The African Development Bank (AfDB) and Government of Rwanda have endorsed two financing agreements that will support skills development in the energy sector and improve revenue mobilization, tax administration and collection as a way of attaining the goal reducing Rwanda’s dependence on donor aid.
The assistance is timely as Rwanda continues to focus on self reliance and will enable the implementation of the Rwanda’s Poverty Reduction Strategy and respond to bridging the skills gap forms in the education through responsiveness in matching skills needs to emerging and priority economic sectors, while also catering to youth employment.
The funding also comes at a time when President Paul Kagame, during the 11th national dialogue raised concerns over the need to increase access to electricity and water to all Rwandan communities and bridging the skills gap.
The Rwandan Government plans, in the energy sector, to have 70% of the population connected to electricity by 2017 with a 1000 Mega Watt national grid.
Through the Support from the Governance Trust Fund (GTF), a total of US $482,700 grant will be used to establish a modern and efficient local government revenue management system in three urban local governments – the districts of Gasabo, Nyarugenge and Kicukiro.
The funds will be specifically used in four key activities including: customization of a revenue management software license; installation of the software and conducting robustness tests in the three districts; development of business processes for the revenue management system; and conducting change management for tax administration staff in the three districts and Rwanda Revenue Authority (RRA).
Rwanda’s tax body has so far put in place electronic billing system. In addition to improving local government revenue mobilization, the Rwanda automated local government revenue management system is expected to improve access to local government revenue information through an online portal allowing local citizens to hold their leaders accountable on the utilization of these revenues, and thus improve demand-side accountability and public service delivery.
While a total of US $800,000 grant provided through The Fund for African Private Sector Assistance (FAPA) will be used in the development of critical skills in the energy sector in line with an aim of increasing the energy generation capacity from the current 110.8 MW to 563 MW by 2017-2018.
The overarching goal of the FAPA technical assistance grant is to finance certain expenditures required for Rwanda Skills Development in the Energy Sector that will contribute to increasing the competitiveness and productivity of public and private companies operating in the energy sector, through the provision of employable and skilled human capital.
The Fund for African Private Sector Assistance (FAPA) is a multi-donor thematic trust fund that provides grant funding for technical assistance and capacity building to support implementation of the Bank’s Private Sector Development Strategy. It has to date has provided US $42 million to 47 projects across the African continent.
While the GTF total financial commitments of US $6.8 million from the Governments of Norway, Sweden and Switzerland, and the Nordic Trust Fund for Governance and has provided support to 21 projects across the African continent.