rural small and micro enterprise promotion project phase ii … · 2020-02-07 · rwanda: rural...

REPUBLIC OF RWANDA

Rural Small and Micro Enterprise Promotion Project – Phase II (PPPMER II) Follow-up Report

Type of report: Follow-up

Report No.: 2507-RW Date: 14 November 2011

INTERNATIONAL FUND FOR AGRICULTURAL DEVELOPMENT

FONDS INTERNATIONAL DE DÉVELOPPEMENT AGRICOLE

FONDO INTERNACIONAL DE DESARROLLO AGRÍCOLA

Via Paolo Di Dono 44•00142 Rome, Italy•Tel. + 39-6-54591•Fax + 39-6-5043463•E-mail [email protected]•Telex 620330

IFAD

FOLLOW-UP REPORT

of the

International Fund for Agricultural Development

and

United Nations Industrial Development Organization

Country: Republic of Rwanda

Project: Rural Small and Micro Enterprise Promotion Project –

Phase II (PPPMER II)

IFAD Loan: 613-RW

Date: 14 November 2011

IFAD Report No. 2507 - RW

RWANDA: Rural Small and Micro Enterprise Promotion Project (PPPMER-II)

Follow-up Report

Front Cover: The cooperative COOPAV-Mararo in Musanze runs this shop at the entrance of

the Vulcanoes National Park, at which tourists like buying the handmade baskets, handbags,

puppets and carvings. PPPMER assisted amongst others with training and coaching in

cooperative management, handicraft techniques and marketing. Vice-president Marie Rose said:

"With the help of PPPMER, the cooperative has brought enormous improvements to our lives.

Our incomes have multiplied since its creation in 2004." Photos : Markus Rosenberger

Back Cover: Florence Mukamana, president of CATM, a manioc cooperative in Gisagara

District, checks the cassava chips drying in the recently completed solar driers Photo : Claus Reiner


Follow-up Report

i

TABLE OF CONTENTS

Currency Equivalents, weights and measures, fiscal year ................................................................... ii

Abbreviations and acronyms .................................................................................................................. ii

Project map.............................................................................................................................................. iii

Aide Mémoire ........................................................................................................................................... 1

A. Introduction ................................................................................................................................ 1

B. Background Information ............................................................................................................. 1

C. Mission Findings and Agreements ............................................................................................. 1

D. Linkages ..................................................................................................................................... 9

E. Prospects and Follow-up .......................................................................................................... 10

Annexes

Annex 1: Agreed Actions, based on the Implementation of the Previous Agreed Actions ................. 11

Annex 2: Project Financial Status ........................................................................................................ 19

Annex 3: Project Status of Funds ........................................................................................................ 21

Annex 4: No-Objection Tracking Sheet .............................................................................................. 23

Annex 5: Compliance with Loan Covenants ....................................................................................... 26

Appendices

Appendix 1: Agriculture Value Chains ............................................................................................... 29

Appendix 2: Apprenticeship Support .................................................................................................. 39

Appendix 3: Rural SME Development ................................................................................................ 44

Appendix 4: Cooperative Development .............................................................................................. 56

Appendix 5: Handicraft and Tailoring Value Chains .......................................................................... 60

Appendix 6: Financial Services for Rural SMEs ................................................................................. 64

Appendix 7: Gender Inclusiveness ...................................................................................................... 68

Appendix 8: Monitoring and Evaluation ............................................................................................. 70

Appendix 9: Project Management ....................................................................................................... 72


Follow-up Report

ii

CURRENCY EQUIVALENTS, WEIGHTS AND MEASURES, FISCAL YEAR

1 USD = 600 RWF (November 2011)

Weights and measures: Metric system

Fiscal year: 1 July to 30 June

ABBREVIATIONS AND ACRONYMS

AWPB Annual Workplan and Budget

BDF BRD Development Fund

BDC Business Development Centre (RDB supported)

BDS Business Development Service Centre (PSF supported)

BIC Business Incubation Centre (RDB supported)

BPR Banque Populaire du Rwanda

CEAC Comité d‟évaluation et d‟analyse des crédits

CER Conseiller d‟entreprise rurale

CF Conseiller de filière

CIS Craft Industry Secretariat

COPORWA Communauté des potiers du Rwanda

DRF Demande de retrait de fonds

DU Demonstration Unit

FAC Fonds d‟appui à la commercialisation

FE Formateur d‟entreprise

FIDA Fonds international de développement agricole

FIT Fonds d‟appui à l'innovation technologique

MINICOM Ministry of Trade and Industry

MFI Microfinance institution

MOU Memorandum of Understanding

MSME Micro, small and medium enterprise

ONG Organisation non gouvernementale

ONUDI Organisation des Nations Unies pour le développement industriel

PCU Project Coordination Unit

PMER Petite et micro-entreprise rurales

PPPMER Projet pour la promotion des petites et micro-entreprises rurales

PSF Private Sector Federation

PTBA Programme de travail et budget annuels

PROBA Proximity Business Advisor

RCA Rwanda Cooperative Agency

RDB Rwanda Development Board

RSE Responsable du suivi-évaluation

RWF Rwandan Franc

SACCO Savings and Credit Cooperative

SDR Special Drawing Rights

SPIU Single Project Implementation Unit

TOR Terms of Reference

TVET Technical and Vocational Education and Training

UNIDO United Nations Industrial Development Organization

USD United States Dollar

WDA Workforce Development Authority


Follow-up Report

iii

PROJECT MAP

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BURERA

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RUHANGO

NYABIHU

MUSANZE

NGOROREROGASABO

RWAMAGANA

RUBAVU

KICUKIRONYARUGENGE

EASTERN PROVINCE

WESTERN PROVINCE

SOUTHERN PROVINCE

NORTHERN PROVINCE

TOWN OF KIGALI

MWIRI

RWIMBOGO

MURUNDI

KARANGAZI

MPANGA

RWERU

NDEGO

KIVU

RWIMIYAGA

CYATO

BUTARE

BWEYEYE

BONEZA

MUSASA

GAHINI

KITABI

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KABARE

KINIGI

RUHERU

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GAHARA

KAZO

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MAYANGE

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KIGEYO

RILIMA

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BURUHUKIRO

GITESI

JARAMA

MUKURA

KABARORE

MUYIRA

MATA

KINAZI

MUSHELI

MUGINA

GITOKI

MBUYE

MAMBA

KIBIRIZI

TWUMBA

MUSAZA

KIVUMU

KIGARAMA

MUHANDA

SAKE

MUBUGA

RONGI

TABAGWE

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MUGESERA

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NYANGE

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MATIMBA

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BUSORO

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MURAMA

MUKINGO

MUZO

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MAHAMA

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GASHARI

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MUKAMA

NDERA

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RUKUMBERI

KANSI

MUGANZA

BUTARO

RUNDA

RUGABANO

RUVUNE

KINIHIRA

NYARUBUYE

MINAZI

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MUSHA

BYIMANA

MUTETE

NTYAZO

MBAZI

KIBIRIZI

MURUNDI

KIREHE

NDUBA

NYAGISOZI

KAVUMU

MAREBA

KAGEYO

NYAMIYAGA

RUGARAMA

RUTARE

NZIGE

RURENGE

RUKOMO

RUBONA

KARENGE

NYANGE

MUGESERA

MUTENDERI

NYANGE

KARAMA

KARAMA

KIGOMA

HUYE

MURAMBI

KIZIGURO

BUYOGA

MWOGO

RUBENGERA

MUSHA

MUHAZI

NZAHAHA

KABAYA

SHANGI

NGOMA

REMERA

KARAMA

RUGANDA

MUSEBEYA

CYANIKA

KAGEYO

MARABA

KABAGALI

MUHANGA

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BUSANZE

RWANKUBA

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MURUNDA

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BUSHOKI

RURAMIRA

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MANIHIRA

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DISTRICTS ET SECTEURS D'INTERVENTION DU PROJET PPPMER-II

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Follow-up Report

1

Republic of Rwanda

Rural Small and Micro Enterprise Promotion Project (PPPMER)

IFAD Loan 613-RW

9th Mission: Implementation Support

AIDE MÉMOIRE

A. INTRODUCTION

1. A joint implementation support mission1 of IFAD and the United Nations Industrial

Development Organization (UNIDO) visited Rwanda from 17 to 28 October 2011 with the purpose of

reviewing the implementation progress of project activities and making practical recommendations in its

support.

2. The team met senior representatives of MINICOM, Rwanda Development Board (RDB),

Rwanda Workforce Development Authority (WDA), Rwanda Cooperative Agency (RCA), BRD

Development Fund (BDF), Private Sector Federation (PSF), Banque Populaire du Rwanda (BPR),

Duterimbere IMF and Access to Finance Rwanda. The mission held working sessions with the Single

Project Implementation Unit (SPIU) and visited stakeholders in the districts of Burera, Gakenke,

Gisagara, Huye, Musanze, Nyabihu, Rubavu, Rulindo and Rwamagana. The team members express

their sincere appreciation to MINICOM and district staff for their enthusiastic support to the mission.

3. This Aide Mémoire was discussed and agreed at a wrap-up meeting chaired by the Permanent

Secretary on 28 October, attended by representatives of the SPIU and its key partners. Its content is

subject to confirmation by way of an IFAD Management Letter.

B. BACKGROUND INFORMATION

4. PPPMER-II is a 9-year investment project implemented by MINICOM aiming at reducing rural

poverty through the development of rural off-farm small and micro enterprises. It started in June 2004

and will be completed in June 2013, after a 2-years extension period decided in January 2011. The

total cost of the project is estimated at USD 18.17 million. The IFAD loan commitment amounts to

USD 14.90 million.

C. MISSION FINDINGS AND AGREEMENTS

5. General. The mission was pleased to note that the Single Project Implementation Unit (SPIU)

is in place with an enthusiastic and experienced team. Notwithstanding this, the period leading up to its

creation was a difficult time for the PCU staff, which led to a slowdown in the rate of implementation

and the project pro-activeness. With this, the service provision to rural microenterprises has also been

reduced to a few directed activities, which are useful but tiny, and the chance of building functioning

sustainable services has so far not been addressed. It will be important to utilise well this chance,

building on strategic decisions that take into account project experiences and capacities.

6. As a basis for such decisions, the Ministry has reconfirmed the validity of both the SME Policy,

which directs government at channeling its support through permanent public entities in conjunction

with project mechanisms, and the objectives of the project as a vehicle to improve the performance of

1 The mission comprised Claus Reiner, IFAD Country Programme Manager, Team Leader, Damien Ngendahayo,

Agriculture Value Chains and Apprenticeship Expert; Gaspard Kabalisa, Business Plans Expert; Markus Rosenberger,

Cooperative Development and Handicrafts Expert; James Kagaba, UNIDO Agro SME Expert; Elizabeth Ssendiwala,

Gender Expert; Sonia Ntukanyagwe, Rural Finance and M&E Expert; and Christian Hakiba, Financial Management

Expert.


Follow-up Report

2

the rural microenterprise sector in the country. In this context, it was noted that PPPMER is

MINICOM‟s main vehicle for reaching this target group, and as such it was indeed necessary to widen

the targeting to all rural sectors in the country and all types of rural microenterprises. This also means

widening the project‟s focus from a number of identified beneficiary SMEs to a broad target group,

which was intended at design.

Component 1: Strengthening Partner Capacities

7. Cooperatives. Including through RCA, the project has supported some 850 cooperatives with

coaching and training services, with 171 ones (comprising some 3 700 members) intensively

accompanied in preparing cooperative development plans. Furthermore, 9 unions and 5 federations of

cooperatives operating in the priority value chains have been created with project support. Women are

relatively well represented in the decision-making positions of the cooperatives. The mission noted a

varying level of performance of the cooperatives and their unions. Especially business skills and the

problem solving capacity have to be developed further to reach operational and economic sustainability

of these groups. It was thus agreed to focus in the future on strengthening pro-activeness and on the

development of marketing skills adapted to their specific context. Since these important support services

take time to reach sustainability, activities should be limited to cooperatives, unions and federations

created before 2012.

8. The simplified and summarized guidelines for cooperative management and governance have

been distributed to cooperative unions and federations. However, these documents are principally

required by the cooperatives themselves, in Kinyarwanda. RCA agreed to distributing the guidelines

further, to establish a list of recipients, and to using them in its coaching programme.

9. The Conseillers d’entreprise rurale (CER) are currently working with RCA, coaching and

training some 150 cooperatives participating in the Crop Intensification Programme (CIP). The mission

is pleased to see that the services delivered by the CER are highly appreciated by these cooperatives.

However, this intensive support was planned to be temporary, the agricultural focus of most of these

cooperatives as well as their advanced status suggest that the targeting is not fully in line with the

PPPMER objectives of supporting rural microenterprises. In addition, MINICOM favours adopting a

model of service provision driven by the demand of all SMEs regardless of their organizational form.

For this, the CER will be released by RCA immediately after signature of the district MOUs, at the latest

by 1 January 2012.

10. RCA also agreed to addressing the reporting shortcomings, in both format and timeliness.

Quarterly and final reports for the period ended in June 2011 have not been submitted as agreed, and

delays led to incompleteness of the project‟s annual report. The final report is a precondition for the

continuation of the collaboration and has to be submitted by November. The reporting format also needs

improvement with a cumulative comparison of expected and achieved results. The MOU for the next

period has to be finalized by November 2011.

11. Business Development Centers (BDCs). The mission acknowledges government‟s decision

and steps to privatise the BDCs, and observes that BDCs are unlikely to reach rural small and micro

enterprises (RSMEs) (which are the targeted PPPMER clients) given thee distances and their limited

capacity to afford their services. Moreover, no voucher system is envisaged by RDB. Nonetheless, RDB

is planning to develop its strategic plan for the BDCs soon, for which it does not require the previously

envisaged project support from UNIDO.

12. Business Incubation Center (BIC). The BIC at Masaka has started training in its leather unit.

Meanwhile, the fruit, dairy and bamboo units are awaiting installation, expected for end-2011. Under the

expired project MOU with RDB to finance fruit processing equipment, the BIC was to train 100 persons

in fruit processing. To conclude the activity, it was agreed to extend the duration of the MOU until end-

2012, and that RDB hire a fruit processing trainer to be coached by the available technical assistance.

Moreover, it was noted that no business strategy for the Centre was in place, and that plans for weaning


Follow-up Report

3

entrepreneurs from its services were notional. Such business strategy should include training plans for

experienced and new entrepreneurs, clear rules for the use of the facilities during and after the training

with a cost escalation, a chart of costs for use of the sub-sections of each unit, pricing of tools and

materials, a communication strategy and an M&E system. This being an urgent need for technical

assistance to RDB for the elaboration of the business strategy to ensure the operationality of the BIC, it

was agreed that this activity will be supported by UNIDO in the framework of the One UN funded

project on Livestock Resource Value Chain Development.

13. Rural Microenterprise Development. Both the mission and MINICOM senior management

confirmed the need for business development services by a very large number of rural microenterprises,

which together with agriculture constitute the basis of the currently weak rural economy. In response to

this unfulfilled need and consistent with the SME Policy, it was observed that while no central level

agency is oriented towards filling this gap, the districts and sectors are well placed and mandated to

facilitate such services. Furthermore, recognising the capacity constraints in local government and

MINICOM‟s intentions of building demand-driven services, service provision by small-scale businesses

in rural areas initially supported through a voucher system presents itself as the system of choice.

14. It was thus agreed to initiate the Proximity Business Advisory (PROBA) Scheme in partnership

between the SPIU and the districts. To coordinate it, each district will contract the services of an RSME

Facilitator (the former CER) with performance incentives, who will organize the identification and

accreditation of the PROBAs (including the former FE) and the voucher distribution. With the vouchers,

RSMEs will be able to contract the services of nearby PROBAs on a 1-to-1 basis. Subsidies for the

vouchers will be slowly reduced. All payments will be done through SACCOs on a commission basis. A

District PROBAS Committee will oversee the implementation of the scheme and report to the SPIU. An

MOU will be signed between the SPIU and each district, to which an annex MOU will be added

between the district and the Sector SACCOs. A schematic diagram of the scheme is shown below.

15. An important feature of the PROBA Scheme will be its demand-driven nature, allowing each

participating RSME (both individual enterprise and cooperative) to choose its service provider from a

SPIU

RSME

Facilitator

Rural and Micro

Enterprises

BDC, BDS,

Proximity Business

Advisors

Serv

ices

Vo

uch

ers

District Contract

Propose voucher recipients

District PROBAS

Committee

Sector

SACCO


Follow-up Report

4

PROBA list regularly updated by the RSME Facilitator. Initially, the vouchers would cost RWF 500 and

have a face value of RWF 5 000, buying about 4 to 8 hours of service. For control and M&E purposes,

each PROBA will fill in the service details on the vouchers cashed in (see also paragraph 40.).

16. The system would be set up immediately, with an effective start date of 1 January 2012, with

intensive sensitisation campaigns launched before that date. To ensure gender responsiveness in the

system, the campaign messages should be packaged in a way that gives rural poor women and men

confidence to seek for the business advisory services. Initially, the 211 former FEs will be accredited,

immediately followed by the mobilisation of more PROBAs, aiming at 2-3 PROBAs per sector. All

PROBAs will require training to provide quality services, mainly in business management and

coaching. For this, the project will build on the PCU‟s request to the International Labour Organization

(ILO) to utilize its SIYB (Start and Improve Your Business) modules to enhance technical skills of the

PROBAs. This activity will be supported by UNIDO in the framework of the One UN funded project on

Livestock Resource Value Chain Development.

