The African Development Bank (AfDB) and the Development Bank of Rwanda (BRD) signed today a US $8-million Line of Credit (LoC) to support BRD lending to the agriculture, agro-processing, telecommunication, education and tourism infrastructure sectors in Rwanda.
The signing ceremony, held in the AfDB national office in Rwanda, was chaired by Negatu Makonnen AfDB Resident Representative in Rwanda, and Jack N. Kayonga, BRD Chief Executive Officer.
BRD is Rwanda’s leading development bank specializing in Small and Medium Enterprises (SMEs) and as part of its 2010–2014 strategy, its key growth areas include priority SME sectors such as agribusiness, manufacturing, micro-finance, information and communication technology, hospitality, education, health care, energy and water. This partnership is expected to increase SME reach, job creation, government revenues and resource mobilization to finance SMEs.
In complement to the LoC, a technical assistance package of up to US $730,800 provided to BRD by the Fund for African Private Sector Assistance (FAPA) and funded by the Government of Japan, the AfDB, the Austrian Development Bank and the Government of Austria will reinforce BRD’s internal operational structures and systems. The grant aims to improve BRD’s staff skills, information technology systems, appraisal systems, treasury and financial management, operations, credit risk management and internal controls.
Jack N. Kayonga, BRD Chief Executive Officer, welcomed the excellent quality of cooperation between AfDB and BRD and affirmed that “the agreement which has just been signed illustrates the vitality of this cooperation which will enable BRD to be engaged in a program of reinforcement of its private sector and SMEs operations in Rwanda.” Emmanuel Murangayisa, BRD Director of Finance, added that “this grant will contribute optimizing BRD management capacities, by which the Bank will able to be placed at a constant and favourable level of performance.”
In his speech at the signing ceremony, Makonnen, AfDB Resident Representative in Kigali, thanked the Japanese and the Austrian Governments and people for their contribution to boost the private sector development in Rwanda. Makonnen said: “The AfDB line of credit and the FAPA technical assistance are aligned with AfDB’s private sector operational priorities for long-term financing to support private sector development especially where long-term financing is scarce. This program will enable BRD to respond effectively to the challenges of developing and promoting the private sector and SME development Rwanda”
Through FAPA funds, AfDB has initiated a broad program for institutional capacity building to support the African Development Finance Institutions such as the West African Development Bank (BOAD), the East and South African Development Bank (PTA Bank), the East African Development Bank (EADB), the Bank Congolaise de l’Habitat (BCH) and finally Shelter Afrique (specialized in housing finance in Africa).