Sugar Industry Turnaround



Situation:

For years, sugar cane farmers, as well as Rwanda’s sole sugarcane processor, Kabuye Sugar Works (KSW), have faced restricted production because of a shortage of suitable land for sugarcane agriculture. In addition, severe flooding and deficient drainage constrains optimal yields on existing land, forcing Rwanda to import much of its sugar, and leaving consumers highly dependent on volatile prices. With a growing population and increasing consumer expenditure, both domestically and regionally, Rwanda risked missing a crucial opportunity to grow a local industry with great potential.

Karisimbi Partners’ Approach

Karisimbi Partners supported $10 million of investment over 5 years through a public-private-partnership (PPP) aimed at increasing sugarcane production, improving value chain competitiveness, introducing new technologies and strengthening policymaking in the sugar sector. With financial support from the Dutch Foreign Ministry, Karisimbi Partners facilitated water engineering experts, Royal HaskoningDHV, to help Kabuye Sugar Works (KSW) solve the problem of persistent water stagnation. Through its role as a trusted agent, having supported KSW in various activities over multiple years, Karisimbi Partners was instrumental in securing KSW’s near match of the Dutch Government’s 50% project funding. As part of the project, Karisimbi Partners also formed a partnership with Milan Innovincy and engaged Wageningen University of the Netherlands to integrate state-of-the-art sugarcane crop monitoring.

Results

In 2014, the Dutch Ministry of Foreign Affairs presented the “Sugar: Make it Work” partnership with the “Best Public-Private-Partnership Award,” noting its strong initial results, comprehensive solutions and dedicated participants. The partnership is making critical investments in water management infrastructure in order to reduce flooding so that KSW and outgrower farmers can make the most of available marshland. Within the next decade, through improved water management and the introduction of remote sensing technology, local production of sugar will nearly double following the reclamation of 1,500 hectares for agricultural production. This will lead to an increase in outgrower and KSW estate employment by over 40%, as well as add new highly skilled agro-IT service jobs in the sugarcane sector. Sugarcane farmers that were informally collaborating in associations and groups are already operating in officially recognized and well-organized cooperatives. With improved capacity to track and monitor crops, KSW and outgrower farmers will be in a better position to predict sugarcane yields, respond to disease outbreaks and optimize harvesting and transport of crops.