Component 2: Operational Support to Rural SMEs

17. Apprenticeship training. Despite previous agreements, the rural apprenticeship training

programme, still implemented directly by the project, has not yet been integrated in a partner agency.

Nonetheless, implementation is on track. So far, 8 546 youth (56% of women) have completed their

6 to 12-month training by rural micro-enterprises in 31 different trades. In addition, 1 500

apprenticeships (63% of women) are ongoing and the project is identifying 2 000 apprentices to start

in November 2011. Apprenticeship training manuals related to 7 main trades were prepared by

KTC/WDA and distributed to 445 participating training enterprises. During the mission, the

Workforce Development Authority (WDA) expressed its strong interest in working in partnership

with the SPIU to implement the programme. The mission found out that all activities related to

apprenticeships were not yet transferred to WDA. To develop the partnership between the SPIU and

WDA, the following actions were agreed upon:

a) The SPIU to share key project documents (extension design, follow-up and implementation

support reports, apprenticeships strategy, etc.) by 30 October 2011;

b) The SPIU to prepare a concept note on modalities of collaboration with WDA, to be discussed

and finalized by 15 November;

c) WDA to prepare an outline of the apprenticeship programme document (including the planned

accreditation of participating training enterprises and the certification of apprentices,

differentiation between new and experienced apprentices, follow-up by PROBAs to be contracted

directly by WDA, possibly selected and supervised by its vocational training centres - VTCs) by

15 December; and

d) The SPIU to prepare an MOU with WDA based on the above document, to be signed by

15 January with a view to take over the implementation from the SPIU immediately thereafter.

18. Key constraints currently experienced by the apprenticeship programme include training

follow-up, which is not satisfactory at the moment since CERs are overloaded by work in their new

mandate and FEs are no more on board. This will affect the quality of ongoing training if corrective

measures are not taken. In addition, most post-apprenticeship training activities for apprentices

graduated in February and March 2011 are not yet done. To address these shortcomings, it was agreed

with the SPIU and WDA that WDA will: (i) contract PROBAs for apprenticeship follow-up using the

voucher system; and (ii) provide graduate apprentices with vouchers for post-apprenticeship training.

19. The mission was pleased that there are more women apprentices than men. However, men

and women are concentrated in different trades according to the „traditional lines‟, with women trades

generally less lucrative than men‟s. It is recommended that the sensitization campaigns should include

messages that encourage women to join the traditional male trades (such as leather).


Follow-up Report

5

20. Handicraft and Tailoring Value Chains. The mission notes a varying performance in the

training of artisans, with annual training achievements ranging from 60% to overachievement. This is

left uncommented in the annual report. In view of the migration of the Crafts Industry Secretariat

(CIS) to the SPIU and in line with the SME Policy, further activities as of 1 March 2012 are to be

carried out by partner institutions such as PSF (for marketing support), WDA (for innovation and

technical training) and consultants (for example, for marketing support and workshops with clearly

specified targets). They should be more demand-driven and tied to the elaboration of realistic

marketing plans. The SPIU needs to assist and consult the service providers on a day-to-day basis.

21. The mission notes that marketing support is largely limited to beneficiaries‟ trade fair

participation, which is of limited effectiveness and very costly. It was agreed that the SPIU put more

emphasis on demand-driven and context-adapted coaching and training in small-scale marketing,

focussing on strengthening self-reliance and pro-activeness among the RSMEs. Local service

providers, such as the PROBAs, should be trained by creative business persons for this purpose.

22. The MOUs concerning the ownership and use rights of the 13 artisan houses and kiosks have

still not been signed by the district authorities, and the handover ceremonies are yet to be organized. It

was agreed that the conclusion of these MOUs be a priority activity, to be finalized by end-2011.

23. Based on good implementation performance and high target group relevance, it was agreed

that the partnership with the Community of the Potters of Rwanda (COPORWA) be re-initiated with a

new MOU, focusing on better technologies as well as training and study tours to upgrade ceramics

production techniques and marketing.

24. In view of the increasingly scarce project resources, it was agreed that the value chain

activities require more rigorous planning, with strategic objectives and a priority afforded to activities

with low costs per client. The plan should include a calendar with quantified objectives, the roles and

responsibilities of the SPIU and its partners.

25. Demonstration units (DUs). DUs foreseen to be supported by the project include 5 cassava

units, 4 honey units and 1 passion fruit unit. Despite previous mission recommendations, all 10 units

but one are still not operational. Equipment was supplied to cassava DUs by 30 May 2011, but are not

yet tested. The mission found some of them, particularly the chippers, in miserable condition, with

urgent need for replacement by the manufacturer. The cassava mills have not yet proven their

functionality, and need immediate elaborate testing at all 5 locations. In addition, it was noted that

some materials were oversupplied and should be put to proper use. External constraints that further

delayed start-up activities include: i) 2 DUs have no water; ii) the roof structure of a third unit has

been taken away by a storm. It was agreed to start production, training and demonstration activities in

the remaining two DUs, while waiting for remaining works in the 3 dysfunctional DUs to be

completed with the support of MINICOM and the districts. Training manuals are being finalized by

the cassava and fruits value chain adviser. Most of the required equipment for honey and passion fruit

DUs are expected to be supplied in November 2011. To guarantee the quality of the passion fruit

equipment, it was agreed that UNIDO be involved in their inspection during the elaborate testing.

26. Even though cooperatives operating DUs were rated among the best performing at the DU

conceptualisation stage, the mission noted that key staff were insufficiently trained and still need

refresher training. Most cooperatives had prepared 3-year business plans, but never updated them to

the current market conditions. MOUs were signed with only 3 cassava cooperatives. It was agreed to:

(i) prepare and sign MOUs for the 7 remaining cooperatives; (ii) assist all 10 cooperatives in

updating their business plans and finalize training and demonstration work plans; and (iii) require

the cooperatives to prepare monthly DU performance reports.

27. Technical and marketing support (FIT/FAC). Improvements are notable in the use of FIT

and FAC, which funds provide capital to RSMEs for technological innovation and marketing. To date,

42 projects have been approved and an additional 18 are being evaluated, mostly in the agro-


Follow-up Report

6

processing and tailoring value chains. The increase in the funds utilization is a result of the previous

mission‟s recommendation to allow beneficiaries to procure equipment directly and due to FIT and

FAC advertising campaigns. However, only 17 projects have yet been fully financed, partly due to

long administrative processes, and partly due to difficulties of some recipients to raise their

contribution. The mission recommends that the SPIU link these to the RSME credit services of BPR

and Duterimbere. The average project cost is RWF 5.5 million. The project contribution to the

42 approved projects ranges from RWF 700 000 to RWF 6.8 million, totaling RWF 150 million, equal

to one third of the funds. No more applications were accepted after March 2011, as agreed with the

previous mission. The mission notes that while the FAC finances primarily trade fair participation

with questionable impact, the FIT finances both investments and training activities that often respond

to a real need. To reduce further the bureaucratic delays in approval and execution of the proposals,

and in an effort to raise the cost effectiveness of the support, it was agreed that the project will

respond more flexibly and directly to requests for training that are beyond the scope of the PROBAs,

channeled through the RSME Facilitators. Where possible, local training institutions such as BIC and

VTCs would be used for this. An in-kind beneficiary contribution (about 25%) will be required, to be

negotiated on a case-by-case basis. After end-June 2012, no more FIT and FAC proposals will be

approved.

Component 3: Financial Services for Rural SME

28. Credit lines. The BRD Development Fund (BDF), mandated by the SME Policy to manage

funds aimed at providing finance to SMEs, has begun operations and will continue the wholesale

management of the project credit lines to BPR and the participating MFIs. The PCU has not advanced

in this regard. It was now agreed that the SPIU prepare a wholesale credit transfer agreement by end-

November, specifying that BDF will carry the lending risk, and detailing management and reporting

obligations, and cost recovery and incentives for BDF services. The agreement will be signed between

MINICOM and BDF, and the SPIU will assist in its implementation.

29. In addition, in an effort to reduce the retail lending risk, it was agreed that BDF will expand

its range of credit guarantees to also cover SME loan portfolios. For this, it will develop a concept

note by end-December 2011 describing the terms and conditions of the product, the review

procedures, and the eligibility criteria. To cater effectively for the SME sector, it is critical that simple

wholesale approval mechanism can be found, and that working capital loans be explicitly included in

the guarantee cover.

30. It was agreed that the SPIU prepare for BDF a note on lessons learnt on its wholesale credit

lines. It is also important that the SPIU‟s Sector Specialist, Access to Rural Finance, develop a closer

working relationship with BDF, directly supporting the planning processes and thereafter following

up on the agreed arrangements.

31. The BPR credit line has financed 1 890 projects for a total amount of RWF 969.2 million. Its

current outstanding balance is RWF 213.1 million, with an alarming overall arrears rate of 36% that

partly reflects high risk, and partly that few loans have been disbursed for about a year. Despite the

low usage, BPR is interested in a re-launch of the credit line for this particular target group by

developing improvements, including a consistent collaboration with Credit Analysis and Evaluation

Committees (CEACs) and also with the Access to Finance Forum. The CEAC is a sector-based group

that pre-screens loan applications before the bank‟s review, and also helps to sensitize RSMEs about

financial services and helps with recovery and follow-up. Despite these useful services, so far most

CEACs have never received the premiums stipulated in the BPR‟s credit agreement with the PCU. It

was agreed that regular payments to the CEAC begin immediately, and that the project support one

member per CEAC with an indemnity of RWF 10 000 per month for coordination functions. The

Access to Finance Forum is a new district-based mechanism to address financial service issues,

including recovery support. BPR has agreed to provide lists of defaulters to the forum to facilitate

recovery. The mission confirmed that loans will be made available nationwide and to all rural

microenterprises found bankable by the participating financial institutions.


Follow-up Report

7

32. The mission noted many reporting issues including reporting delays by BPR headquarters,

poor format adherence by many BPR branches and sub-branches and lack of feedback to the reports.

It was agreed that BPR improve its reporting and fill its data gaps, with assistance by the SPIU. In

addition, an assessment of BPR‟s statements on the credit line is planned to establish the current

situation by end-November before transferring the credit line management to BDF.

33. The project also works with Duterimbere MFI through a RWF 30 million credit line that has

funded 30 RSMEs for a total of RWF 11.4 million, with an arrears rate of 2%. Problems remain in the

accessibility of funds and in reporting (similar to BPR). The SPIU will also assist Duterimbere MFI in

improving its working relationship with the CEACs, and the MFI will share information on defaulters

with the Access to Finance Forum.

34. The two other MFI credit lines need to be discontinued with urgency. CT Byumba recently

closed down and as a result the recovery process must be initiated immediately. It was noted that the

agreed recovery of the funds from UCAPEC has not begun, and that notice needs to be given

immediately to the SACCO to repay the credit funds borrowed by UCAPEC.

35. Financial capacity building. Through RCA, the project supports some Sector SACCOs by

building their capacity to provide financial services to RSMEs. Thus far, three manuals and seven

modules have been developed and management training is ongoing including savings mobilization

and management, audit and finance management. It was agreed that a capacity building workplan for

SACCOs be developed immediately by RCA to guide its support to priority areas.

Component 4: Project Coordination

36. Project management. The establishment of the SPIU is well advanced for PPPMER. Still

outstanding are the hand-over by the PCU, the audit, the consolidation of procedures and the induction

training of staff. It was agreed that the SPIU maintain the PPPMER special and operations accounts (to

be called sub-accounts), while a combined counterpart fund account will be established for all SPIU

projects. A number of project management tools, already used by the PCU to a large extent, was shared

by the mission with the SPIU, which intends applying these to the management of its overall portfolio.

Moreover, the preparation of the SPIU administration and finance procedures manual will draw from the

new Project Implementation Manual (PIM) being developed for IFAD projects within the SPIU in

MINAGRI. It was agreed that it be submitted to IFAD for no-objection for compliance with section

6.01(c) of the loan agreement.

37. The mission noted that the SPIU has not instituted a mechanism or responsibility to address

issues of gender equality and women‟s empowerment. In an effort to address this, it was agreed that a

gender focal point be appointed to ‘champion’ gender issues, while it is every staff’s responsibility to

contribute to gender equality in their functions.

38. Financial management capacity. While the project‟s financial management function is still

executed by the PCU, as of 1 November 2011 the SPIU Finance Management Services will take over.

It is made up of a finance management specialist, a chief accountant and an accountant. The

recruitment of two additional accountants is underway. It was agreed that the change of signatories to

the project accounts and their signature specimen be communicated to the IFAD Nairobi office at the

earliest, and that the SPIU finance unit fully utilize the experience of the former finance unit for

training and familiarisation with IFAD loan administration procedures.

39. Planning. The project MOUs with partner institutions require finalization to take into account

the agreed modifications to the current AWPB. Moreover, the SPIU has started consolidating all

project AWPBs into a single AWPB, for the format of which improvements were suggested by the

mission. It was agreed that the SPIU submit the consolidated 2011/12 AWPB to IFAD for no-

objection to the activities pertaining to PPPMER only, and subsequently the modified MOUs.


Follow-up Report

8

40. Monitoring and Evaluation. The SPIU is still in its initial stages of setting up an M&E

system. Its M&E Specialist is currently building on existing M&E frameworks of the different

projects to create a single M&E system with planning and reporting templates for all projects. While

there has been no progress in updating the RSME database and filling its data gaps, its use remained

limited. To satisfy its information needs on business development services, the SPIU will establish a

more comprehensive database on RSME service provision countrywide, fed with gender disaggregated

information from the vouchers of the PROBA Scheme, to be provided regularly by the districts. It is

important that this system, including the data to be collected on the vouchers and the districts‟ role,

include the key data collected by the PCU and that it be agreed before the PROBA Scheme begins.

41. Reporting on gender was observed to be haphazard, depending on individual initiative rather

than an institutional requirement. Where there is gender reporting, it normally stops at sex

disaggregated statistics which are not backed by an analysis of the reasons behind the numbers. As

such, opportunities for learning on gender equality are often missed. It was agreed that reporting on

gender will become a routine requirement. Qualitative analysis should be used to explain gender

differences observed in the quantitative data.

42. Reporting. The PCU periodically reports on its activities through progress reports. The

mission reiterates the previous recommendation that these reports be improved qualitatively by

highlighting key issues and lessons learned, and proposing solutions for the future.

43. Procurement. The mission reviewed the implementation status of the 2010/11 procurement

plan and noted considerable delays, such as in the acquisition of equipment for the demonstration

units for fruit processing and beekeeping. More importantly, one performance guarantee had expired

and was promptly renewed during the mission. It was agreed that the PCU regularly monitor such

critical contractual elements for delayed procurement, and ensure that liquidated damages are

enforced in case of late delivery.

44. In response to an audit enquiry, IFAD confirms that all assets procured with project funds are

owned by the government, and that it would be reasonable for the implementing ministry to continue

managing them after project completion.

45. Contract management. The contract register is not updated regularly, with some MOUs

included during the period of the mission and columns related to the no-objection and the Contract

Management Forms (CMFs) not filled in regularly. Payment progress monitoring would be better

done on the CMFs themselves. More importantly, the mission was not provided with the contract

collection to ascertain its completeness, which raises serious concerns regarding the contract

management function. In addition, it was noted that the project keeps a different CMF format that

does not track invoices and performance guarantees. It was agreed that to improve its contract

management function, the SPIU start using the current CMF format and regularly keep an updated

electronic archive of all its contracts and MOUs.

46. Disbursements and liquidity. While the 2010/11 AWPB was executed at 75%, current

disbursements are low. As of 30 September 2011, the project has disbursed 77% or RWF 8.90 million

of the total planned project financing of RWF 11.50 million. Against its 2011/12 AWPB amounting to

RWF 1.97 million, disbursements stand at 12.2% (7% for component 1, 13% for component 2, 5% for

component 3, and 38% for component 4). Notwithstanding, the remaining loan funds as at

30 September 2011 are estimated at USD 1.915 million, considering the pending withdrawal

application (WA) 84, the upcoming WA 85 and the balance of the project accounts. Tight

disbursement planning and monitoring will be required in the remaining project period.

47. The mission carried out a random review of items from recent statements of expenditure

(SOE). Overall, the mission found that all items had full supporting documents and were eligible for

financing by IFAD. As the available balance of funds has reached the threshold, it was agreed that,


Follow-up Report

9

for future WAs, recovery of the Authorised Allocation will be done at 50% to allow for a timely

recovery of the initial deposit.

48. Counterpart funds. The receipt of counterpart funds for 2010/11 was satisfactory, standing

at RWF 270 million or 90.0% of the AWPB. However, cumulatively, the government contribution

only stands at RWF 686 million or 51.7% of the commitment in the Loan Agreement. The mission

was informed that the government allocation for the fiscal year 2011/12 has been set to only

RWF 90 million, against a budgeted amount of RWF 325 million. The planned RWF 90 million

would bring the cumulative government contribution to only 59%. Considering a potential budget

revision in December 2011, it was agreed that MINICOM advocate for an increase in government’s

budget allocation to PPPMER in order to allow for a timely execution of the 2011/12 AWPB and to

deliver against government’s commitment in the Loan Agreement.

49. Audit. The mission is pleased to note that the 2010/11 audit mission was undertaken in

October 2011 as planned and that the PCU has executed the 2009/10 audit recommendations at a rate

of 88% as confirmed by the Auditor General. However, it is noted that the PCU has not implemented

recommendations related to compliance to the cut-off principle of accounting, the management of the

BPR credit line and the reconciliation of its reports. It was agreed that the SPIU urgently implement

the pending 2009/10 audit recommendations.

