Rwanda has become a champion in fighting impacts of climate change. Several initiatives and actions in place are now bearing fruits. Among many others, Rwanda Green Fund, is a model that speaks loud. We met Teddy Mugabo the CEO of the Fund to elaborate on ambitious projects that will require $ 11 billion budget in the next ten years and here are the excerpts.
It’s almost 10 years since the establishment of the Rwanda Green Fund, tell us about the work of the Fund and what has been achieved so far?
The fund was launched in 2012, as a proactive response to the increasing threats posed by climate change to Rwanda and the economy. We mobilise funds to protect our environment, for the benefit of the Rwandan people, as we try and tackle the existential threat of climate change.
Since then, we’ve mobilised US $217, invested in 45 projects across the country, created more than 161,000 green jobs, fostered new green industries like e-waste management and restored forests, wetlands and watersheds.
We have ambitious plans to continue this progress into the future and are always seeking international partners who are, like us, committed to delivering innovative projects in order to make Rwanda and our world, greener and more sustainable.
How is the Fund supporting the country’s implementation of its Climate Action Plan?
The cost of Rwanda’s Climate Action plan is estimated to be $11 billion dollars over the next decade. The plan details mitigation and adaptation projects to shield Rwandans from the worst of our changing climate. The Fund’s investment in projects is already contributing to building communities’ adaptive capacities through innovative agricultural practices and our plans for the future will make a vital contribution to the action plan.
However, given the scale of the challenge we face, and the cost of our ambitions, the Fund will need to play a vital role in raising significantly money from outside investors. This isn’t an easy task, however we believe Rwanda is one of the best place in the world for green investment. This is because Rwanda works for investors. We have the plans, ambition and good governance and systems required to deliver cutting edge projects, delivering great value for money, and we think green investors will support us in increasing numbers.
How are you working with partners to accomplish your strategic objectives and what are the Fund’s key priorities as you also aim to raise more resources to support Rwanda’s Climate Action Plan?
No country can tackle climate change alone. We must all work together to share best practices, collaborate and innovate. Climate change doesn’t respect national borders, it is a global challenge that needs concerted efforts. At the Fund, we’re working hard to attract the investment needed to finance the action plan, and international partners will be vital to do this. As our projects have already been recognised globally, we’re hopeful that institutions and investment groups will continue to back us.
Rwanda’s ambitious Climate Action Plan commits to reduce greenhouse gas emissions by 38% by 2030. For the country to implement the plan, it requires finance of USD11 billion. Where is the country today and what sectors have to play a key role to ensure this is achieved?
A challenge of this scale requires a response which matches it in ambition. This is the reason that Rwanda has set out such a bold plan, and why we’re strongly determined to deliver on it. We need an all-of-government, cross-sector effort deliver this plan – all the way from the national level to the local level – we all have a role to play.
We have already made good progress on attracting investment, but this is just a start and we need to up our efforts to show investors why Rwanda is the right place for green investment. We think Rwanda has already shown ourselves not only a reliable partner for investors, but also the best country for green investment. Our pro-business policies, combined with our good governance, and our investment in high tech industries and education means we’ve created the conditions to deliver on our ambitious policies, and provide investors with a great return on their investment.
Attracting climate finance as well as raising required funds to finance the national climate needs is not an easy job. As the Rwanda’s Green Fund, what are your strategies put in place to overcome this? Can you share with us plans ahead to ensure you increase your funding capacities?
Well firstly, it is a question of continuing to build on our relationships with existing partners. We are excited to meet with a number of bilateral and multilateral investors in the fund at COP26 and at other events in the coming months. Many of our partners have been with us from the start, and we hope to continue to strengthen these partnerships in the future for the benefit of the fund.
We are also planning on building new relationships with private sector institutions. Rwanda is positioning itself as an ideal location for investment in our region through institutions like the Kigali International Finance Centre (KIFC) and the Development Bank of Rwanda (BRD). We are currently working with KIFC on a sustainable finance roadmap, which we hope will allow us to build towards a ‘blended finance’ model, rather than relying purely on grant financing.
We are working closely with our partners such as the Development Bank of Rwanda to diversify our financial instruments. For instance, a Green Investment Facility which is being designed using the “green bank” model. The facility will catalyse private investments in Rwanda, with a unique and specific focus on blended finance by providing financial instruments to projects that are commercially viable – but not yet bankable – in the green sector.
Climate change is a serious threat to the world, but also it presents great opportunities which people should be tapping into. What are your thoughts on this and how can Rwandans, especially the private sector, benefit from it?
To address the climate emergency, we need innovation. Rwanda has proved that it is a regional hub for innovation, and I am hopeful the fund can help to finance some of Rwanda’s most exciting innovation projects in the years to come. This would not only be good for Rwanda, but create technology and knowledge that can be shared across the world.
This is why we have recently launched the Incubator and Accelerator Program, which aims to help to incubate start-ups and accelerate scalable ventures aimed to deliver Rwanda’s climate agenda while creating quality jobs. These are the types of opportunities that we hope Rwandan entrepreneurs will seize.
Rwanda is participating in the UN Climate Change Conference known as COP26. What is your expectation for the event and how can Rwanda benefit from it?
This meeting is among the most important climate summits in history. We are hoping to achieve positive results for the world, and for Rwanda in particular. From the Fund’s perspective, we are hoping to see new commitments on climate finance for the developing world. It is well-known that the target of $100 billion of yearly investment to climate action in the developing world has not yet been met. This target must be achieved, and new commitments must be made to fund tangible action on the ground that benefits all Rwandans.