An hour’s drive east of Kigali is the Nyagatovu model village, a 90 home settlement and one of the showpieces of the Rwanda’s attempt at eliminating poverty.
The settlement is built on the premise that by concentrating families and their resources, farm productivity can be improved, services can be delivered more effectively and subsequently incomes will be boosted and poverty will be shood out the door.
Barely two years into the project and the settlement has begun selling surplus matooke to local markets and Kigali, they have forty head of dairy cattle in a fast growing herd and they have several tomato green houses.
The village’s young eager leader Jean de Dieu Ntirenganya tells me he moved to the settlement a year ago and can see the light at the end of his tunnel.
“We had our small plots and were just growing food for eating and it was not enough, now not only do we have food for ourselves but we are now selling and making money, and there is still a lot of land,” the 25 year-old said.
Under the program, which is being rolled out to all the 30 districts of the small east African nation, consultation and sensitatisation of the communities leads to resettlement – where beneficiaries exchange their land for land at the earmarked sites and join up to 150 other families.
At the settlements government builds each family a two bedroomed house, in addition each family gets a cow, to improve family nutrition, income and whose waste is employed as manure in the fields. Each family also gets about four acres of land in a consolidated tract of land. At Nyagatovu the crop they concentrate on is matooke and more recently tomatos.
For all intents and purposes Nyagatovu is now a urban center, with lines radiating from power poles into homes and roads quartering the more than 50 acres of residential area.
I am suspicious of government handouts – or handouts of any type. Our guide Emmanuel Mugabo of the Local government ministry said they were aware of the dangers of this government largesse and ask every family to build their own kitchen and pit latrine in order to get buy into the project and ensure sustainability.
The Chinese collectives of the 1960s and 70s, on which this scheme seems to draw a lot of lessons, were successful in raising farm output but failed because the farmers were restricted to selling their produce to the government. In Rwanda the settlements sell their produce on the open market not only getting better than market rates but being paid cash.
At the heart of the poverty challenge is poor productivity, before you even talk about access to markets.
In explaining the historical wealth divide between the more developed northern versus the poorer southern economies of the world, is the fact that agricultural surpluses thanks to the agrarian revolution of more than 600 years ago, have been registered in Europe and later America ever since. These surpluses meant two things, that those societies could sustain thinkers – inventors and administrators as well as professional armies, which then could project their will abroad and secure markets and raw materials for their industries. By extension in fighting poverty the issue of surpluses has to be addressed.
With concentration of populations, delivery of social services – education and health as well as infrastructure will be more efficient ensuring a better quality of human resource and lower costs of doing business in Rwanda. In addition since each settlement is generating income and wealth financial services follow and all other services like retail trade as well.
The market economy has been shown to be the most effective driver of wealth creation. Market economies evolve and cannot be designed. However governments have a responsibility to create an environment in which markets can thrive. In addition through good governance, nations then mitigate the worst excesses of the market by ensuring good service delivery that can allow everybody a chance at material advancement.
It is still early days but barring bureaucratic inertia, Rwanda is setting itself up to be the real breadbasket of the region. But the implications of this scheme go far beyond that. This model with some variations can be applied to creating clusters of anything from crafts, manufacturing and ICT to make Rwanda the economic hub of the East African Community.