D. LINKAGES

50. The mission is pleased to note the high degree of complementarity between PPPMER and the

newly designed MSME Development Project. Apart from being implemented by the same Programme

of the SPIU, the two projects share the focus on a wide spectrum of small and microenterprises, and the

market-based demand-driven approach. There are a number of direct complementarities between the

two projects, and also some fundamental differences that distinguish PPPMER from the MSME

Development Project in its current design. These have implications on the possible linkages between the

two in implementation.

51. Firstly, in component 1 the MSME Development Project proposes the continuation of the

apprenticeship programme, albeit provided through the VTCs. This is in fact not a continuation but a

parallel programme, which complements well the enterprise-based apprenticeships offered by PPPMER.

Enterprise-based apprenticeships offer many training vacancies at a very low cost, with a mix of skills

ranging from technical to managerial, reinforced by practical difficulties that emerge in daily

entrepreneurial life. Once these basic skills are acquired, more formal and specialised training through

the VTC system can be an ideal complement to allow graduation to the successful microenterprises. As

such, it is recommended to operate the two systems in parallel, and to build continued learning bridges

between the two.

52. Secondly, in component 2 the MSME Development Project will provide targeted grants to

businesses in priority value chains, while other value chains would benefit from a voucher system,

which is not yet conceptualised. With the design of the PROBA Scheme, PPPMER will lead the way for

a unified voucher scheme to reach small and microenterprise throughout the country, which can and

should eventually be used by both projects jointly. However, the MSME Development Project plans to

focus the voucher support on small enterprises, while PPPMER will target microenterprises with the

same scheme. This difference is likely to disappear as neither PSF nor RDB are attracted towards a

voucher scheme, and the services for their larger-scale target group may already find a ready market at

their respective district-based centres. As such, both PPPMER and the MSME Development Project

may find themselves working with a similar target group. Nevertheless, different voucher values are a

possibility within the same system to cater for different types and costs of services.


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10

E. PROSPECTS AND FOLLOW-UP

53. The mission reiterated IFAD‟s position that there is scope for IFAD to consider further support to

the rural microenterprise sector in Rwanda – provided the availability of funds – once the two conditions

previously communicated are met: (i) that PPPMER effectively implement a comprehensive range of

support activities for rural microenterprises in line with the SME Policy; and (ii) that the capacities

established by PPPMER be used by and integrated in the structures thus created.

54. The next joint mission for the project is planned for May 2012 in the form of a follow-up mission.

An assessment of the conditions above being met may be undertaken as early as during this mission.

Claus Reiner Emmanuel Hategeka

Country Programme Manager, IFAD Permanent Secretary, MINICOM

Kigali, 28 October 2011


Follow-up Report

11

ANNEX 1:AGREED ACTIONS, BASED ON THE IMPLEMENTATION OF THE

PREVIOUS AGREED ACTIONS

Agreed Action (May 2011)

with Responsibility and Deadline

Status Update by PCU,

15 October 2011

Agreed Action (October 2011)

with Responsibility & Deadline 1. Strengthening Partner Capacities

Cooperative support

4 Distribuer au moins 2 copies du guide

simplifié de gestion des coopératives par

coopérative encadré. (Antennes, 30 juin 2011)

Les copies des guides simplifiés de gestion

des coopératives ont été distribuées au

niveau des unions et fédérations de

coopératives, ainsi qu‟aux encadreurs et

formateurs des coopératives au niveau des

Districts.

4. Distribute the cooperative guidelines

to each cooperative, establish a list of

recipients so that they can be used in

RCA coaching programme (RCA, 31

Dec. 2011).

71 Les rapports d‟activités doivent être

conformes au canevas fourni et contenir des

résultats chiffrés et des appréciations

qualitatives sur l‟avancement des activités.

(CIS, continu)

La recommandation a été respectée. Les

rapports présentent des données chiffrées, et

conformément au canevas convenu.

OK

106A. Submit 2010/11 annual report

including cumulative comparison of

expected and achieved results (RCA,

30 Nov 2011).

106B. Finalize new MOU between

RCA and SPIU (RCA & SPIU, 30

Nov 2011).

Business Development Centres

81B La base de données du Projet déjà

ventilée par District doit être transféré à RDB

d‟abord et aux BDS ensuite. (UCP, 30 juin

2011).

81C La formation des FE par le staff des

BDS, avec l‟appui du Projet doit être

complètement achevée. (UCP, 30 juin 2011)

81D Toutes les activités prévues par les 2

précédents MOU avec RDB doivent être

réalisées entièrement. (RDB / UCP, 30 juin

2011).

81 E En relation avec l‟extension du Projet

PPPMER, un nouveau MOU doit être signé

avec RDB dans l‟esprit de la réorientation du

Projet. (RDB / UCP, 30 juin 2011).

81 F Un plan d‟action et un budget détaillé de

la participation de l‟ONUDI dans les activités

La base de données ventilée par District

avait été déjà transférée aux CER affectés à

RDB pour être intégrés dans les BDS.

Quand RDB a officiellement décliné

l‟utilisation des services des CER, ces

derniers ont été transférés dans l‟Agence

Rwandaise des Coopératives. La Base de

données reste toujours à leur disposition, et

sera partagée avec les BDS Centres dès que

ces centres seront opérationnels.

Le staff des BDS n‟étant pas encore en

place, cette formation n‟a pas encore eu

lieu, mais les concertations ont été déjà

engagées avec ILO pour organiser la

formation des CER au 2ème

trimestre

2011_2012.

Toutes les dispositions avaient été prises

pour réaliser les activités prévues. Les BDS

avaient été mis en place, l‟intégration des

CER dans les BDS et les formations du staff

des BDS en cours. Suite aux changements

intervenus dans l‟orientation des BDS

comme des structures totalement privées,

Les CER ont été intégré dans l‟agence

Rwandaise des Coopératives en vue de

faciliter leur tâche d‟encadrement des

coopératives de pmer et des autres pmer en

général.

Le plan d‟action du Projet pour l‟année

2011_2012 fait ressortir la participation et le

OK, no longer applicable


Follow-up Report

12




15 October 2011


with Responsibility & Deadline du Projet doit être élaboré, discuté et intégré

dans le plan global du Projet. (RDB / UCP, 15

juin 2011)

budget global de l‟ONUDI, particulièrement

au niveau de l‟assistance technique des

BDS, mais le budget détaillé sera spécifié

après le recrutement des gestionnaires

privés des BDS.

Business Incubation Centres

107. Extend the duration of the MOU

with RDB until end-2012 to complete

planned activities. (SPIU, 15

December 2011)

108. Support the elaboration of the

business strategy for the BIC at

Masaka to ensure its operationality.

(UNIDO, 31 January 2012). Rural SME Advisory System

82B En collaboration avec RDB, le Projet, à

travers ses antennes, doit organiser sans tarder

la séance de reconnaissance des FE.

(UCP/RDB, 30 juin 2011).

82D La base de données des personnes

ressources & services aux pmer rurales (CER,

FE, IMF, autres prestataires) déjà disponible,

doit être transféré à RDB d‟abord et aux BDS

ensuite. (UCP / RDB, 30 juin 2011).

Les séances de reconnaissance des FE

devaient être conjointement organisées en

collaboration avec RDB, mais au moment

prévu pour l‟organisation de ces séances,

RDB a décliné son offre d‟intégrer les CER

dans les BDS, et nous avons opté pour la

solution du processus de renforcement des

capacités des FE en collaboration avec ILO,

en vue de renforcer leur capacité de

partenariat avec les gestionnaires privés des

BDS sitôt mis en place.

Cette base de données est déjà partagée avec

les gestionnaires de cette base au niveau

District et sera mis à la disposition des BDS

sitôt qu‟ils seront opérationnels.


97 Intégrer le programme dans le SME

Development Project action plan. (MINICOM,

31 mai 2011)

Le projet a été intégré dans le SME

Development Project action plan et le

coordonnateur du MSME Development

Project est en même temps coordonnateur

du PPPMER II.

OK

109. Initiate the Proximity Business

Advisory (PROBA) Scheme in

partnership with the districts.

(SPIU, 1 Jan 2012).

2. Operational Support to Rural SMEs

Apprenticeship Training

10 D Distribuer les manuels d‟apprentissage

avant fin juin et établir les listes emmargées

des récipiendaires des manuels. (UCP,

Antennes, 30 juin 2011)

Les manuels d‟apprentissage ont été

distribués aux 445 PP (311 en couture, 85

en menuiserie, 12 en mécanique/réparation,

1 en électricité, 24 en soudure, 11 en

vannerie, et 1 dans le traitement du cuir),

formateurs des apprentis au cours de cette

session.

OK


Follow-up Report

13




15 October 2011


with Responsibility & Deadline 11 A Réviser le document de stratégie sur

l‟apprentissage, voir note technique. (UCP, 30

juin 2011)

11 B Organiser un atelier avec les institutions

et projets concernés afin de présenter la

stratégie d‟apprentissage et les résultats

atteints. (UCP, 30 juin 2011)

Le document élaboré par le projet n‟a pas

encore été révisé. La révision sera réalisée

en concertation avec l‟unité du MSME

déléguée par le MINICOM pour la

pérennisation du programme

d‟apprentissage.

(WDA to be involved in the process)

L‟atelier sera organisé après la révision du

document de stratégie sur l‟apprentissage.

OK, now covered by # 99.

98 Mandater une institution qui a la charge du

programme rural d‟apprentissage.

(MINICOM, 31 mai 2011).

Le programme rural d‟apprentissage sera

sous la supervision du programme manager

du MSME. (WDA was mandated to

implement apprenticeship programme)

OK

99A Conclure un MOU avec cette Institution

relatif à l‟appui conseil et l‟appui direct du

PPPMER. (UCP, 30 juin 2011)

99B Nommer et placer le personnel d‟appui

conseil au sein de cette Institution. (UCP, 30

juin 2011).

Au cours des deux années d‟extension du

Projet, le Projet va partager son expérience

dans la conduite de l‟apprentissage avec ce

programme au sein du MINICOM, procéder

à la révision de la stratégie adoptée si

nécessaire, en collaboration avec d‟autres

institutions chargées de la formation

professionnelle, en particulier le WDA.

Le personnel chargé du suivi des activités

du PPPMER a été mis en place au sein du

MSME.

99A. Share key project documents

with WDA (SPIU, 30 October 2011).

99B. Prepare, discuss and finalize a

concept note on modalities of

collaboration with WDA (SPIU, 15

November 2011).

99C. Prepare an outline of the

apprenticeship programme document

(WDA, 15 December 2011).

99D. Sign an MOU with WDA, with

a view to take over the

implementation from the SPIU (SPIU,

15 January 2012).

100 Participer au TVET development donor

cluster de WDA. (UCP, continu).


110A. Contract PROBAs for

apprenticeship follow-up using the

voucher system (WDA, 15 January

2012)

110B. Inform the districts to provide

graduate apprentices with vouchers

for post-apprenticeship trainings

(WDA, 15 January 2012)

Handicraft Support

49. Evaluer la performance des comités de

gestion des halls des artisans avec un

consultant spécialisé dans la gestion des

coopératives. Le consultant devrait aussi

apporter des recommandations et réviser le

manuel de procédures. (UCP ; 30 juin 2011).

Cette évaluation sera faite par le consultant

qui va mener l‟étude sur l‟artisanat. Le

bureau d‟étude Green and Clean Solutions

(GCS) vient d‟obtenir la non objection pour

réaliser cette étude, et il lui sera demandé de

donner des recommandations appropriées

sur la gestion des halls des artisans et

réviser le manuel de procédures.

49A. Evaluate the performance of the

management committees of the

artisan houses with the help of

cooperative management expert.

(SPIU; 31 Dec 2011)

49B. The consultant should also

revise the related operation manuals.

(SPIU; 15 Dec 2011)


Follow-up Report

14




15 October 2011


with Responsibility & Deadline 50 Organiser une cérémonie de remise

officielle des maisons des artisans et kiosques

construits avec l‟appui du Projet, réunissant

toutes les parties prenantes pour la signature

du protocole d‟accord. (UCP, 30 juin 2011).

Pour garantir l‟utilisation et la gestion des

maisons des artisans conformément à la

mission leur allouée, il a été jugé opportun

que les cérémonies de remise officielle de

ces maisons soient organisées après la mise

en place de la structure qui va assurer la

pérennisation des activités du PPPMER II.

50. Organise an official handover

ceremony of the 13 artisan houses and

kiosks funded by the project, at which

the handover MOU will be signed.

(SPIU; 31 Dec 2011).

60A. Organiser un atelier dans la filière

artisanat avec des acheteurs et designers

internationaux, producteurs et commerçants /

exportateurs nationaux, en vue de développer

de nouveaux produits et introduire de

nouvelles techniques. L‟atelier doit cibler des

acheteurs et designers internationaux,

producteurs et commerçants / Exportateurs

nationaux. (UCP, 30 septembre 2011).

Deux ateliers ont été organisés avec les

designers, acheteurs et volontaires

impliqués dans la promotion de l‟artisanat.

Le premier atelier a regroupé 92 artisans,

designers venant des différents horizons

comme François 1er, designer en couture

contemporaine venant du Paris mais aussi

les experts du CBI et du SIAO. Cet atelier a

été clôturé par un défilé de mode pour 6

meilleurs ateliers de pmer venant de chaque

province du pays. Les gagnants de cette

compétition ont été rémunérés et encouragés

à être plus innovateurs dans les

compétitions à venir.

Les séances de préparation du défilé de

mode ont été organisé par le CF couture,

sous l‟encadrement de François 1er

.

Le second atelier était beaucoup plus centré

sur la relation design et marché. Cet atelier a

été animé par les volontaires venant de

Grande Bretagne et plus de 80 artisans ont y

participé pendant 6 jours. Tous ces ateliers

ont été clôturé par le Ministre du Commerce

et de l‟Industrie.

OK

78 Etablir un plan d‟action des filières pour

les 2 ans, indiquant les étapes clés et les

produits quantifiés à obtenir. (UCP, 30 juin

2011).

Le plan d‟action a été établi et soumis au

consultant du FIDA qui avait fait cette

recommandation, et le plan d‟action a été

adopté.

OK

111. Re-initiate the partnership with

the Community of the Potters of

Rwanda (COPORWA) with a new

MOU. (SPIU, 30 Nov 2011).

Demonstration Units

79A Assurer impérativement l‟équipement et

la mise en route des UD manioc, fruits et miel,

en prenant éventuellement d‟autres

coopératives qui disposent de locaux prêts et

de tous les branchements. (UCP, 30 juin 2011)

79B Etablir avec les UD un calendrier des

sessions de démonstration et les modalités

pour les organiser. (UCP, 30 juin 2011).

Les équipements ont été totalement fournis

pour les UD manioc, fourniture d‟une partie

pour l‟unité Fruits, et en cours d‟acquisition

pour les unités Miel. (Equipments expected

to be supplied by November).

La formation va commencer en novembre

2011 pour les unités manioc, après la mise

en place de ces équipements et

l‟achèvement de la construction des aires de

séchage. (Action plans required)

79A. Involve UNIDO in equipment

inspection and elaborate testing of the

processing equipment of the passion

fruit DU (SPIU; 15 December 2011).

OK

112. Assist all 10 cooperatives with

DUs in updating their business plans

and finalize training & demonstration

work plans. (SPIU; 31 Jan 2012)


Follow-up Report

15




15 October 2011


with Responsibility & Deadline 113. Cooperatives with DUs to

prepare monthly performance reports.

(SPIU; monthly as of 1 Nov 2011)

Technical and Technological Support (FIT/FAC)

80D Revoir les modalités d‟acquisition du

matériel (promotion FIT/FAC) pour raccourcir

les délais d‟acquisition. Préparer une

proposition au FIDA concernant la possibilité

des bénéficiaires de se procurer eux-mêmes

les équipements selon les spécifications et

factures pro forma contenus dans le dossier

approuvé (UCP, 30 mai 2011)

80 E Achever l‟évaluation des dossiers de

demande. (UCP, 30 juin 2011).

Les modalités d‟acquisition du matériel

pour la promotion FIT /FAC ont été revu,

actuellement les bénéficiaires du FIT/FAC

participent au choix des fournisseurs de ces

équipements, les procédures de passation

des marchés sont organisées par eux-

mêmes. Un manuel facilitant ce processus a

été élaboré et mis à la disposition des

bénéficiaires.

Les dossiers jusqu‟à présent ont été évalués.

14 dossiers ont été financé, 27 dossiers

agrées et les processus de financement en

cours, 21 dossiers ont été remis aux

bénéficiaires pour ajustement et correction

OK

4. Financial Services for Rural SME

Credit Lines

55. Signer des contrats de recouvrement avec

les 14 IMF. (UCP ; 30 juin 2011).

Le projet a consulté les IMFs concernés

pour se mettre d‟accord sur les modalités de

recouvrement. Il a été convenu que la tache

de recouvrement soit assignée aux autorités

du district (Access to Finance Forum) pour

qu‟ils soient impliqués dans la

sensibilisation des mauvais débiteurs qui

habitent dans leurs secteurs. Les

correspondances y relative ont été préparée

et seront envoyées aux districts concernés

avant la fin du mois d‟octobre 2011.

55. Sign contracts for recovery of the

credit lines from the concerned MFIs.

(SPIU ; 31 December 2011).

56A. Mener une évaluation d‟impact des

fonds de crédit du projet. (UCP ; 30 juin

2011).

