The Government of Rwanda and the Federal Republic of Germany today signed a financing agreement worth € 13.7 million (approximately RwF 12.5 billion).
The financing agreement which is in form of grant will support decentralization, good governance and climate resilience.
According to the agreement, decentralization and good governance will be allocated € 7 million (approximately RwF 6.4 billion) under the Local Administrative Entities Development Agency (LODA).
The funds will finance income generation and economic infrastructure such as schools, feeder roads and markets. Projects to be undertaken will be based on priorities stipulated in district development plans.
In line with Government Decentralization Policies and Strategies, districts will be allowed to implement local priorities, thus making them more responsive to specific local needs and enhance local accountability.
The funds will also finance institutional support at the level of RLDSF mainly in the areas of project preparation and planning, monitoring and evaluation and development of a citizen feedback mechanism.
The same agreement also allocates € 6.7 million (approximately RwF 6 billion) to Climate change adaptation which will be channeled through the National Climate and Environment Fund (FONERWA).
This grant will increase climate resilience in the 30 districts of Rwanda and reduce vulnerability to extreme climate events. It will also foster the creation of awareness on climate change issues and mainstreaming of climate change into the district development plans.
The Minister of Finance and Economic Planning Claver Gatete said: “This grant will not only support rural development and create employment opportunities; it will help to tackle effects of climate change. It is in line with rural development priorities as stipulated in the EDPRS2.”
The Germany Ambassador to Rwanda Peter Fahrenholtz said: “This Agreement underlines the long-standing and proven cooperation between our two countries based on friendship and mutual trust. Germany is committed to fight climate change.”
The Federal Republic of Germany under its development organization KfW has been supporting decentralization through local infrastructure investments since 2006 and has financed individual projects such as schools, health centers, electrification, roads and bridges, modern markets and terracing among others worth € 27 million to date.
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