Green party’s Habineza urges government to create a reserve bank out of the fund and pay interests when it borrows from it.

After the success of the Agaciro Development Fund (AgDF) which has so far pulled in over Rwf17billion worth of contribution pledges in less than a month, debate is now turning to how sustainable the fund will be.

Frank Habineza, President of the unregistered Democratic Green Party of Rwanda, who recently returned to the country from Sweden, has challenged the government to come up with a way to make the fund sustainable to ensure that the contributions continue flowing.

Habineza who is back to register his party, urges that a law establishing and governing operations of the fund be put in place and that the government should use the contributions to form a reserve bank which would collect more contributions and pay interests to the people who have contributed. He says that the government would borrow from the bank and this would encourage more people—whom he calls shareholders–to contribute to the bank with expectations that they would get returns on their money.

“It is a good initiative and I have already made my contribution but what we want is a law establishing the fund to be passed by Parliament because at the moment there are no rules and regulations regarding the fund,” Habineza urged during a recent interview with The Independent.

“We also think that a bank should be set up, with shareholders so that government can borrow money if necessary with interest,” he says. Using Banque Commerciale du Rwanda (BCR) as an example, which he says was created by a mere Rwf4billion worth of capital, and it is now one of the strongest commercial banks in Rwanda, Habineza said that the Rwf17 billion worth of pledges to AgDF can start a bank.

Habineza urges that instead of the government borrowing long term loans from multilateral donor organizations like the African Development bank, International Monetary Fund (IMF), and World Bank, it can borrow from Rwandans through the new reserve bank.

He says that if his party is registered, he will engage experts who will draft a conclusive policy on how the idea to create the bank can be implemented.

“At the moment, people are enthusiastic but you cannot count on that every year, so if government manages to collect Rwf50billion and it is used the way I have suggested, then it would be helpful in the long term.”

But the government is also working on a strategy which will provide details on the implementation and sustainability of the fund, according to the Director of External Finance Unit in the Ministry of Finance and Economic Monitoring, Mr. Ronald Nkusi.

“The government is coming up with the Agaciro Development Fund strategy which will detail the implementation and sustainability arrangement of the fund. The fund is conceived as a long term initiative and Rwandans will be voluntarily contributing to this fund every year for at least in a foreseeable future,” says Nkusi.

He says the idea to set up a bank will be determined by Rwandans through the national dialogue (Inama y’umushyikirano) which mooted the idea to create the fund.

The primary objective of the fund as Nkusi explains is to supplement development programs and “catalyze our economic growth and if a certain portion of the fund can be saved for future investments and for the fund sustainability or think of a reserve bank, all this will be determined in the national dialogue.” NKusi says that by Sept. 14, the ministry had over Rwf2 billion in liquid cash out of Rwf17.7 billion pledges to the Fund. By end of the month, adds Nkusi, the government hopes to recover Rwf10 billion from the people who pledged to contribute from their salaries.

“The recovery process is ongoing and the funds will be used to support national development programmes which will be determined by citizens and approved during the National dialogue.”

The fund was launched on August 23 by President Kagame and on the day of its launch, it received Rwf1.2billion worth of pledges in four hours through voluntary donations from Rwandans and friends of Rwanda. During the launch, a Rwandan living in Sudan who made a direct deposit into the fund’s account at Bank of Kigali said she loved the innovative nature of the fund. “People like me, usually send our money back to Rwanda to relatives through remittances but this fund lets me stay actively involved in building schools, clinics, etc, and helping my fellow Rwandans. It’s important that the Rwandans abroad feel connected to the impressive progress that the country is making, and this type of voluntary contribution really helps to maintain that connection.”

Finance and Economic Monitoring Minister John Rwangombwa has been keen to caution that “The fund is not coming to substitute the existing funds or aid suspensions but rather to supplement them.” though the initiative was accelerated when many European countries decided to defer aid due to allegations that Rwanda was supporting Congolese rebels M23.

The fund has not only been welcomed by employees, firms, government agencies but also students. Joan Umurungi, a fourth year student at the School of Finance and Banking echoes the same sentiments with many Rwandans saying that the fund will help the country become financially responsible and also encourage hard work. She later adds that the government needs to come up with innovative ways of encouraging people to contribute annually.

“There is no doubt that the immediate challenge for the government will be how to sustain the momentum of people contributing at the same pace and tune annually. Maybe the government should come with a day for contributing to the Agaciro fund next year, whereby people can contribute in their respective neigbhourhoods or contributions can be done at the sector level,”Umurungi says. Although he agrees that that it is imperative for government to come up with ways of sustaining the initiative, Nkusi says that “there will be no prescription that a Rwandan has to contribute to a certain threshold; it has to be done voluntarily and to what people can afford and are willing to give. If they choose to contribute at the same tune or below that, the Ministry of Finance will be ever grateful to their efforts.” Nkusi adds.

Won’t the funds be misused?

While giving their contribution to the fund, Prosecutor General Martin Ngoga said that his office is ready to step in should there be misuse of the funds.

“We are making this contribution but also assuring Rwandans that we are ready to prosecute anyone who misuses this money.”Ngoga said as he gave a dummy cheque of Rwf100million to the Ministry of finance, custodians of the Fund.

It is not the first time that Rwandans have gone back to their cultural traditions and adapt them to solve contemporary problems.


The independent


  1. This idea from Mr Habineza is good BUT it is not a sustainable idea and it is not an idea of a politician.Why? Mr Habineza fails to recognise these important things:
    1/Contributors : these are Rwandans and they are contributing in frws which have no value at the moment. It is extremely difficult to access foreign currency and international business may fail in the long run.
    2/funding from citizens is not sustainable:people may fail to fund the bank due to unemployment and lack of resources.
    Hence this idea of having a reserve bank can not be viable. The reality is that Agaciro does not exist;just a way of distracting people. Howcan people fund a bank which has no funds in the beginning?

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