L‟activité n‟a pas été réalisée, mais est

planifiée dans le programme de travail

2011_2012.

56 A. Conduct an assessment of the

status report of the BPR credit line

(SPIU; 31 December 2011).

89. Elaborer un plan d‟évolution des CEAC.

(UCP ; 30 juin 2011).

Le projet est en premier lieu en cours de

négociation de reconnaissance des CEAC

par les Institutions financières partenaires,

puisque jusqu‟à présent cette

reconnaissance n‟est pas acquise. Ensuite,

renforcer la capacité des membres des

CEAC, pour qu‟ils soient effectifs dans

l‟analyse et l‟évaluation des projets. Enfin

uniformiser partout la régularité de la

distribution des primes d‟encouragement en

provenance de la partie des intérêts perçus,

en conformité avec le protocole d‟accord

signé avec ces Institutions financières.

89. Prepare TOR for the CEACs and

modalities to support one member per

CEAC for coordination functions.

(SPIU; 30 November 2011).

101 Redoubler les efforts pour le

recouvrement des créances non performantes.

(BPR, UCP, continu).

Plusieurs visites de travail avec les Banques

Populaires pour le recouvrement des

créances non performantes ont été réalisées,

et les rapports y relatif sont disponibles.

101. Strengthen efforts in credit

recovery, particularly through use of

the Access to Finance Forum and

CEACs. (PCU ; 31 December 2011)


Follow-up Report

16




15 October 2011


with Responsibility & Deadline 102 Conclure un nouveau MOU cadrant bien

les activités à mener par BDF. (UCP, BDF, 30

juin 2011)

Le draft du MOU a été préparé mais n‟est

pas encore signé. Le BDF posait beaucoup

de conditions non prévues, et qui exigeaient

beaucoup de dépenses au projet. Les

négociations sont toujours en cours et nous

comptons sur la présente mission pour

conseils sur la limite du budget et des

activités autorisées dans ce MOU.


103 Redistribuer la part des intérêts revenant

aux membres des CEAC et aux pmer ayant

respecté leurs échéances, comme convenu

dans le MOU. UCP, BPR, 30 juin 2011).

Des concertations menées avec les BPR ont

aboutit à recommander aux banques

concernées de mettre à jour le plus

rapidement possible les listes des membres

des CEAC bénéficiaires de la part de ces

intérêts, pour permettre le décaissement de

ces primes dans la transparence. L‟activité

est toujours en cours.

103. Begin regular payments to

CEAC. (BPR, Duterimbere;

30 November 2011).

104 Signer des accords de recouvrement avec

les UCAPEC. (UCP, UCAPEC ; 31 mai

2011).

Les visites de travail avec UCAPEC pour

conclure des accords de recouvrement ont

été réalisées. Il est ressorti de ces

concertations, particulièrement lors de la

dernière séance de travail du mois d‟août

2011, qu‟avant d‟entamer le processus de

recouvrement, Il fallait mettre à jour la

situation des risques et préciser l‟adresse

actuelle des débiteurs. Les accords de

recouvrement seront signés sur base de ce

document toujours en cours d‟actualisation.

104A. Give notice to UCAPEC, with

a recovery plan. (SPIU; 30

November 2011).

104A. Give notice to CT Byumba,

with a recovery plan. (SPIU; 30

November 2011).

114A. Prepare wholesale credit

transfer agreements for BPR and

Duterimbere crdit lines. (SPIU; 30

November 2011).

114B. Prepare a note on lessons learnt

on wholesale credit lines. (SPIU; 30

November 2011).

Capacity Building

105 Développer un plan d‟action et entamer

les formations pour les SACCO (RCA, UCP,

30 mai 2011)

Les formations ont été effectuées comme

prévues. 60 membres des SACCO et 20

agents du RCA ont été formés en 5 modules

complémentaires, pendant 5 jours pour

chaque module. Selon le contrat avec le

formateur (The Friends Consultant LTD),

les agents formés auront la tâche de former

les autres membres du staff des SACCOs,

afin que tous les 416 SACCOs managers

soient formés avant la fin de l‟année 2011.

105. Prepare a capacity building

workplan for SACCOs. (RCA with

SPIU support; 30 November 2011).

4. Project coordination

General

65A. Etablir un calendrier précis des activités

à mener et des résultats à produire pour tous

les contrats de consultance signés, et suivre de

près la livraison à temps des produits. (UCP ;

30 juin 2011).

65B. Etablir un plan de travail pour les

activités de consultance dont le processus de

recrutement est en cours avec des délais bien

précis. (UCP ; 30 juin 2011).

Les consultants transmettent régulièrement

leur rapport d‟activité mensuel, et leur

paiement est effectué sur base de

l‟appréciation de ces rapports.

OK


Follow-up Report

17




15 October 2011


with Responsibility & Deadline 66. Assurer le suivi auprès du MINECOFIN

pour l‟acquisition des fonds additionnels de

contrepartie. (UCP ; 30 juin 2011).

Le suivi est régulièrement assuré. Les 3

premières tranches du fonds de contrepartie

ont été transférés sur le compte du projet, la

4ème

tranche a été aussi accordé.

66. Increase government‟s budget

allocation to PPPMER II in

compliance with the AWPB and Loan

Agreement. (MINICOM, 31

December 2011)

89. Transférer tous les documents, tableaux et

base de données aux institutions et partenaires

chargés de la continuité du PPPMER II.

(UCP ; 30 juin 2011).

Le rassemblement des documents, tableaux,

base de données et autres informations

relatives aux actions du PPPMER II est

entrain d‟être réalisé, pour leur remise à la

coordination du SPIU, et copies seront

réservé au MINICOM, à l‟ARC et à RDB.

89. Transfer all key project

documents and database to the SPIU

(PCU staff; 31 December 2011)

90. Préparer et envoyer au FIDA un rapport

d‟achèvement du Projet. (UCP ; 30 juin 2011).

Cette recommandation n‟était plus

applicable avec l‟extension du projet.

OK

91. Mettre à jour le site Web du PPPMER

avec les documents clés et les résultats

obtenus. (UCP ; 30 juin 2011).

Le site Web du Projet avait été mis en place,

mais non encore opérationnel. Le SPIU est

entrain de mettre en place un autre site

91. Update PPPMER website with

key documents and success stories.

(SPIU ; 31 December 2011)

M&E and Knowledge Management

69A. Etablir le mode d‟emplois des bases de

données, former les agents SE des antennes.

(UCP ; 30 juin 2011).

69B. Saisir toutes les données existantes sur

les pmer dans les bases de données.

(Antennes, 30 juin 2011).

69C. Suivre l‟exhaustivité et la fiabilité des

données saisies et les compléter.

(UCP/Antennes ; 30 juin 2011).

Les chargés de suivi et évaluation au niveau

des antennes avaient été formés sur

l‟utilisation de la base de données. Cette

formation est prévu aussi pour les CER

gestionnaires de cette base au niveau des

Districts.

La mise à jour et le complément des

informations existantes seront réalisés par

les CER après leur formation.

L‟Assistant au suivi et évaluation est chargé

régulièrement de la vérification et suivi de

la fiabilité de cette base.


83. Préparer des reportages sur une dizaine au

moins de success stories du projet, et les

publier (articles, illustrés, émissions radio,

vidéo). (UCP ; 30 juin 2011).

Les reportages ont été faits sur la couture,

l‟apprentissage des jeunes aux métiers, les

formations en technologies améliorées, les

pmer en transformation des fruits,

l‟apiculture, et la gestion des maisons des

artisans. L‟exploitation de ces reportage est

en cours.

83. Prepare at least a dozen success

stories on project achievements

through articles, documentaries etc.

(PCU; 30 December 2011)

84. Réaliser l‟étude d‟impact du projet.

(UCP ; 30 juin 2011).

Avec l‟extension du projet pour 2 ans, cette

étude a été reporté plus tard (1 année avant

l‟achèvement du projet).

OK

85. Mettre à jour les informations et données

qui serviront de base au rapport d‟achèvement

du projet. (UCP ; 30 juin 2011).

Les informations et données sont

régulièrement collectées, mais le rapport

d‟achèvement n‟a pas été réalisé suite à

l‟extension du projet pour 2 ans.

OK

86. Mettre en œuvre toutes les activités du

plan d‟achèvement du projet en respectant

impérativement les délais. (UCP ; 30 juin

2011).

Ce plan n‟a pas été mis en exécution, car

l‟achèvement a été reporté au 30 juin 2013.

OK

87. Elaborer les listes d‟inventaires

recouvrement des soldes des crédits-baux et

transférer de manière documentée les biens au

Ministère de tutelle. (UCP ; 30 juin 2011).

Les soldes de crédit-baux ont été inventoriés

et seront transmis au Président du Comité de

Coordination Nationale du Projet pour la

décision de leur affectation définitive.

OK

88. Préparer des études thématiques portant

sur les activités stratégiques importantes

menées par le projet. (UCP ; 30 juin 2011).

Ces études n‟ont pas encore été réalisées 88. Prepare thematic studies on key

strategic activities undertaken by the

project (SPIU; 31 December 2011)


Follow-up Report

18




15 October 2011


with Responsibility & Deadline 96. Procéder à une évaluation de l‟impact du

partenariat avec COPORWA. (UCP ; 30 juin

2011).

Cette évaluation est prévue au cours de

l‟année 2011_2012

96. Commission an impact

assessment of the partnership with

COPORWA (SPIU; 31 December

2011)

Some key PPPMER PCU staff whose

contracts have been renewed up to

December 2011 must take their leave within

the three months‟ period, yet they are

needed to support SPIU during the

extension period for smooth handover.

115. Extend contracts or agree on

compensation for leave for key staff

of the PCU of PPPMER (SPIU, 15

December 2011)

Financial Management & Procurement

92. Etablir et faire le suivi rapproché d‟un

plan de décaissement mensuel jusqu‟à

prévisionnel allant jusqu‟à la clôture du projet.

(UCP ; 30 juin 2011).


93. Achever sans exceptions, toutes les

passations des marchés au 31 mars 2011.

(UCP ; 30 juin 2011).

Avec l‟extension du projet jusqu‟au 30 juin

2013, cette recommandation n‟ait plus

applicable.


94 Elaborer un plan de travail et des TdR

clairs pour la période d‟extension précisant les

types d‟activités de soutien et les modalités et

ressources à mettre en œuvre avec chaque

partenaire. (UCP ; 30 juin 2011).

Le plan de travail pour l‟année 2011_2012 a

été élaboré et acquis la non objection du

FIDA. Les MOU avec les partenaires

techniques qui vont pérenniser les activités

du PPPMER II sont en cours

d‟actualisation.

94. Revise the AWPB in line with the

Aide Mémoire. (SPIU; 15 December

2011).

95. Créer des dossiers individuels pour chaque

contrat, y compris des copies numérisées de

chaque contrat, toutes les modifications ou

ajouts, les certificats d‟avancement et les

CMF. (UCP ; 30 juin 2011).

Ces dossiers ont été crées avec toutes les

spécifications demandées

95. Update electronic archive of every

contract and MOU, all amendments

and CMF in a folder with a reference

number. (SPIU; 31 December 2011,

then continuous)

116. Submit for IFAD no-objection,

the SPIU administrative and finance

procedures manual. (SPIU; 31

December 2011)

117. Appoint an SPIU “gender issues

champion”. (SPIU; 30 Nov. 2011)

118. Implement the pending 2009/10

audit recommendations.

(SPIU; 31 December 2011)

119. Establish a comprehensive

national database on RSME service

provision based on the PROBA

scheme (SPIU; 31 January 2012)

120. Require gender disaggregated

information in project and partners‟

reporting (SPIU; 30 November 2011)


Follow-up Report

19

ANNEX 2 PROJECT FINANCIAL STATUS

A. Basic Facts

Country Rwanda Project ID 1276 Loan/Grant No. 613-RW

Project Rural Small and Micro Enterprise Promotion Project - Phase II

(PPPMER II) Supp. Loan/Grant

Date of Update: 28-Oct-2011 Last Supervision May 2010 Financing terms HC

Supervising Inst. IFAD/IFAD No. of Supervisions 10

USD

million Disb.rate%

Approval 11-Sep-03 Quality at entry rating Total costs 17.57

Agreement 03-Nov-03 Effectiveness lag 9.3 IFAD loan 14.91 89%

Effectiveness 15-Jun-04 Problem project No DSF grant

MTR Sept. 2008 IFAD grant

Current completion 30-Jun-13 Last Amendment Domestic 2.65

Current closing 31-Dec-13 Last Audit Dec-2010 Cofinancing

No. of extensions 1 Cofinanciers

B. Project Performance Ratings

(6) highly satisfactory; (5) satisfactory; (4) moderately satisfactory; (3) moderately unsatisfactory; (2) unsatisfactory; (1) highly unsatisfactory

B.1 Fiduciary Aspects Last Current B.2 Project implementation progress Last Current

1. Quality of financial management 5 5 1. Quality of project management 3 4

2. Acceptable disbursement rate 5 3 2. Performance of M&E 5 4

3. Counterpart funds 5 3 3. Coherence between AWPB &

implementation 3 4

4. Compliance with loan covenants 5 5 4. Gender focus 5 4

5. Compliance with procurement 4 4 5. Poverty focus 5 4

6. Quality and timeliness of audits 4 5 6. Effectiveness of targeting approach 5 4

7. Innovation and learning 4 4

B.3 Outputs and outcomes Last Current B.4 Sustainability Last Current

1. Strengthening Partner Capacities 4 3 1. Institution building (organizations, etc.) 3 3

1.1 Strengthening SMEs, cooperatives and

SPs 4 3 2. Empowerment 4 4

1.2 Policy and Legislative Support 4 n/a 3. Quality of beneficiary participation 5 5

2. Operational Support to Rural SMEs 4 4 4. Responsiveness of service providers 5 4

2.1 Apprenticeship training 5 5 5. Exit strategy (readiness and quality) 3 3

2.2 & 2.3 Value Chain Support 4 4 6. Potential for scaling up and replication 5 5

3. Financial Services for Rural SME 4 3

4. Project Coordination 4 3

C. Overall Assessment and Risk Profile Last Current

C.1 Physical/financial assets 5 4

C.2 Food security 5 5

C.3 Overall implementation progress (Sections B1 and B2) 4 4

Rationale for implementation progress rating

C 4 Likelihood of achieving the development objectives (section B 3 and B4) 4 3

C 5 Risks Short description of major risks for each section and their impact on achievement of development objectives and

sustainability


Follow-up Report

20

Fiduciary aspects The financial performance is overall satisfactory.

Project implementation progress

Most physical targets were achieved, some even exceeded. Only the

technological support activities and to a lesser extent the rural finance

activities remain far behind.

No progress so far relative to the targets of the extension period.

Outputs and outcomes

Delays in the transfer of project activities to partner agencies and in setting up

the PROBA Scheme would risk the achievements of the outputs and outcomes

of the extension period.

The demonstration units (UD) are still not functional.

Sustainability

The 2-year extension of the project is oriented towards the transfer of project

systems and advisory support to national institutions in support of RSMEs, the

development of a national apprenticeship program and the establishment of

sustainable financial services for RSMEs. To this, the district-implemented

PROBA Scheme was added. The SPIU staff need to work closely with these

teams to address the risk of non-sustainability of project support activities.

Description of supervision modality

The project is under direct supervision by IFAD since 1 January 2008.

In 2010, 26 non objections were provided with an average turn-around time of 2.2 working days.

2011 so far: 20 non objections, average turn-around time of 1.2 working days.

