By Elias Hakizimana.
Social Democratic Party (PSD) has pledged to advocate for establishment of an agricultural and Livestock Bank to Rwandans to boost financial investment and improve the livelihoods of farmers through increased farm production and income.
The message was delivered by PSD’s parliamentary candidates to Kicukiro District’s citizens on August 20, 2018 during the ongoing parliamentary campaigns and this is among many manifesto they brought on board as key areas to put their efforts as they win elections.
Georgette Rutayisire, a parliamentary candidate said that the bank will help in promoting investments in agriculture and livestock so that Rwandans can improve their welfare.
Rutayisire said that the bank will help farmers to easily access to loans and insurance on losses caused by climate change effects on their yields.
Why a special bank for agriculture is needed
Farmers have been saying that agriculture as a sector that accounts for 30 per cent of the country’s GDP and employs about 70 per cent Rwandans, needs a dedicated bank.
Loans to agriculture declined by 4 per cent from Rwf29.8 billion in 2015 to 28.6 billion in 2016, according to the Monetary Policy and Financial Stability Statement released in February 2017 by the National Bank of Rwanda (BNR).
The same publication sated that mining and agriculture were the two least financed sectors in 2016 with 0.1 and 1.8 percentage share respectively of total 1,407 billion bank loans that were given to 10 sectors financed in December 2016 in the country.
The share of mortgage loans – loans that can be used to purchase a property, and that is secured against the property itself – was the highest – 34.7 per cent – of 10 sectors financed in December 2016; followed by commercial and hotels loans with 32 percent share.
Some farmers claim that the current loan system in Rwanda is not favourable to farmers as a farmer has to repay loans on a monthly basis, yet they get money such as for repaying the loan after a season (about four to six months).
Over 40 percent of Rwandan farmers use quality improved seeds. The use of chemical fertilisers stood at 32 kilogrammes per hectare in 2016, while the targeted is 45 kilogrammes per hectare by 2018, which call for more efforts so as to improve agricultural yields.
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