Press Release

OPEC Fund supports road upgrade in Rwanda with
US$10 million loan

33/2005 April 18, 2005, Vienna, Austria

The OPEC Fund for International Development has signed a US$10 million loan agreement with the Republic of Rwanda to co-finance upgrading of the Gitarama-Mukamira road, a vital stretch linking the capital, Kigali, to Lake Kivu and neighboring Congo D.R. The main objective of the project is to reduce the isolation of rural areas and promote economic growth and sub-regional integration.

Landlocked and with no rail system, Rwanda relies heavily on its road network, both for the transport of exports such as coffee, tea and sugar, and for the nationwide distribution of imports. The free movement of goods is constrained, however, due to the poor condition of the network, which was severely damaged during the war.

The project region is largely rural, with 80% of the working population earning a living through agriculture. As well as producing both cash and food crops, the region also manufactures agro-industrial, mineral and artisanal goods. Although the project road is the main transport corridor within the region, it has been poorly maintained and its gravel surface floods easily during the rainy season, making the route impassable.

Under the project, the existing road will be reconstructed and upgraded to an all-weather asphalt road over a length of 102.6 km, including drainage works and the installation of traffic signs.

It is anticipated that the new road will cut travel time in half and provide a safer and more reliable form of transportation for the region’s 1.7 million inhabitants. This will help encourage agricultural productivity and economic growth and allow better access to social services and markets, including export markets.

The OPEC Fund has previously financed 16 operations in Rwanda. Three loans were extended as balance of payments support, one financed a commodity imports program, one was given as debt relief within the context of the Heavily Indebted Poor Countries (HIPC) Initiative and 11 supported projects in the agriculture, energy, multi-sectoral and transportation sectors. The country has also received a number of grants from the Fund, including one to cover its subscription to the Common Fund for Commodities.

The latest agreement was signed in Washington D.C. by H.E. Dr. Donald Kaberruka, Minister of Economic Planning and Finance of the Republic of Rwanda, and by Mr. Suleiman J. Al-Herbish, Director-General of the OPEC Fund.

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