Progress Indicators Last Current

Frequency of supervision n/a n/a

Quality of supervision n/a n/a

Impact on project implementation n/a n/a

Overall Supervision Rating n/a n/a

Justification of rating

D. Follow-up Action

Issue/problem Recommended Action Timing Status

None - - -

Additional observations:

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ANNEX 3: PROJECT STATUS OF FUNDS

Table 1: Cumulative Financial execution of the project by category and by financier as at 30 September 2011 (FRW „000)

Table 2: Cumulative Financial execution of the project by component and by financier as at 30 September 2011 (FRW „000)

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Table 3: Financial execution of the 2011/12 AWPB of the project by category and by financier as at 30 September 2011 (FRW „000)

Table 4: Financial execution of the 2011/12 AWPB of the project by component and by financier as at 30 September 2011 (FRW „000)

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ANNEX 4: NO-OBJECTION TRACKING SHEET

Overall 2.0 working days average turn-around time 2.1 1.6

Description of Goods/ Works or ServicesDATE OF FIRST

RECEPTION

DATE OF

COMPLETE

RECEPTION

Date No-Objection

Provided By CPMREMARKS

WORKING

DAYS in ESA

DATE OF FIRST

RECEPTION

DATE OF

COMPLETE

RECEPTION

Date No-

Objection

Provided by

CPM

REMARKSWORKING

DAYS in ESA

NO 001 - Recrutement antenne Nord - passations

de marchés, secrétaire comptable25-Jan-08 29-Jan-08 2 n/a

NO 002 -Etude de faisabilité sur des unités de

transformation des produits agricoles21-Feb-08 26-Feb-08 3 n/a

NO 003 - PTBA 2008 19-Dec-07 21-Jan-08 19 n/a

NO 004 - renouvellement contrats des PSE 11-Mar-08 14-Mar-08 3 n/a

NO 005 - Audit compte 2007 9-May-08 9-May-08 0 n/a

NO 006 - SNV 5-Aug-08 20-Aug-08 20-Aug-08 0 n/a

NO 007 - DAO modele halls expostitions 18-Aug-08 19-Aug-08 1 n/a

NO 008 - étude filiere 17-Oct-08 21-Oct-08 2 n/a

NO 009 - Appui pubblicité pmer 22-Oct-08 declined on 24/11/08 n/a n/a

NO 010 - recrutement secrétaire comptable 30-Oct-08 31-Oct-08 1 n/a

NO 011 - collaboration avec PADC-GR 7-Nov-08 8-Nov-08 0 n/a

NO 012 - recrutement expert etude filiere 13-Nov-08 14-Nov-08 1 n/a

NO 013 - rapport analyse maison rubavu 2-Dec-08 4-Dec-08 4-Dec-08 0 n/a

NO 014 - TdR agent de SE d'antenne 23-Dec-08 24-Dec-08 1 n/a

NO 015 - Recrutement conseillers 4 filieres 8-Jan-09 8-Jan-09 0 3-Apr-09 8-Apr-09 13-Apr-09 seulement 3 conseillers 1

NO 016- PTBA 2009 et 1er sem. 2010 15-Jan-09 20-Jan-09 2-Feb-09 9 n/a

NO 017- enquete nutritionnelle et RIMS 17-Mar-09 19-Mar-09 2 n/a

No 018 - recrutement 4 agents SE 27-Mar-09 27-Mar-09 0 n/a

No 018b - recrutement 4 agents SE 8-Apr-09 14-Apr-09 2 n/a

No 019 - manuel de procédures du FAC et FIT 14-Apr-09 declined on 15/04/09 n/a n/a

No 019b - manuel de procédures du FAC et FIT

(révisé)10-May-09 21-May-09 21-May-09 0 n/a

NO 020 - reallocation of funds to Crafts Industry

Secretariat29-Apr-09 29-Apr-09 1-May-09 1 n/a

NO 021 - vélos 6-May-09 6-May-09 6-May-09 0 n/a

NO 022 - Audit comptes 2008 20-May-09 25-May-09 changed decision 3 n/a

STAGE ONE (Review of Bidding Documents) STAGE TWO (Review of Evaluation Reports)

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RECEPTION

DATE OF

COMPLETE

RECEPTION

Date No-Objection


WORKING

DAYS in ESA

DATE OF FIRST

RECEPTION

DATE OF

COMPLETE

RECEPTION

Date No-

Objection

Provided by

CPM

REMARKSWORKING

DAYS in ESA

NO 023 - avenant au MOU avec BPR 20-May-09 21-May-09 declined on 25/05/09 n/a n/a

NO 023b - avenant au MOU avec BPR 26-Jun-09 declined on 29/06/09 n/a n/a

NO 023c - avenant au MOU avec BPR 30-Jun-09 2-Jul-09 2 n/a

NO 024 - MOU avec RDB 18-Jun-09 declined on 22/06/09 n/a n/a

NO 024b - MOU avec RDB 3-Jul-09 3-Jul-09 0 n/a

NO 025 - fournitures de bureau (3 lots) 26-Jun-09 29-Jun-09 1 6-Nov-09 8-Nov-09 0

NO 026. Fruit processing equipm., Masaka 7-Jul-09 7-Jul-09 0 n/a

NO 026b. Fruit processing equipm., Masaka 7-Jul-10 9-Jul-10 2 29-Oct-10 3-Nov-10 3

No 027 . Enquete nutritionnelle ??? n/a 13-Jul-09 16-Jul-09 3

NO 028. PTBA 2010 17-Jul-09 declined on 19/08/09 n/a n/a

NO 028b. PTBA 2010 (revisé) 17-Sep-09 15-Oct-09 19 n/a

NO 029. Construction kiosque à Kibehobudget < threshold for

review, thus no NO required n/a 14-Aug-09 19-Aug-09 2

NO 030. 4 pickup 17-Aug-09 21-Aug-09 3 5-Nov-09 6-Nov-09 1

NO 031 MOU entre PPPMER et ARC 20-Aug-09 declined on 31/08/09 n/a n/a

NO 032 MOU avec Rwanda Work Force

Development Authority28-Aug-09 1-Sep-09 2 n/a

NO 033 note conceptuelle des UD (manioc) 28-Aug-09 2-Sep-09 3 n/a

NO 033b note conceptuelle des UD (manioc) 24-Sep-09 declined on 28Sep09 n/a n/a

NO 033c note conceptuelle des UD (manioc) 9-Nov-09 9-Nov-09 0 30-Jun-10 6-Jul-10 4

NO 034b contrats avec 3 IMF 1-Oct-09 6-Oct-09 3 n/a

NO 034c modified Duterimbere contract 30-Dec-09 5-Jan-10 2 n/a

NO 035. TOR for the study on crafts industry 12-Nov-09 declined on 14Nov09 n/a n/a

NO 035b. TOR for the study on crafts industry 3-Mar-10 4-Mar-10 1 28-Dec-10 5-Jan-11 5-Jan-11 0

NO 035d. consultancy on craft sector study n/a 2-Mar-11 3-Mar-11 1

NO 035e. consultancy on craft sector study n/a 21-Mar-11 22-Mar-11 22-Mar-11 0

NO 035f. consultancy on craft sector study n/a 29-Jun-11 declined on 30-Jun-11 n/a

NO 035g. consultancy on craft sector study n/a 30-Sep-11 5-Oct-11 5-Oct-11 0

NO 036 MOU avec CIS 22-Dec-09 23-Dec-09 1 n/a

No 037. Note conceptuelle, UD maracuja 6-Jan-10 8-Jan-10 2 n/a

NO 038. travaux maison d. artisans Bugesera 26-Feb-10 28-Feb-10 0 17-May-10 18-May-10 1

NO 039. formation à l'ARC (COOPEC) 26-Feb-10 declined on 28Feb10 n/a n/a

NO 039b. formation à l'ARC (COOPEC) 15-Apr-10 20-Apr-10 3 6-Oct-10 7-Oct-10 declined on 8Oct10 n/a

NO 039d. formation à l'ARC (COOPEC) n/a 15-Oct-10 28-Oct-10 9

NO 039e. formation à l'ARC (COOPEC) n/a 29-Nov-10 29-Nov-10 0

NO 040. formation à l'ARC (gestion de coop) 26-Feb-10 declined on 1-Mar-10 n/a n/a

NO 040b. formation à l'ARC (gestion coop) 15-Apr-10 19-Apr-10 2 6-Oct-10 7-Oct-10 declined on 8Oct10 n/a

NO 040c. formation à l'ARC (gestion coop) n/a 15-Oct-10 declined on 20 Oct10 n/a

NO 040d. formation à l'ARC (gestion coop) n/a 21-Oct-10 25-Oct-10 27-Oct-10 2

NO 040f. formation à l'ARC (gestion coop) n/a 29-Nov-10 29-Nov-10 0

NO 041. Equipement FIT FAC 4-Mar-10 6-Mar-10 1 17-Dec-10 20-Dec-10 1

NO 042. Achat de 21 motos pour l'ARC 15-Apr-10 20-Apr-10 3 n/a

NO 043. Recruitment Tailoring VC Advisor 28-Jun-10 30-Jun-10 2 n/a


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RECEPTION

DATE OF

COMPLETE

RECEPTION

Date No-Objection


WORKING

DAYS in ESA

DATE OF FIRST

RECEPTION

DATE OF

COMPLETE

RECEPTION

Date No-

Objection

Provided by

CPM

REMARKSWORKING

DAYS in ESA

NO 044. PTBA 2010/11 31-Jul-10 12-Aug-10 8 n/a

NO 045. MOU avec COPORWA 31-Jul-10 12-Aug-10 8 n/a

NO 046. Recruitment results 30-Aug-10 30-Aug-10 0 n/a

NO 047. Recruitment of craft Advisor 9-Sep-10 10-Sep-10 0 n/a

N0 048. 4 UD apicoles 21-Sep-10 23-Sep-10 2 n/a

NO 049. RFP for SPIU 24-Sep-10 24-Sep-10 0 28-Dec-10 5-Jan-11 5

NO 049c. Financ Eval RFP for SPIU n/a 26-Jan-11 27-Jan-11 1

NO 049d. SPIU Implementation process 21-Feb-11 22-Feb-11 1 14-Mar-11 15-Mar-11 1

NO 049f. SPIU Implementation process 2-May-11 declined on 11-may-11 n/a n/a

NO 049g. Additional Work for CDC 10-Jun-11 7-Jul-11 8-Jul-11 info requested on 15 June 1 n/a

NO 050. fruit processing equipment 22-Oct-10 27-Oct-10 27-Oct-10 based on NO 041 0 n/a

NO 050d. Adding a company to NO 050 29-Oct-10 declined on 29Oct10 n/a n/a

NO 051. MOU with BRD on BDF 26-Oct-10 1-Nov-10 4 n/a

NO 052.Construction drying machine shelter 9-Nov-10 1-Dec-10 declined on 8-Dec-10 n/a n/a

NO 053. acquisition of 27 motorcycles 9-Nov-10 9-Nov-10 0 26-Jan-11 26-Jan-11 0

NO 054. MOU avec RDB 30-Nov-10 2-Dec-10 2-Dec-10 0 n/a

NO 055. Achat 15 motos for BDS 17-Feb-11 21-Feb-11 2 18-Apr-11 19-Apr-11 1

NO 056.Business Advisor Appoint by RDB 23-Feb-11 4-Mar-11 6-Mar-11 0 n/a

NO 057. Recrutement CF fruits et manioc 30-Mar-11 8-Apr-11 13-Apr-11 3 n/a

NO 058. Application of new salary 31-Mar-11 31-Mar-11 0 n/a

NO 059. Mini PTBA (Mar-Jun11) 8-Apr-11 declined on 13-Apr-11 n/a n/a

NO 059b. Mini PTBA 19-Apr-11 declined on 25-Apr-11 n/a n/a

NO 059c. Mini PTBA 12-May-11 13-May-11 1 n/a

NO 060. TOR Audit of the BPR credit line 13-Apr-11 declined on 14-Apr-11 n/a n/a

NO 061. PTBA 2011-2012 8-Jul-11 13-Jul-11 declined on 13-July-11 n/a n/a

NO 061b. PTBA 2011-2012 21-Jul-11 declined on 1-Aug-11 n/a n/a

NO 061c. PTBA 2011-2012 8-Aug-11 declined on 10-Aug-11 n/a n/a

NO 061d. PTBA 2011-2012 12-Aug-11 16-Aug-11 1 n/a

NO 062. Audit of PPPMER credit lines 13-Jul-11 15-Jul-11 2 n/a

NO 063. MoU entre RCA et PPPMER-II 15-Jul-11 declined on 20-july-11 n/a n/a

NO 064. Complaint days off 21-Sep-11 declined on 23-Sep-11 n/a n/a

NO 065. 3-mth extension of PCU staff 21-Sep-11 23-Sep-11 2 n/a

NO 66. recruitment SPIU staff 21-Sep-11 23-Sep-11 only 3 staff 2 13-Oct-11 13-Oct-11 the remaining 3 staff 0

NO 66c. specialist in charge of Market access 3-Nov-11 8-Nov-11 2 n/a

NO 67. contract ext., MSME Design Team 14-Oct-11 14-Oct-11 0 n/a


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ANNEX 5: COMPLIANCE WITH LOAN COVENANTS

Section/Covenants Objectives/Execution

Agreed date

Status

SECTION 2.03 a): Special account. The borrower opens and maintains, for the purpose of

receiving the loan proceeds, a special account in USD in the National Bank of Rwanda (BNR)

Immediately after the signing of the loan

agreement

Done

SECTION 3.02 b): Annual Work Plan and Budget. The project shall submit the draft AWPB to

the CNCP before to be submitted to the Fund and the Cooperating Institution for comments and

approval

At least 45 days before the beginning of the

financial year

Deadline not respected

SECTION 3. 03 : Project Account. Within a reasonable time after the effective date, the lead

project agency shall open and maintain, for the financing of the project, a project account in local

currency within a bank acceptable to the Fund.

Immediately after the entry-into-force of

PPPMER II

Done

SECTION 3. 05 b) Availability of additional resources. On a request by the PCU and on the

basis of the AWPB, the borrower shall make available, in the project account, a first deposit

amounting to USD 30 000 equivalent to the needs for the first year.

Immediately after the entry-into-force of

PPPMER II

Done

SECTION 3. 05 c) Availability of additional resources. The borrower will regularly make

disbursements to the project account in accordance with the provisions set in AWPB. Counterpart

funds will be earmarked to the Public Investment Program (PIP)

In accordance with the AWPB Covenant respected. However

2011/12 allocations are very low

compared to current AWPB.

SECTION 3. 06 : Procurement. All procurement of goods, civil works and services needed by

the project and financed by the proceeds of the Loan and Grant shall be carried out in accordance

with Schedule 4

Continuous activity Covenant respected. Procedures are

followed and but contract register

needs to be updated

SECTION 5. 02 : Audit Reports (…) The Lead project agency (…) presents a certified copy of

the audit report stipulated in Section 9.03 (Audit of accounts) in the general conditions to the Fund

and the Cooperating Institution within six months after the end of that fiscal year

Within six months after the end of that fiscal

year

Covenant respected. The Office of the

Auditor General has completed its

audit mission for the 2010/11 fiscal

year.

ANNEX 3 A Organization and Management 2.1. Establishment. The Lead Project Agency

establishes a National Project Steering Committee (PSC)) in accordance with its national

procedures

2.1. Establishment of PSC Done

ANNEX 3 B Modalities of project’s exit strategy towards professional organizations

Exit strategy Despite a noted delay, the project is

being integrated in the SPIU/MSME

Program and is transferring some of

its activities in national institutions

ANNEX 3A Additional Commitments 4. Insurance of Staff The borrow ensures that its staff is insured

against risk of diseases and accident, in

accordance with national practices

Done. Personnel has a health

insurance with RAMA


Follow-up Report

27

APPENDICES


Follow-up Report

29

APPENDIX 1: AGRICULTURE VALUE CHAINS

A. Introduction

1. The project support to agricultural value chains development is mainly focused on

establishing demonstration units (DUs) on cassava, maracuja and honey. Thus, this appendix reviews

the progress made by the project with regard to 10 DUs, which include 5 cassava DUs, 4 honey DUs

and 1 maracuja DU, and makes practical recommendations in their support. It provides more details

on DUs implementation status including main constraints met. The mission visited 2 DUs for cassava

(CATM in Gisagara district and URUGANGAZI in Nyanza district), 1 for maracuja

(COVAFGA/Gakenke district) and 1 for honey (UNICOPAV/Burera district). In carrying out its

tasks, the mission worked in close consultation with the SPIU staff, districts staff, former CERs, FEs

and managers of cooperatives hosting DUs.

B. Implementation status

2. Despite previous mission recommendations, all 10 but one DUs are still not operational.

Delays were experienced in constructing DUs buildings and in supplying equipments required to start

activities. The May 2011 follow-up mission recommended that all equipments be supplied by

15 June 2011. To date, only cassava DUs received equipments as shown below.

3. Cassava DUs are hosted by primary cooperatives which were chosen for their good

performances in organization & management. These cooperatives were trained in management and

technical aspects (mainly cassava production) by PPPMER II and other projects, including RSSP.

However, even though those cooperatives were rated among the best performing, the mission noted

that key staff were insufficiently trained and still need refresher training. In particular, the staff met

didn‟t have a good knowledge of how to calculate the final product cost. Business plans were

prepared for 3 DUs (CATM, URUGANGAZI and NYEGANYEGA/Huye district) in January 2010,

covering a period of 3 years (2010-2012). To date, the implementation of these plans is not yet

effective. Business plans for 2 cassava DUs (COPEBUGA/Bugesera district and KIAI/Gatsibo

district) are not yet prepared. It appeared from discussions held with CATM that the replacement of

equipment was not taken into account in these business plans. This is critical since some equipment

such as plastic tents cannot be used more than 4 years. The mission found out that MOUs describing

responsibilities and obligations for both the project and the cooperative were signed with only 3

cassava cooperatives (CATM, KIAI and URUGANGAZI).

4. The building construction of all DUs except KIAI was financed mainly by MINICOM. For

KIAI, the building was given by the RSSP but it did not include fermentation tanks. Two

fermentation tanks were then included in the PPPMER support package. It should be noted that 2

DUs (COPEBUGA and URUGANGAZI) have no water and therefore cannot start cassava

processing. From discussions held with the Chairman of URUGANGAZA, it appears that the district

is committed to support the cooperative in solving the water problem since the district performance

contract includes the functionality of URUGANGAZA‟s DU. It should be also noted that this DU

will be part of locations covered by the Red Cross ongoing water supply project in Nyanza district.

The rectification and completion of cassava fermentation tanks and drying beds of COPEBUGA‟s

DU has started but is not yet finished. COPEBUGA is also struggling to get water supplied in the DU

before it starts its activities. To this end, the cooperative which is owned by persons living with HIV,

is seeking support from the district. In addition, it envisages to raise funds from its members to

contribute to the water supply. The case of NYEGANYEGA is much more worrying since its roof

structure has been taken away by a storm. The rectification and completion of cassava fermentation

tanks and drying beds has not yet started. It waits for the roof structure to be restored. The required

works will be financed by MINICOM.

5. It should be noted that the buildings of the DUs have not yet been officially handed to

cooperatives. In addition, the ownership status of DU buildings needs to be clarified. The DU plot of


Follow-up Report

30

URUGANGAZI, for instance, was recently registered in the cooperative‟s name, whereas the DU

plot of CATM is under the lease system. The ownership of DUs should be harmonized for all

cooperatives. To facilitate cooperatives access to loans, they should be provided with the title deeds

of DUs plots.

