- Lack of adequate supporting infrastructure to the sector like cold rooms, advisory services to the small farmers and mechanism for the small farmers to pull resources.
All these challenges affect value-add progress and if you can find a solution to one or all of the problems, you my friend have found a potential agri-business to start.
You have a solution, now what?Assuming your solution came about by doing extensive research and you’ve narrowed it down to a line of business you want to start, the next step would be to register the business. Rwanda has the fewest procedures and fastest processes in the whole of East Africa and possibly the world to register and start a business. It takes a few hours for this to be complete.You can register your business online at http://org.rdb.rw/ or at the Office of the Registrar General which is a department within the Rwanda Development Board located in the Kigali the capital city.
What other agencies/companies/Government bodies can be of help to you once you have registered and are starting/started the business? (This is by no means an extensive list but it is a good start/guide)
It would definitely be a miss if I didn’t mention the market.
Kigali Farmers’ And’ Artisans’ Market is a community market that offers a platform for producers, such as yourselves, who are developing, testing, introducing new value add products to the market. We connect you directly to consumers so that you can build and/or expand your brand ‘real time’. You can reach us on +250781446543 on both for calls/Whatsapp or you can drop us on email on firstname.lastname@example.org
National Agricultural Export Board –Their vision is to be a world class agriculture and livestock commodity export development enterprise through innovation
Ministry of Agriculture and Animal Resources Rwanda –Provide farmers and consumers of agricultural products with information, techniques and services meant for improving their profession and supplying the internal market with increased and quality production thereby raising their agricultural and animal husbandry income
Rwandex Chillington-Provides agricultural materials
Balton CP Rwanda-They supply everything that is required for growing crops and rearing livestock, along with expert advice on cultivation, animal husbandry and post-harvest solution
Inyange Industries-Produce various products ranging from water, milk and other milk products and juices
Rwanda Tea Authority-They produce and supply high quality teas to both local and international markets
Sorwatom SA Rwanda-Tomato processing plant
SodrisAgri Rwanda-Provide agricultural equipment and products
Remember to #buylocalsupportlocal and take time to #visitrwanda to see all the other amazing opportunities there are to invest in.
The author, Flo is the founder of Kigali Farmers’ And Artisans’ Market and is extremely passionate about community building focusing on the youth, women and PLWD running SMEs, micro and home industries.
Disclaimer: The opinions stated here are of the author and it’s imperative that one does their own extensive research before undertaking any kind of investment