New Funding Agreement to Take Rwandan Specialty Coffee to the Next Level
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Kigali, Rwanda│Wednesday, November 29, 2006
USAID/Rwanda is taking a new approach to its already successful efforts to establish and build Rwanda’s specialty coffee sector -- which has grown from non-existent to an expected $8.5 million this year.
USAID/Rwanda has signed a new five-year cooperative agreement with the Borlaug Institute of International Agriculture at Texas A&M University and the National University of Rwanda. “Sustaining Partnerships to Enhance Rural Enterprise and Agribusiness Development” (SPREAD) is a total $6 million, five-year project designed to improve the livelihoods of thousands of Rwandans by focusing on a value chain approach -- that is, by improving all the links in the marketing chain from producers through processors, distributors, wholesales and retailers, to consumers. Or, in the case of Rwanda’s growing specialty coffee market, the value chain can be described as “from the seed to the cup”.
USAID’s previous six-year investment in Rwandan specialty coffee sub-sector concentrated on working with individual stakeholders in this value chain. The new approach concentrates on working with umbrella organizations and companies that serve their stakeholders and directly impact more than 50,000 rural Rwandan families. As the program expands, other sub-sectors will be targeted based on their production potential, opportunities for investment, efficient and sustainable use of resources, increased use of technology, and increased participation by the private sector.
The SPREAD program also plans to promote trade and competition by encouraging changes in public policy and improving access to services. It also anticipates creating an advocacy environment that will strengthen small holder organizations, such as Rwanda Small Holder Specialty Coffee Company and Rwanda Fine Coffee Association, and help them maximize their members’ profits.
SPREAD director Dr. Tim Schilling says the project’s components have been carefully designed for maximum impact and sustainability, and that Rwanda already comes to the high value agribusiness niche market with competitive advantages.
“Consumers worldwide are demanding higher quality products and are willing to pay more for them,” Schilling says. “They also want traceability – that is, they want to know where their food and beverages are grown and the socially and environmentally beneficial practices used in their production. More and more consumers are advocates of ‘farmers first’, meaning they’re interested in food products that are bought at fair prices to the rural small holders producing them. Finally, never before has Africa been in the hearts and minds of the global population with consumers wanting to support African products, and Rwanda’s special story of crisis and rebuilding is particularly compelling.”
According to USAID/Rwanda Director Kevin J. Mullally, the SPREAD project goal is to strengthen the relationship model of production by not just reacting to market forces, but by also creating a connection that cycles from producer to consumer, and back again.
“We want to see a more efficient and sustainable approach to capacity building in this sector,” Mullally explained. “In our previous projects, we worked one-on-one with producers and with investors in the specialty coffee sector. Now, by working with the producers’ own management companies, we can ensure quality every step of the way so that the best of the best product can be shipped to the roaster who pays top dollar for it, which in turn increases the income at the producer level.”
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