6. Equipment was supplied to cassava DUs by 30 May 2011. Each of the 5 cassava DUs

received from the project the following equipment: i) materials for installation of solar tent dryers

(plastic tent, metallic trellis, wood timbers, cement, nails, metallic mesh); ii) 2 manual cassava

chippers; iii) one hammer mill with a diesel engine; and iv) 10 solar tent driers (10m x 2.60m) with

the installation labour paid by PPPMER. The beneficiaries contributed to: i) site preparation; ii)

wood trucks for construction; and iii) stones and sand collection. The detailed cost of the DUs by

cooperative is shown in the table below, with an estimate of the training cost of cooperative members

during production trials (20 persons per cooperative). At the exception of NYEGANYEGA which

has not completed the participation of beneficiaries, the participation rate of beneficiaries for other

cooperatives varies from 7.7% to 15.3% of the total cost. Two DUs (CATM and URUGANGAZI)

received additional support from RSSP including a covered shed used for receiving, peeling and

washing tubers.

Table 1: PPPMER Support and own Contributions to the Cassava DUs (RWF)

CATM URUGANGAZI NYEGANYEGA KIAI COPEBUGA

PPPMER participation

Equipment 14,682,000 14,682,000 14,682,000 14,682,000 14,682,000

Dryer construction materials 3, 826,000 3,166,250 4,650,000 5, 942,000 4,882,750

Dryer construction 2, 242,000 2, 134,000 2, 510,000 2,119,276 2, 998,000

Training (transportation,

meals, training supplies, DSA for trainer)

351,0002 351,000 351,000 351,000 351,000

Total participation 15,033,000 18,199,250 19,683,000 17,152,276 19,915,750

% participation 92.3 89.5 99.8 84.7 88.0

Cooperative participation

Stones 450,000 800,000 ?3 750,000 320,000

Sand 550,000 750,000 ? 500,000 720,000

Gravel 120,000 ?

Wood stems 180,000 200,000 ? 1,750,000 320,000

Site preparation 20,000 200,000 ? 55,000 980,000

Nails (cover sheets) 24,000 ?

Cleaning ? 120,000

Water 9,000 ? 80,000

Guard shed construction ? 135,000

Participation to training cost 39,000 39,000 39,000 39,000 39,000

Total participation 1,248,000 2,133,000 39,000 3,094,000 2,714,000

% participation 7.7 10.5 0.2 15.3 12.0

TOTAL 16,281,000 20,332,250 19,722,000 20,246,276 22,629,750

Source: PPPMER, Cassava and fruit value chain adviser

7. The mission found some of the equipment, particularly the chippers, in miserable condition,

with urgent need for replacement by the manufacturer. The cassava mills have not yet proven their

functionality, and need immediate elaborate testing at all 5 locations. Since the quality warranty

period for chippers and mills will expire end-November 2011, production trials should start

immediately to identify defaults of these equipment before the warranty expiry. Even though some

DUs cannot fully function without water, there is a possibility to test the equipment by processing

cassava from clients living around the DUs. In addition, it was noted that some materials were

oversupplied. These materials should be owned by the cooperatives and used as spare parts.

8. Honey and Maracuja DUs. The 4 cooperatives which will host honey DUs are actually 2

primary cooperatives (CAR/Gicumbi district and KOPAKI/Kirehe district) and 2 unions

(UNICOPAV and UNICOPAIGI/Rutsiro district) with 6 participant cooperatives each. These

2 AWPB 2011/12 total cost by session is estimated at RWF 390,000. Beneficiaries will pay 10% while the project will pay 90% of the cost. 3 Not yet known


Follow-up Report

31

cooperatives and unions, which are classified among the best performing SMEs, were supported by

SNV in preparing their business plans. In addition, they received technical, management and

marketing trainings with PPPMER support. The same training was provided to COVAFGA hosting

the maracuja DU. All cooperatives also participated in study tours organised by PPPMER, which

were aimed at improving the cooperatives‟ technical and management skills. COVAFGA proved to

be the best performing agro-processing cooperative supported by the project, as confirmed by its

awards received at provincial and national fairs. The chairman of COVAFGA was recently trained on

“Women entrepreneurship” at the School of Finance Banking. After the training, she presented a 5-

year (2012-2016) business plan for her cooperative and got an award for the quality of the business

plan presented. Like cassava cooperatives, the implementation of both honey and maracuja business

plans is not yet effective. The mission found that MOUs describing responsibilities and obligations

for both the project and honey and maracuja cooperatives were not yet signed. This should be done

before the equipment supply.

9. Most of the honey cooperatives and unions use traditional hives and rudimentary equipment

for honey production. While this cautious approach is laudable, as a result their production is low

compared to their potential if they had modern hives and equipment. Nonetheless, for these

cooperatives to serve as honey DUs, missing improved equipment was identified by cooperatives

themselves with the project support. The contract to acquire the proposed equipment was signed end-

April with a delivery period not exceeding 45 days. The supplier failed to meet the contract

obligations and the honey equipment is not yet delivered. It is expected to be supplied in November.

During the mission, the honey equipment was inspected with the involvement of the UNIDO expert

and was found to be of good quality. The table below shows the quantity and the cost of honey

equipment to be supplied to the 4 cooperatives, with an estimate of the training cost of cooperative

members during production trials (20 persons per cooperative).

Table 2: PPPMER Support to the Honey DUs (RWF)

MATERIAL Qty

KO

PA

KI

CA

R

UN

ICO

AP

IGI

UN

ICO

PA

V

Un

it C

ost

To

tal

1 Drums soaker 2 1 1 310,000 620,000

2 Pouring buckets 3 1 1 1 35,000 105,000

3 Jerrycans 20L 6 1 1 5,000 30,000

4 Refractometer 3 1 1 1 120,000 360,000

5 Mixer 3 1 1 1 800,000 2,400,000

6 Skimmer 4 1 1 1 1 450,000 1,800,000

7 Candle machine 4 1 1 1 1 940,000 3,760,000

8 Waffle hand synthetic 3 1 1 1 450,000 1,350,000

9 Brushes for bees 4 1 1 1 1 15,000 60,000

10 Radial extractors 2 1 1 899,000 1,798,000

11 Source pans 8 2 2 2 2 350,000 2,800,000

12 Candle molds 90 22 22 23 23 10,000 900,000

13 Twist-off capsules 13,048 3,262 3,262 3,262 3,262 60 782,880

14 Water tank 1 1 860,000 860,000

15 Encapsulators 3 1 1 1 450,000 1,350,000

16 Stainless spoon for honey 4 1 1 1 1 80,000 320,000

17 Carrier bars for bees 10 4 4 4 4 2,500 25,000

18 Bee smoker with galvanic protection 2 1 1 50,000 100,000

19 Uncapping folk 1 1 12,000 12,000

20 Overall without gloves 1 1 64,000 64,000

21 Gloves (pair) 1 1 8,000 8,000

22 Hives 12 12 216,000 2,592,000

Total 22,096,880

Training

1,560,0004

Source: PPPMER, Cassava and fruit value chain adviser.

4 The AWPB 2011/12 gives FRW 390,000 for training in each DU, that is RWF 390,000x4=RWF 1,560,000. For 4 honey DUs,

beneficiaries will participate for 20% in the costs.


Follow-up Report

32

10. With project support, COVAFGA identified required equipment for maracuja processing to

improve its performance. The contract to acquire the proposed equipment was signed end-February

with a delivery period not exceeding 7 months. The supplier of honey equipment was also selected to

supply maracuja equipment. Most of the equipment supplied to COVAFGA didn‟t comply with the

technical specifications. The supplier was thus requested to replace it. It is foreseen that all maracuja

equipment be supplied before end-December 2011. To guarantee its quality, it was agreed that

UNIDO be involved in their inspection during the elaborate testing. The table below shows the

quantity and the cost of maracuja equipment to be supplied to COVAFGA, with an estimate of the

training cost of cooperative members during production trials (20 persons per cooperative).

Table 3: PPPMER Support to the Maracuja DU (RWF)

PPPMER participation Qty Unit Cost Total Cost

Equipment

Cooking kettles 2 2,575,940 5,151,880

Refractometer 1 138,000 138,000

Bottle sealing machine 1 450,000 450,000

Vinometer 1 54,000 54,000

Electric centrifugal separator 1 1,183,540 1,183,540

Filter press 1 2,513,400 2,513,400

Electric pasteurizer 1 3,481,000 3,481,000

Juice handling tank 1 2,088,600 2,088,600

Juice pump 1 650,000 650,000

2 Dater 2 52,000 104,000

2 Oil extractors 2 100,000 200,000

Training 390,0005

TOTAL (RWf) 16,404,420

Source: PPPMER, Cassava and fruit value chain adviser.

C. Next Steps

11. Next steps to get DUs operational include training of cooperative members during production

trials, identification of interested cooperatives and individual SMEs to be trained during

demonstration sessions, updating business plans, preparation of work plans, training of cooperatives

in management & organization, and support cooperatives to get loans, particularly for marketing

activities.

12. Training. After the DUs have received the equipment, cooperative members will be trained

in commodity processing in order to train other SMEs (cooperatives or individuals) during

demonstration sessions. Training manuals are being finalized by the cassava and fruits value chain

adviser. A training manual in Kinyarwanda will be distributed to all participants. The initial training

will deal with the technical aspect of respective commodities processing, the basic concepts of

hygiene and sanitation in food processing, concepts of standards and quality, good manufacturing

practices, and the basic management. The subsequent training would include the production

of packaged products. A training session will last 5 days. The project will pay the cost up to 90%

whereas beneficiaries will pay 10%.

13. Production trials. Trainings will be conducted during production trials aimed at testing the

quality of equipment received. Non performing equipment should be replaced by the supplier.

UNIDO experts should be involved in the elaborate testing of the equipment, particularly for cassava

and maracuja.

14. Selection of SMEs to be trained. Criteria should be well defined before selecting individual

MER and cooperatives that will attend demonstration sessions. Motivation to be trained and capacity

to acquire similar equipment should be taken into consideration in this process. It is anticipated that

around 20 people will be trained per demonstration session.

5 COVAFGA: 10% or Rwf 39,000. PPPMER: 90% or Rwf 351,000.


Follow-up Report

33

15. Demonstrations. People close to the DUs and interested by their processing activities will

be identified in collaboration with local authorities. Demonstration sessions will be regularly

organized using the premises of the DUs. One demonstration session will take 5 days and a

maximum of 20 persons. A training manual in Kinyarwanda will be given to each participant.

Beneficiaries will participate up to 10% in the costs. Trainees will be encouraged to apply for loans

(including project-finance loans through the participating financial institutions) and to replicate the

model of the DU: equipment, organization, management. In particular, loans to get appropriate

packaging are needed for marketing purposes, for both cooperatives hosting DUs and trainees.

16. Business plans. Cooperatives hosting DUs will be retrained in management and organization

before being involved in the preparation/updating of their business plans. This will result in preparing

a work plan for each DU. Monthly reports on the DU progress will also be prepared by each

cooperative.

D. Recommendations

17. Given the delays experienced to make DUs operational, the main recommendation is to

implement the attached schedule of activities per DU. This schedule was agreed upon with the

cassava and fruit value chains adviser. The May 2012 follow-up mission should assess the progress

in implementing these activities. Other recommendations include:

Districts to support COPEBUGA and URUGANGAZI in getting water supply;

MINICOM to restore the roof structure of NYEGANYEGA;

MINICOM to complete cassava fermentation tanks and drying beds for COPEBUGA and

NYEGANYEGA;

Start production, training and demonstration activities in CATM and KIAI DUs, while

waiting for remaining works in the 3 dysfunctional DUs to be completed with the support of

MINICOM and the districts;

Sign MOUs with all cooperatives hosting DUs;

Cooperatives to prepare monthly reports on the progress of DUs;

UNIDO to be involved in the equipment inspection during the elaborate testing;

Organize management refresher courses for key staff of cooperatives hosting DUs;

Prepare/update business plans of all DUs and prepare work plans accordingly;

Clarify ownership status of buildings hosting DUs constructed by the Government; and

Assist DUs and trainees to access to loans, particularly for marketing activities, including

packaging.

34

Attachment 1: Schedule of planned activities6

CATM Cassava DU

Activities and sub

activities

2011 2012 2013

Expected outcomes M J J A S O N D J F M A M J J A S O N D J F M A M J

Installation solar dryer Solar dryer installed

Training operators Operators trained for one week

Production trial Production follow-up

Census of interested

Coops/individuals to be

trained

10-20 Coops/individuals to be trained

are identified

Organization of demonstration sessions

10-20 Coops/individuals are trained

Writing/updating business

plan

The business plan for the cooperative is

available

Writing action plan

The action plan for the cooperative is

available

Assistance in loan access

Needs are identified and loan application is submitted

KIAI Cassava DU

Activities and sub activities

2011 2012 2013






Coops/individuals to be

trained

10-20 Coops/individuals to be trained are

identified



Writing/updating business

plan


available

Writing action plan


available



6 The schedule may change due to delayed equipment supply or delayed installation of water for URUGANGAZI and KOPEBUGA

RW

AN

DA

: Ru

ral Sm

all and

Micro

En

terprise P

rom

otio

n P

roject (P

PP

ME

R-II)

Follo

w-u

p R

eport

35

NYEGANYEGA Cassava DU


2011 2012 2013






Coops/individuals to be trained


are identified



Writing/updating business plan


available

Writing action plan


available



URUGANGAZI Cassava DU


2011 2012 2013








identified





available

Writing action plan The action plan for the cooperative is available


Needs are identified and loan application is

submitted

RW

AN

DA

: Ru

ral Sm

all and

Micro

En

terprise P

rom

otio

n P

roject (P

PP

ME

R-II)

Follo

w-u

p R

eport

36

COPEBUGA Cassava DU


2011 2012 2013


Installation solar dryer

The dryer is installed

Training operators Operators are trained





identified

Organization of demonstration

sessions




available

Writing action plan

The action plan for the cooperative is available



submitted

COVAFGA Maracuja DU


2011 2012 2013


Installation Equipment

The equipment is installed

Training operators

Operators are trained





identified


sessions



The business plan for the cooperative is available

Writing action plan

The action plan for the cooperative is available



RW

AN

DA

: Ru

ral Sm

all and

Micro

En

terprise P

rom

otio

n P

roject (P

PP

ME

R-II)

Follo

w-u

p R

eport

37

UNICOAPIGI Honey DU


2011 2012 2013






identified


sessions






submitted

CAR Honey DU


2011 2012 2013






are identified




The business plan for the cooperative

is available


Needs are identified and loan

application is submitted

RW

AN

DA

: Ru

ral Sm

all and

Micro

En

terprise P

rom

otio

n P

roject (P

PP

ME

R-II)

Follo

w-u

p R

eport

38

UNICOOPAV Honey DU


2011 2012 2013



Census of interested Coops/individuals to

be trained

10-20 Coops/individuals to be trained are identified






Needs are identified and loan application

is submitted

KOPAKI Honey DU


2011 2012 2013




Census of interested Coops/individuals to be trained


identified







RW

AN

DA

: Ru

ral Sm

all and

Micro

En

terprise P

rom

otio

n P

roject (P

PP

ME

R-II)

Follo

w-u

p R

eport


Follow-up Report

39

APPENDIX 2: APPRENTICESHIP SUPPORT

A. Introduction

1. This Appendix reviews the progress made by the project under the rural apprenticeship

training and makes practical recommendations in its support. It provides more details on the

implementation status of the apprenticeship training. The mission visited apprentices who were being

trained in Gakenke and Rulindo districts and post-graduate apprentices who already practice trades in

Gakenke and Musanze districts. In carrying out its tasks, the mission worked in close consultation

with the SPIU staff, districts staff, former CERs and FEs, and master trainers (trainers of apprentices,

formerly called PPs following the French acronym).

B. PPPMER apprenticeship approach

2. The project apprenticeship training approach is unique in Rwanda. It is practical and designed

to reach a large number of beneficiaries in the shortest time possible (usually 6 months). It also

ensures that apprentices get a basic knowledge to enable graduates to practice their newly acquired

skills. PPPMER apprenticeship training approach is a process consisting of targeting the trainees,

choice of training courses, master trainer selection and contracting, training follow-up, post-

apprenticeship trainings, support to finance access for business start-up.

3. Targeting the trainees. The apprenticeship training programme targets rural youth who

abandoned school for vulnerability reasons. The priority is thus given to orphans, child headed

households and young people from very poor families. Annually, local authorities at sector level send

a list of apprenticeship candidates to the project for consideration. These candidates are then

interviewed by the FEs and CERs (in the future this will be done by PROBAs) to verify if they are

effectively part of the project target group. To benefit from the training programme, candidates have

to meet pre-defined criteria including: i) being a resident in the area of the project intervention;

ii) holding a certificate of vulnerability issued by the local authority; iii) having a primary school

level; iv) having no other commitment for the duration of training; v) passing an entry test; etc.

4. Choice of training courses. The project approach is to let beneficiaries decide themselves the

training to attend, based on their interests. Overall, the choice of training topics prioritizes trades with

a relatively big potential of profitability and market in rural areas. From the experience of the last

seven years, tailoring and carpentry trades are the most attended by apprentices (an average of 57%

and 20% of the total apprentices respectively). Standardized training curricula for the seven most

popular courses in the apprenticeship programme (tailoring, carpentry, mechanics, electricity,

miscellaneous repairs, footwear and fine craftsmanship) were established in collaboration with the

Kicukiro Training Center (KTC) of WDA.

