Challenge
In Rwanda, more than three-quarters of the country’s labor force works in agriculture and coffee is a key crop that generates a significant share of export earnings. But a decade ago, after years of minimal upkeep, the country’s coffee industry was showing its age. Outdated farming processes and facilities prevented the country’s small coffee farmers from maximizing yields or earnings or participating in the global market.
Solution and Impact
Political risk insurance supported Rwanda Trading Company (RTC) in a project to modernize the country’s coffee industry. RTC, a unit of Westrock Coffee Holdings LLC of Little Rock Arkansas, rehabilitated a coffee mill in Kigali as well as five coffee cherry washing stations around the country. It also established technical assistance and training programs to help introduce modern farming practices including the use of compost and fertilizer.
These investments helped transform Rwanda’s coffee sector by investing in facilities, training and sustainable farming and business practices, and by connecting farmers with international buyers
To date, more than 31,000 local farmers have enrolled in RTC’s training program. On average, farmers who completed this training have increased their yields by 149 percent.
The quality of coffee produced in Rwanda has also improved. Rwanda had long been known for a mid-quality brand of coffee known as Rwanda Ordinary, but today the majority of its coffee is a quality specialty blend that generates a higher price for farmers. RTD exports approximately 25 percent of the country’s specialty production to hundreds of retailers and roasters around the world, including Starbucks and Peet’s.
Increased farming incomes have given new opportunities to families, enabling more of them to save, send their children to school, and invest in a higher quality of life.
One farmer group in a rural part of southwest Rwanda organized a savings group to pool their extra income and after about six months, they had enough cash to hire a technician to connect their neighborhood to the electricity grid. For the first time, they had lights in their homes and in their local shops. New businesses opened and existing businesses were able to stay open longer, elevating the quality of life across the community