Project Case Study
A climate fund for Rwanda
Assisting in the design of a climate change fund for the Rwandan government
As a country experiencing rapid growth, urbanisation and changes in economic structure, Rwanda is particularly vulnerable to the effects of climate change. It already suffers from the extremes of flooding and drought, desiccating its agricultural land and infrastructure systems.
These extremes are only expected to worsen as global temperatures rise, and as such the government of Rwanda are making real efforts to address this problem for now and for the future.
Rwanda’s Green Growth and Climate Resilience Strategy (RGGCRS) identifies how climate resilience and low-carbon development can be integrated into the country’s Economic Development and Poverty Reduction Strategy. It lays out a range of activities split between mitigation and adaptation, the majority of which are financed by FONERWA, Rwanda’s climate change fund. Adam Smith International assisted in the design of the fund, linking international best practice with Rwanda’s needs.
FONERWA has become the principal means of providing access to finance for the Green Growth and Climate Resilience Strategy. Beginning with a reasonably simple organisational and financial structure, it provides project-based grants to government agencies, businesses and NGOs involved in adaptation and mitigation activities. It is expected that in time it will deliver more complex financing mechanisms, including potentially performance-based grants, loan guarantees, lines of credit and public venture capital.
The design required close work with six government ministries, the Rwandan Environmental Management Authority, the Rwandan Natural Resource Board, the Private Sector Federation and its members, and a number of NGOs. As a result FONERWA has strengthened the ability of stakeholders in the finance, environment and climate change space to discuss innovations and build partnerships around sustainable finance for climate environment and development.
“The FONERWA design work reinforced understanding and laid a firm foundation and national momentum and support for sustainable financing of climate change and environment management.”
Dr Rose Mukankomeje, Director General Rwanda Environment Management Authority