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May 18, 2011

Drought to hit Rwanda 2011 farm output

Growth in Rwanda's agricultural output is seen slowing to 6 percent in 2011 from 7.1 percent last year due to a drought late in 2010, the country's agriculture minister said.

The eastern-central African country has invested in new agricultural production to raise food and export output, with agriculture a mainstay of recent economic growth.

"Agriculture growth this year will not be as good as the previous year's because of a drought at the end of last year, so we expect around 6 percent growth," Agnes Kalibata said a conference."Next year we go back to our original plan, 8 percent growth," she added.

Rwanda, rebuilding after a genocide devastated the country over a decade ago, has been investing heavily in the agriculture sector, with allocations from the state budget increasing to 10.2 percent in the current financial year from 2.7 percent in 2007.

Kalibata said increased agriculture investment would pave the way for Rwanda to reduce its dependence on two of its main imported crops -- rice and wheat.

"We are investing very strongly in irrigation systems that will see (rice) imports going down in the next three years," she said. "We will probably be importing about 10 percent from 40 percent now by 2014. In wheat we also have investments coming in that indicate... we could produce in the next two-to-three years about 50 percent of what we consume in the country," Kalibata added.

Rwanda currently produces 60 percent of the rice it consumes, importing the shortfall, while it imports about 60 percent of its wheat needs.

She said the country of about 11 million people did not have any food security fears, although the rising global cost of fuel and food prices could impact domestic inflation.

"Inflation is going up because some imported commodities are going up because fuel is influencing them," Kalibata said.

Rwanda's economic growth is forecast slowing to 7 percent in 2011 from 7.4 percent a year before, while inflation is projected to quicken to an average of 4.4 percent due to oil prices, the country's finance minister said in February.

Reuters

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