5. Trainers selection and contracting. The trainers are selected by the project‟s technical staff

in the field (CERs and FEs), based on predefined criteria including: i) having a work space and

adequate furniture to perform the training; ii) having appropriate equipment, materials and tools;

iii) having an acceptable level of technical skills in the trade; iv) having a trained and experienced

team, consisting of at least 2 to 3 persons; v) motivation to provide training to apprentices;

vi) signing a contract with the project agreeing to all its terms and conditions, etc. The trainers are

rural practitioners in the given trade, close to apprenticeship programme beneficiaries.

6. Training modalities and schedule. Except for training that requires a longer period

(12 months), i.e. auto mechanics, the duration of the training is usually 6 months. Three types of

training courses are adopted by PPPMER as follows:


Follow-up Report

40

Home-based training: Beneficiaries attend the training on weekdays at the area of their

residence and return home in the evening. This cheap training attracts a large number of

apprentices, particularly orphans and child-headed households members;

Learning outside the place of residence: In few cases, trainees are obliged to follow the

training outside their residence. This is the case when trainees are interested in learning a job

with high potential of profitability, but with no skilled trainers available locally. This training

is more expensive than the first one, and the number of apprentices is much more smaller;

Long-term training: Unlike the first two training types, this training is not provided by the

master trainers, but is done in collaboration with specialized institutions, such as Centres de

formation professionnelle des jeunes (CFJ). The beneficiaries stay at the training institutions

for the duration of the training. The long-term training was introduced in 2009 after the Mid-

Term Review.

7. Training follow-up. The project approach foresees a follow-up of the apprenticeship training

programme at least every two weeks, by FEs and CERs. The progress of the programme is reviewed

and a monthly report prepared on achievements based on the training plan. In addition, CERs and

FEs are expected to prepare jointly with PPs mid-term and final evaluations of apprentices to assess

the level attained by each trainee, on the basis of the quality of the product delivered during these

evaluations.

8. Post-apprenticeship trainings. Graduate apprentices acquire other skills in addition to

vocational training. These skills, mainly focused on management, are crucial for new apprentices

who decide to start a business. The following courses are offered: i) management and bookkeeping;

ii) loan application and management of funds; iii) trade policy and entrepreneurship; and iv)

cooperative management.

9. Access to finance. As mentioned above, most apprentices are selected for the training

programme because of their vulnerability. Therefore, these young people cannot afford the basic

equipment required to start their own businesses, at the end of the training. To address these

problems, the apprentices are organized into groups for mutual support, and PPPMER facilitates the

acquisition of equipments through micro finance institutions, with a 50% subsidy. It should be noted

that each apprentice receives RWF 18,000 at the end of the training (equivalent of RWF 3,000 per

month). This amount allows most of apprentices to pay their membership participation to

cooperatives.

C. Achievements to date

10. Apprenticeship training implementation is on track. So far, 8 546 youth (56% of women) have

completed their 6 to 12-month training by rural micro-enterprises in 31 different trades under

PPPMER II, as shown in the table below. If we take into consideration 2 034 apprentices trained

under PPPMER I, the project has contributed to train 10 580 apprentices under PPPMER I and

PPPMER II, as of 30 June 2011. As above mentioned, tailoring and carpentry are the most popular

trades, with 77% of the total number of apprentices trained. Out of 31 trades, 7 are attended by

around 95% of apprentices. These include tailoring, carpentry, hair dressing, repairs, welding, basket

weaving and auto mechanics. From the table below, it is clear that some trades (tailoring, basket

weaving) are mainly women trades whereas other trades (carpentry, welding, mechanics, repairs) are

mostly undertaken by men.

11. To date, long-term training was attended by 320 trainees (see table below) in the following

trades: mechanics, hotel industry (hotellerie), pottery, knitting, construction, carpentry, and

electricity. Women represent only 28% of the total number of youth undertaking long-term training.

This is due to the fact that the most popular long-term training (mechanics) which represents around

50% of the apprentices is almost exclusively attended by men. The same case applies for carpentry

and construction. Long-term trainings mostly attended by women include hotel industry, pottery and

knitting. Electricity training is attended by 50% of men and 50% of women.


Follow-up Report

41

12. To date, post-apprenticeship support provided under PPPMER II includes: i) 4 038 graduate

apprentices trained in management and bookkeeping, 2 339 in project preparation and management

of funds, 2 831 in trade policy and entrepreneurship, 1 586 in cooperative formation and

management, and 1 756 supported in acquiring accumulated credit of leasing equipments.

Table 1: Short-term apprentices trained by PPPMER II (from July 2004 to June 2011)

Activity

Year

2004

Year

2005 Year 2006 Year 2007 Year 2008 Y 2009/10 Y 2010/11 Total %

F M F M F M F M F M F M F M F M Tot

Tailoring 95 543 76 912 203 237 44 425 55 916 102 941 284 4069 764 4833 56,55%

Carpentry - 90 4 253 34 343 6 135 1 171 1 274 11 371 57 1637 1694 19,82%

Hair dressing - - 29 36 62 61 16 25 33 23 65 44 52 49 257 238 495 5,79%

Repairs - - - 88 3 131 - 42 - 35 - 24 - 53 3 373 376 4,40%

Welding - - - 33 5 61 3 21 1 17 2 70 - 128 11 330 341 3,99%

Tannery - - - 3 1 1 - 5 - 6 - - - 1 15 16 0,19%

Construction - - - - - 13 - 4 - 8 1 16 3 5 4 46 50 0,59%

Leather works 12 7 9 - 2 1 5 1 6 - 8 9 42 51 0,60%

Sweater weaving - - 8 4 19 - 9 - 7 2 19 1 - - 62 7 69 0,81%

Kitchen - - - - - - - 4 1 0 0 - - 4 1 5 0,06%

Basket weaving - - 60 - 60 14 22 8 6 1 16 0 17 19 181 42 223 2,61%

Auto mechanics - - - 4 - - - - - - 1 87 2 61 3 152 155 1,81%

Sculpture - - - 1 - - - - - - - 7 - 5 - 13 13 0,15%

Iron works - - - - - - - - - - - 2 - - - 2 2 0,02%

Hotel industry - - - - - - - - - - 26 7 - - 26 7 33 0,39%

Electronics - - - 6 - - - - - - - - - 6 - 12 12 0,14%

Pastry - - 1 4 1 1 - - - - 4 2 - - 6 7 13 0,15%

Electricity - - - c - - - - - - 11 26 - 2 11 28 39 0,46%

Pottery - - - - - - - 2 - 3 10 - 1 3 11 8 19 0,22%

Artworks - - - 6 2 - - 3 - - - - - - 2 9 11 0,13%

Embroidery - - 6 - - - 1 - - - - - - - 7 - 7 0,08%

Processing - - 4 6 3 5 3 - - - - - - 1 10 12 22 0,26%

Forging - - - 6 - 2 - - - - - - - 2 - 10 10 0,12%

Batik - - 2 - 1 1 - - - - - - - - 3 1 4 0,05%

Bakery - - 2 5 4 2 - - - - - - 3 - 9 7 16 0,19%

Cheese Making - - - - - 2 - - - - - - - - - 2 2 0,02%

Soap Making - - 4 3 - - - - - - - - - - 4 3 7 0,08%

Ceramics - - 1 2 - - - - - - - - - - 1 2 3 0,04%

Beekeeping - - - 1 - - - - - - - - - - - 1 1 0,01%

Imigongo - - 1 - 8 - - - - - - - - - 9 - 9 0,11%

Tapestry - - 7 - 4 4 - - - - - - - - 11 4 15 0,18%

Total 95 90 672 549 1126 853 297 291 478 327 1073 668 1030 997 4771 3775 8546 100,00%

% (F&M) 51% 49% 55% 45% 57% 43% 51% 49% 59% 41% 62% 38% 51% 49% 56% 44% 100%

Source: PCU (M&E unit)

Table 2: Long-term apprentices trained by PPPMER II (from January 2009 to June 2011)

Trade Year 2009 Year 2010/11 Year 2011/12 Total

Women Men Total Women Men Total Women Men Total Women Men Total

Mechanics 1 55 56 1 92 93 - - - 2 147 149

Hotel industry 23 9 32 26 10 36 - - - 49 19 68

Pottery - - - 10 - 10 - - - 10 - 10

Knitting - - - 12 - 12 - - - 12 - 12

Construction 1 - 1 1 - 1 - 27 27 2 27 29

Carpentry 1 - 1 1 - 1 - 24 24 2 24 26

Electricity 2 - 2 11 13 24 - - - 13 13 26

Total 28 64 92 62 115 177 - 51 51 90 230 320

Source: PCU (M&E unit)

13. A survey realized in the period 2006-2008 on the apprenticeship programme indicates that the

PPPMER II has significantly contributed to job creation and reduced unemployment rates in rural

areas. This resulted in an improvement of the livelihoods of beneficiaries. Out of the total number of

graduate apprentices, 81% had a permanent job, either in their own businesses (36%), or as


Follow-up Report

42

employees in other enterprises (45%), 2% decided to continue the secondary school, 8% were

unemployed, and 9% changed their activities and migrated outside their residence.

D. Apprenticeship training during the extension period

14. The 2-year extension period of PPPMER II started in July 2011. Based on the previous

apprenticeship success, “the extension would serve to develop a government-driven apprenticeship

system, with a view to diversifying the participating trades, linking apprentices to BDS Centres for

apprenticeship training, and possibly a fund for business start-up finance. The system would be

implemented by RDB in collaboration with district authorities and the Workforce Development

Authority”. Main activities foreseen in apprenticeship training during the extension period include: i)

home-based training of 9 500 apprentices (3 500 in year 1 and 6 000 in year 2); training of 280

apprentices outside their residence (140 in year 1 and 140 in year 2); iii) long-term training of 160

apprentices (80 in year 1 and 80 in year 2); and iv) post-apprenticeship training in management and

bookkeeping (2 500 in year 1 and 5 000 in year 2), in trade policy and entrepreneurship (2 500 in

year 1 and 5 000 in year 2), and in project preparation and management of funds (2 500 in year 1 and

5 000 in year 2).

15. Despite previous agreements, the rural apprenticeship training programme, still implemented

directly by the PU, has not yet been integrated in a partner agency. BDS centres are in the process of

privatization with the support of RDB. The latter confirmed that it will not be involved in the

apprenticeship training programme as foreseen by the extension mission. In addition, the mission

found out that all activities related to apprenticeships were not yet transferred to WDA. In the

absence of a partner agency, the apprenticeship training was implemented directly by the project in

year 2011/12, with 1 500 apprenticeships (63% of women) ongoing and 2 000 apprentices in the

process of identification to start in November 2011. Apprenticeship training manuals related to the

7 above mentioned main trades were prepared by KTC/WDA and distributed to 445 participating

training enterprises.

16. Key constraints currently experienced by the apprenticeship programme include training

follow-up, which is not satisfactory at the moment since CERs are overloaded by work in their new

mandate and FEs are no more on board. This will affect the quality of ongoing training if corrective

measures are not taken. FEs used to monitor apprenticeship training at least once in two weeks; this

was followed by a monthly report prepared by CERs on the apprenticeship progress with regard to

action plans agreed upon with the PPs. This is no more feasible for the above mentioned reasons. In

addition, most post-apprenticeship training activities for the 2 027 apprentices graduated in February

and March 2011 are not yet done.

E. Next steps

17. The integration of the apprenticeship training programme in a partner agency is a high priority

to make the programme operational in a sustainable way. During the mission, the Workforce

Development Authority (WDA) expressed its strong interest in working in partnership with the SPIU

to implement the apprenticeship programme. To develop the partnership between the SPIU and

WDA, the following actions were agreed upon:

a) The SPIU to share key project documents (extension design, follow-up and implementation

support reports, apprenticeships strategy, etc.) by 30 October 2011;

b) The SPIU to prepare a concept note on modalities of collaboration with WDA, to be discussed

and finalized by 15 November;

c) WDA to prepare an outline of the apprenticeship programme document (including the planned

accreditation of participating training enterprises and the certification of apprentices,

differentiation between new and experienced apprentices, follow-up by PROBAs to be


Follow-up Report

43

contracted directly by WDA, possibly selected and supervised by its vocational training centres -

VTCs) by 15 December;

d) The SPIU to prepare an MOU with WDA based on the above document, to be signed by

15 January with a view to take over the implementation from the SPIU immediately thereafter;

and

e) WDA to contract PROBAs for apprenticeship follow-up using the voucher system and provide

graduate apprentices with vouchers for post-apprenticeship training.

F. Recommendations

18. The next steps above mentioned constitute a road map that should be implemented on time to

effectively transfer activities related to apprenticeships to WDA. Thus, the main mission

recommendation is for the SPIU and WDA to comply with the above described road map. The

contract signed between RCA and CERs allows the latter to make occasionally a follow-up of

PPPMER activities including apprenticeships. Moreover, FEs also monitor from time to time the

progress of the apprenticeship training on a voluntary basis. This arrangement should be pursued

while waiting for the PROBA Scheme to become operational and the MOU with WDA to be

effective. If for any reason this MOU experiences delays in its signature, then the SPIU should

contract directly PROBAs through the voucher system in order to avoid any shortcoming regarding

the quality of apprenticeships.

19. It should be reminded that during the extension period, the financing rule for the

apprenticeship was foreseen as follows: 50% of the total cost for IFAD, 40% for the Government,

and 10% for the beneficiaries. This was not the case for the current financial year which is the first

year of extension. It should be however be strictly applied for the second year of extension (2012-

2013 AWPB). The 2012/13 AWPB of the MSME Development Project, funded by government and

implemented by the SPIU, which includes support to apprenticeship, should thus be prepared

accordingly.


Follow-up Report

44

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APPENDIX 3: RURAL SME DEVELOPMENT

I. Business Advisory Services for Rural Microenterprise Development

A. Proximity Business Advisory (PROBA) Scheme

Introduction and objectives

1. The SME Policy objective 2 aims at facilitating SMEs

7 access to business development

services. For the rural microenterprise development in Rwanda, there is a sound need for business

development services by a very large number of rural microenterprises, which together with agriculture

constitute the basis of the currently weak rural economy.

2. In response to this unfulfilled need and consistent with the SME Policy, it was observed that

while no central level agency is oriented towards filling this gap, the districts and sectors are well

placed and mandated to facilitate such services. Furthermore, recognizing that some of RSMEs are not

capable to pay business advisory services, and the capacity constraints in local government and

MINICOM‟s intentions of building demand-driven services, service provision by small-scale

businesses in rural areas initially supported through a voucher system presents itself as the system of

choice. In this regard, MINICOM has decided to initiate the Proximity Business Advisory (PROBA)

Scheme through its Single Project Implementation Unit (SPIU) and in partnership with the districts.

Schematic diagram of the PROBA scheme

7In this policy, SME is used to describe micro as well as small and medium enterprises

SPIU

RSME

Facilitator

Rural and Micro

Enterprises

BDC, BDS,

Proximity Business

Advisors

Serv

ices

Vo

uch

ers

District Contract

Propose voucher recipients

District PROBAS

Committee

Sector

SACCO


Follow-up Report

45

PROBA Scheme target group

3. Most generally, the PROBA Scheme aims at getting two actors together: (i) the PROBA

(Proximity Business Advisor) and (ii) the RSME (Rural Small and Micro Enterprise, both individual

enterprises and cooperatives). PROBAs will be small-scale rural entrepreneurs who offer part-time

advice to RSMEs. Through the scheme, the RSME will get business advisory services from the

PROBA of his or her choice. The services will be subsidized through a voucher system.

PROBA Services

4. PROBAs will offer the following services:

Training and coaching in business management e.g. accounting and bookkeeping, taxation,

start-up business management, business plan writing, entrepreneurship, cash management,

use of financial services, and marketing;

Business counseling for RSMEs in districts; and

Technical training depending on the specialization of the PROBA.

PROBA Scheme principles

5. The guiding princples of the PROBA Scheme will be:

Demand-driven: This aims at addressing true needs of the RSMEs based on their own

judgment. The culture of external identification of trainees and their training needs, and

receiving services free of charge will be replaced by the one of the RSME identifying itself a

suitable service provider (that is, the PROBA) and the service required, and negotiate and

pay demanded and delivered services directly.

Negotiation: The RSMEs will be able to negotiate themselves the needed services with a

service provider (PROBA) and exercise independent choice.

Cost based on quality of service: Quality control becomes and remains the responsibility of

the RSMEs. This will ensure a high quality of services rendered to RSMEs.

Feedback. The PROBA will fill in basic information on the service delivered on the back of

the vouchers.

6. The District PROBA Committee will be composed of 6 members: district Vice-mayor in

charge of economic affairs, district Executive Secretary (as district budget manager), RSMEs

facilitator (acting as the committee‟s secretary, non-voting), District Cooperative Officer, one sector

Executive Secretary and one RSME representative, nominated by the local business community in

the district. It will be responsible for:

Approving the PROBA accreditation proposed by RSME Facilitator;

Approving eligible RSMEs voucher recipients proposed by the sectors; and

Evaluating monthly the evolution of the PROBA Scheme and provide guidance to the RSME

Facilitator and the sector administrations.

