WASHINGTON, October 31, 2014 – The World Bank’s Board of Executive Directors today approved two International Development Association (IDA)* credits totaling US$200 million. The first program will enhance Rwanda’s public financial management and statistics systems in order to make better informed decisions on the use of its public expenditures. In addition the second program will focus on enhancing food security and nutrition, increasing crop yields and expanding the private sector role in agriculture.
The two programs approved today will both utilize the Program for Results (PforR) financing instrument in order to improve the efficiency and effectiveness of government expenditure programs and help build institutions and capacity under the programs being supported.
“The Government of Rwanda’s budget strategy is aligned to its national development objectives of eliminating extreme poverty and inequality. However, aid fluctuations constrain implementation of government expenditure programs,” said Carolyn Turk, the World Bank Country Manager for Rwanda. “Anchoring disbursement against results by using the PforR instrument will enhance the predictability of budget financing and allow the government to allocate resources to priority areas such as improving rural food security and nutrition, boosting private sector investment in agriculture and increasing famer’s incomes.”
The Public Sector Governance Program with funding of US$100 million will boost the government’s statistical capacity to make evidence-based policy decisions and improve its planning and budgeting. This will contribute to more efficient and effective use of public resources. It will focus on accounting, auditing, budgeting and reporting in both national and subnational governmental institutions.
“Improving transparency and accountability is especially important at the subnational level, because local governments in Rwanda have important service delivery responsibilities, said Yoichiro Ishihara, the World Bank Task Team Leader for the Public Sector Governance Program. “The program will increase the availability of good development statistics that can better target government expenditures and continuously measure their social and economic impact which will ultimately improve the effective use of public resources.”
While Rwanda has registered strong economic growth over the past decade, 45% of Rwandans still live in poverty, especially in rural areas.
The Transformation of Agriculture Sector Program Phase 3 with funding of US$100 million will support the Government of Rwanda’s strategic objectives to transform Rwanda’s agriculture. With the potential of lifting almost 3 million people living in rural areas out of poverty, the program will focus on raising famer’s income through diversification of crops, better use of input to combat land erosion, improving irrigation, and increased private sector investments. The PforR will reinforce and strengthen the government’s delivery of key agricultural services, and put in place processes to expand the role of the private sector.
“Enhancing food security and nutrition particularly for rural farmers in Rwanda involves tackling multiple dimensions to improving crop yields, nutritional outcomes and increasing rural incomes, said Mark Austin, the World Bank Task Team Leader for the Transformation of Agriculture Program. “The program will help generate greater benefits to rural farmers through improved agriculture and animal resource intensification practices, research and technology transfers and professionalization of farmers, value chain development to encourage more private sector engagement, and institutional capacity development on cross-cutting agriculture issues.”
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing zero-interest loans and grants for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 82 poorest countries, 40 of which are in Africa. Resources from IDA bring positive change for 2.5 billion people living on less than $2 a day. Since 1960, IDA has supported development work in 108 countries. Annual commitments have increased steadily and averaged about $16 billion over the last three years, with about 50 percent of commitments going to Africa.