Rwanda secures US$47M concessional loan from China for agricultural resilience

RWANDA – Rwanda and China have formalized a concessional financing agreement valued at US$47 million to fund the construction of the Giseke Dam and an irrigation development project in Gisagara District. 

This initiative aims to enhance agricultural resilience to climate change by irrigating 2,640 hectares of farmland.

The agreement, signed on January 22, 2025, aligns with Rwanda’s Second National Strategy for Transformation (NST2), which prioritizes the adoption of water-saving technologies to improve irrigation efficiency and drive economic growth. 

Speaking at the signing ceremony, Rwanda’s Minister of Finance and Economic Planning, Yusuf Murangwa, emphasized the project’s strategic importance. 

“China has consistently supported Rwanda’s development aspirations across key sectors. This project will advance the sustainable transformation of agriculture in line with NST2 objectives,” Murangwa stated.

Advancing agricultural modernization
China’s Ambassador to Rwanda, Wang Xuekun, highlighted the agreement as a milestone in bilateral cooperation. 

“This project represents the tangible implementation of the ’10 Partnership Action Plans’ proposed by President Xi Jinping for China-Africa collaboration. It underscores the consensus between our nations’ leaders and strengthens Rwanda’s agricultural modernization efforts,” Ambassador Wang remarked.

The Giseke irrigation project is expected to directly benefit 915 households—approximately 4,578 individuals—by enabling them to utilize modern irrigation systems for crop cultivation. 

The resulting agricultural output is anticipated to support local markets within Gisagara District and beyond, contributing to the commercialization of produce and rural economic growth.

Context and broader impacts
The Gisagara District, located in southern Rwanda, is known for its agricultural activities, particularly rice farming. 

It also produces cassava, green bananas, potatoes, sorghum, and maize. Enhancing irrigation infrastructure in the district aims to address the challenges posed by Rwanda’s predominantly rain-dependent agriculture.

According to Rwanda’s Ministry of Agriculture, the nation has an irrigation potential of 589,711 hectares, with 47% situated in marshlands and the rest on hilly terrain. 

However, as of 2018, only 48,508 hectares—7.5% of the potential—had been developed for irrigation. 

Investments like the Giseke project seek to bridge this gap, ensuring sustainable agricultural productivity and food security.

Agriculture is a cornerstone of Rwanda’s economy, contributing 27% to the national GDP and employing 56% of the active workforce. Expanding irrigation systems remains a key strategy to boost productivity, enhance food security, and improve livelihoods in rural areas.

Rwanda-China economic partnership
Economic cooperation between Rwanda and China spans several sectors, including infrastructure, education, health, and geology. 

China’s financial contributions to Rwanda, through grants and concessional loans, currently total US$600 million, with US$450 million in concessional loans and US$150 million in grants.