7. An RSME Facilitator will be hired by each district level on a contract basis. Reporting to the

District Vice-mayor for Economic Affairs, each RSME Facilitator will be responsible for:

a) Establishing the District PROBA Committee and acting as its secretary (to call for

and prepare meetings, information notes, minutes, etc.);

b) Ensure sound general awareness and understanding of the PROBA Scheme in the

district, including the sectors (through publicity campaigns, etc.);

c) Arranging for a call for expressions of interest by operators of well-functioning rural

businesses to become PROBAs;


Follow-up Report

46

d) On an annual basis, assessing the suitability of the applicant RSME operators and

accrediting them as PROBAs (starting with the former formateurs d’entreprise-FEs);

e) Submitting PROBAs for final accreditation to the District PROBA Committee;

f) Constantly up-dating and making accessible to RSMEs the list of accredited

PROBAs in the district, with contacts and specialization in service provision;

g) Guiding the district and sector administration in selecting the RSMEs that are

eligible for buying vouchers;

h) Establishing with the Sector SACCOs the modalities for selling vouchers to eligible

RSMEs, and for buying filled-in vouchers from PROBAs who received these in

payment for services;

i) Investigating any allegations of fraud regarding the voucher system;

j) Maintaining the district database on vouchers distributed and returned, including the

details from the returned vouchers;

k) Providing short monthly analyses to the District PROBA Committee of the

functioning of the PROBAs Scheme on the basis of the district database; and

l) Maintaining links to the SPIU and other RSME Facilitators on the development and

implementation of the PROBAs Scheme, with a view to improving its performance.

8. Payments. All voucher payment processes will be done through Umurenge SACCO: the sale

of the vouchers to eligible SMEs, and the redemption of the vouchers by the PROBAs. Every month,

the participating SACCOs will submit a report of transactions (vouchers sold, vouchers redeemed)

together with an invoice for the services and, of course, the original vouchers redeemed. The SACCO

will receive a commission for this service, with a simple structure easy to administer. It is suggested

that for every voucher redeemed a commission of initially RWF 100 be levied by the SACCO,

payable by the district upon presentation of the report and original vouchers. At the same time, the

balance between the voucher sales price (initially RWF 500) and the voucher redemption value

(initially RWF 5 000) will be paid by the district to the SACCO. The voucher payment services by

the SACCOs will also be included in the MOUs between the SPIU and the districts (see below),

including the nature of transactions, reports and commissions.

9. The SPIU, MINICOM, is the promoter of this new and innovative scheme for rural

business growth and development in Rwanda. The SPIU will finance the PROBA Scheme by

providing salaries and performance incentives for RSME Facilitators, design and print vouchers,

provide subsidies for vouchers, commissions for SACCO services, and running costs for the District

PROBA committee. In addition, it will have the overall responsibility for implementation,

supervision and the success of this new model.

10. The SPIU will draft a standard MOU for the support to the PROBA Scheme, and sign it

with each district. In the MOU, key operational elements such as the district oversight function to be

exercised through the District PROBA Committee, the contracting of the RSME Facilitator and the

quarterly physical and financial reporting by the district will be detailed. The voucher payment

services by the SACCOs will be detailed, and the participating SACCOs will countersign the MOU.

Also, an Annual Addendum to the MOU will specify the annual budget to be transferred to the

district for this purpose, and the annual targets against which the district will report.

Implementation arrangements and timeline

11. The SPIU will prepare the MOUs to be signed with all district authorities before December

2011 to see the system operational in all 30 districts by January 2012. Upon signature, the SPIU will

transfer the current cooperative coaches (former CERs) from RCA to the districts to work as RSME

Facilitators. This activity shall be completed end-December 2011.


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47

B. Setting up a Voucher System

12. PPPMER has already budgeted in its AWPB 2011/2012 an envelope of Rwf 150 million to

be shared among 30 districts for voucher system implementation. According to this plan, eligible

RSMEs will benefit support from PPPMER through a voucher system in respect of specific needed

services.

13. Setting up a voucher system is one way to develop the PROBA market to contribute to SME

Policy objectives on a commercially profitable basis of business services delivery. The

implementation of this new and innovative system will target microenterprises that cannot finance

business advisory services themselves.

14. This scheme brings significant changes in business advisory services functioning. In fact,

with the vouchers, eligible RSMEs (both individual enterprise and cooperative) will be able to contract

themselves the services of a nearby PROBA on a 1-to-1 basis. A PROBA list will be regularly updated

by the RSME Facilitator. This way, the RSME becomes the client buying the services it needs from

who can offer it at the best cost/quality ratio.

15. In collaboration with the sectors, the RSME Facilitator will develop a list of eligible SMEs in

the district. Depending on need, an SME may be identified as needing 2 or more vouchers, which

would be issued one-by-one. The eligible business would be informed of its voucher entitlement, and

receive a list of accredited PROBAs in the district, with their specialization. They will then be able to

purchase the voucher from the Umurenge SACCO at the sales price of RWF 500. The vouchers

would have a face value of RWF 5 000, buying about 4 to 8 hours of service (this needs to be

negotiated between the SME and the PROBA). Drafts of models for the vouchers are presented in

Attachment 1 below.

16. Upon completion of the service, the SME would pay the PROBA with the voucher. The

PROBA would enter the details of the services rendered and some basic data on the client SME on

the voucher, certify that services were provided (with the RSME countersigning) and present it at the

Umurenge SACCO for payment. No other prior or external additional test or verification of service

completed would be required for payment. Yet with his signature on the redeemed voucher, the

PROBA would vouch for the services actually rendered. The payment will be made directly to the

PROBA.

17. The redeemed vouchers will be presented to the district. The RSME Facilitator will then fill in

the information on the back of the vouchers in the PROBA service database, which will inform the

district and the SPIU about the functioning of the system, its outreach and what kind of services are

most in demand. This will be useful for making adjustments to the system, and also to plan appropriate

training courses for the PROBAs.

18. This system will also strengthen and value Umurenge SACCO. For this purpose the districts

will contract Umurenge SACCO to service PROBAs and in return, the SACCO will get agreed

commission on service rendered under PROBAS. This commission shall be negotiated as a fixed fee

per completed voucher redeemed at the SACCO. It is suggested that this commission be set at RWF

200.

C. Training for PROBAs

19. The PROBA Scheme would be set up immediately, with an effective start date of 1 January

2012, with intensive sensitisation campaigns launched before that date. To ensure gender

responsiveness in the system, the campaign messages should be packaged in a way that gives rural poor

women and men confidence to seek for the business advisory services. Initially, the 211 former FEs


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48

will be accredited, immediately followed by the mobilisation of more PROBAs, aiming at 2-3 PROBAs

per sector.

20. The initial PROBAs will be the proximity advisors (FEs) already working with PPPMER,

mainly in the provision of technical and managerial training and coaching to SMEs. As such, these

initial PROBAs can start working immediately after their familiarisation with the PROBA Scheme.

21. All new PROBAs (and eventually also the initial PROBAs) will require training to provide

quality services, mainly in business management and coaching. For this, the project will build on the

PCU‟s request to the International Labour Organization (ILO) to utilize its SIYB (Start and Improve

Your Business) modules to enhance technical skills of the PROBAs. ILO proposes 4 modules to

reinforce capacities of PROBAs. The modules include:

(i) generate your business (GYB) intended for people without a business plan who

would like to start a business. At the end of the training, participants are expected to

have developed a concrete business idea ready for implementation;

(ii) Start your business (SYB): This is a materials based training program for potential

entrepreneurs with a business idea, who want to proceed and start their own business.

The programme is a combination of training, field work, and after training, SYB

Awareness and SYB planning;

(iii) Improve your business (IYB). This introduces practicing entrepreneurs to good

principles of business management, i.e. marketing, costing, stock control, record

keeping, buying and business planning, relevant examples and exercises enable

entrepreneurs to identify their own business problems and actively engage in solving

them and

(iv) Expand your business (EYB). This gives growth – oriented small and Medium

entrepreneurs the practical tools to implement and realize fast business growth and

profits. SPIU have not matured the partnership with ILO, to provide the electronic

entrepreneurship modules to PPMER for the PROBAs.

22. The SPIU should put in efforts to mature partnership agreement with ILO to access their

modules. The training of the existing 212 PROBAs will be supported by the SPIU and UNIDO in the

framework of the One UN funded project on Livestock Resource Value Chain Development. The SPIU

will be responsible for preparing the training, and catering for all logistical expenses including rental

charges for the training hall, catering services, transport allowances, training materials and many more

as required. UNIDO will provide the trainer (s). These trainings will be split into 3 classes (each group

of at least 74 PROBAs). Each training will take a maximum of 15 days. The planned trainings will to

take place before the end of March 2012.

D. Support to Marketing Skills

23. Marketing is one of the key roles and at the same time one of the key constraints of

cooperatives, where proactive behavior is especially important. The mission notes that many

cooperative leaders rely to a large extend on the support from their coaches (CER). They expect for

instance that CER identify potential market opportunities and buyers and link them up and even

negotiate for them. Market changes are often ignored and in many cases cooperative leaders don‟t find

solutions to cope with negative trends.

24. The case of UCOPROARU: Some 3 handicraft cooperatives in Rulindo district organized in

the recently created union UCOPROARU have collaborated several years with the export-oriented

handicraft company Gahaya Links, which mainly operates in the US market. In 2008, the company has

bought the entire basket production of these cooperatives, which expanded rapidly in order to cope with

an expected increasing demand. According to the union president, Gahaya Links changed its marketing

strategy in the following years and shifted its focus from these baskets to other products. The


Follow-up Report

49

cooperative turnover dropped from RWF 12 million in 2008 to RWF 0.6 million in 2010, which

corresponds with a production period of 2 weeks.

25. 2 years after the cutback the cooperative and union leaders have not yet been able to respond to

the changed market demand. It appears that no significant attempt has been done to systematically

search alternative buyers or to adapt the production (e.g. design) to the changed market demand.

Instead, the leaders expressed their expectation that the Project would take action in linking them up to

other buyers.

Context-specific marketing skills and self-reliance

26. The example shows that these cooperatives are far from being self-reliant and from having

sufficient marketing skills for continued success. It also shows that there is need to adapt the marketing

support strategy for strengthening long-term marketing conditions for RSMEs and cooperatives,

including the need to build pro-activeness in the cooperatives‟ search for markets, clients and the best

products to offer.

27. Marketing support should emphasize training and coaching targeting the development of

context-relevant skills. This means that they can be applied under the given conditions of the targeted

RSME‟s and cooperatives, which are typically characterized by a low level of funds, market

information and by long distances to the target markets.

Marketing coaching by local experts – building up PROBAs expertise in marketing

28. Local marketers, who successfully operate under the same or similar conditions for

example as cooperative managers or entrepreneurs, can play an important role as marketing

coaches. The project should try to make use of and disseminate these skills among the beneficiaries

through the PROBA (Proximity Business Advisors) system currently under development. How ?

The identified marketing experts can either act as PROBAs (which means that they have to be

accredited and supported in the PROBA Scheme) and/or eventually – if the SPIU sees enough

potential – as trainers of other PROBAs. Two specific activities are recommended in this regard:

a) It is suggested that the RSME Facilitators be particularly on the look-out for potential

marketing coaches in the process identifying the additional PROBAs.

b) In addition, an expert workshop facilitated by the project, in which a training and

coaching module will be developed, can produce useful guidelines for marketing

advisory services. These guidelines would take into account the highly participative

and context-specific market support services to be delivered by the PROBAs. The

guidelines should emphasize amongst others:

Organizing market research and monitoring under rural conditions (e.g. high

transport costs and little funds). Among the potential subjects: how to organize

market prospection missions and committees which involve several cooperatives,

unions and RSMEs.

Accessing and managing market information (without Project support!),

including prices, supplier & buyers contacts, new products, markets, trade fairs,

exhibitions.

Improving visibility and communication (e.g. stands and signboards, strategic

positions, key contact management)

New market niches by innovating: suggesting new and innovative products is an

important marketing element, especially in the handicraft and tailoring sectors.

Copying leads to market saturation, new and improved products are the basis for

long-term success. This has to come from the entrepreneurs, which shouldn‟t rely

on Project support. Cooperatives could create product development committees,


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50

which might test a few new products and/or marketing avenues, and which would

need to be compensated by the cooperative (e.g. compensation for time spent and

raw materials used).

II. Technical Assistance for Masaka Business Incubation Centre (MBIC)

29. RDB has established the Masaka Business Incubation Center (MBIC) to demonstrate

appropriate technologies and provide technical business development services. Of the 12 planned

Business Incubation Centers, so far only MBIC is set up. The centre aims at enabling public and

private Micro, Small and Medium Enterprises. It offers technical business management services with

the opportunity of hands-on, vocational training, coaching and incubation services. The centre is

comprised of four processing units: bamboo, cheese, fruit, and leather goods.

30. It is financed by RDB and other development partners (UNIDO, Chinese Embassy and

IFAD through PPPMER). It is managed by RDB. The management structure is comprised of a

CEO, a Head of Trade & Manufacturing Department, a Centre Manager and Head of technical

unit respectively.

31. Masaka business incubation centre is not fully operational yet With the exception of

leather unit, the other units are not operational at the moment. However, there is a lot going on-

the remaining cheese equipments & utilities have been tendered for; Indian and Kenyan

companies have been contracted to install the equipment for fruit and cheese processing,

respectively. Bamboo, cheese and fruit units are expected to be fully operational by end of 2011

and Thus the center will be completely operational by Jan 2012. The same companies are

contracted to train RDB staff.

32. The mission noted that RDB has not yet employed its own technician(s) for any of the

units. It is rather worrying as to who will be trained on the side of RDB by the contracted

companies. Therefore, it is highly recommended that, RDB should employee Unit technician (s)

who could befit from TA as early as possible so that, the bamboo, cheese, fruit and leather

experts could train them from onset.

33. Under the expired project MOU with RDB to finance fruit processing equipment, the BIC

was to train 100 persons in fruit processing in 2011/12. To conclude the activity, it was agreed to

extend the duration of the MOU until end-2012, and that RDB hire a fruit processing trainer to be

coached by the available technical assistance.

34. Moreover, it was noted that no business strategy for the Centre was in place, and that plans

for weaning entrepreneurs from its services were notional. Such business strategy should include

training plans for experienced and new entrepreneurs, clear rules for the use of the facilities during

and after the training with a cost escalation (for example, it is recommended to allow SMEs to use

the facilities free of charge for 6 months after the training, followed by 6 months at 50% of the

published price, after which the full published price will be charged), a chart of costs for use of the

sub-sections of each unit (the published price, which should be slightly above the normal

commercial charges for similar services), pricing of tools and materials (for sale at full cost, except

during the courses, when the cost should be made known to the trainees), a communication

strategy and an M&E system. This being an urgent need for technical assistance to RDB for the

elaboration of the business strategy to ensure the operationality of the BIC. The business plan

preparation is expected to be completed by early March 2012. It was agreed that this activity will

be supported by UNIDO in the framework of the One UN funded project on Livestock Resource

Value Chain Development.


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51

35. The target clients will be micro-small and medium enterprises. At the beginning, the services

will be offered for free, with an intention of attracting many SMEs to centre, and be able to know

their services. At some stage, clients will be paying a service fee. RDB have made it clear, the service

fee is not met to recover the operating costs of the centre but rather, aimed at encouraging its clients

to have the culture of paying for a culture. This kind of arrangement is very worrying. Service fee is

not yet determined, for how long? For whom? Certification procedure is not yet envisaged, although

this is very important. The training plans and curriculum not developed and there is no operational

plan in place. However, it is planned that, all these details shall be captured within the business plan

to be prepared in partnership with UNIDO by early March 2012. The mission noted that, there is a

lot of local SMEs ready to benefit from the centre. However, one would wonder if there are enough

prospective entrepreneurs to make good use of the facility.

36. In terms of outreach, RDB plans to start by offering free services so that, they get to know

more about the centre (unit) and their respective service package. This will be supplemented by

national advertisements-radio/TV and newspapers calling and informing the SMEs about the centre.

Also, the outreach will be through the existing district cooperative officers, business development

centers (BDCs) and business development service centre(BDSs), district SME facilitators and

proximity business advisors (PROBAs) specifically for the Rural-Micro SMEs. The mechanism on

how best these service providers will be involved is not yet defined.


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52

Attachment 1: Draft models of the RSME Service Vouchers

The models proposed on the next page (Figures 1 and 2) have been developed with reference to the

voucher model used by MINAGRI to provide access to fertilizers and seeds. These vouchers

commonly known as NKUNGANIRE in Kinyarwanda are more secured to avoid fraud while using

them or imitation of the IT system linked to it. Similarly, the RSME Service Vouchers would be

completely translated into Kinyarwanda to facilitate understanding by all concerned parties.

The following would be the key features of the vouchers:

- The front of the voucher: The front of the voucher will be used to enter information on the

RSME operator (the owner or manager), the RSME business location, and the SACCO that

sells the voucher to the RSME operator. It also mentions the basic rules of the voucher use,

and the value of services. The front is to be filled in by the SACCO at the moment of sales.

- The reverse side of the voucher: The back of the voucher will serve to collect information on

the basic data on the PROBA and the RSME recipient; the services rendered, and the further

services needed. It also is signed by both the PROBA and the RSME operator to certify that

the services were actually delivered and received. This side of the voucher is to be filled in

by the PROBA.

- The lower section of the reverse side of the voucher contains information on the redemption

by the SACCO, and is to be filled in by the SACCO operator.

Note: MINAGRI has developed a voucher system for fertiliser and agricultural inputs, and

gathered considerable experience with it. The MINAGRI staff met by the mission has expressed

their availability to assist MINICOM in finalising the RSME Service Vouchers.


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Figure 1: Model Front Side of the Voucher

Voucher Serial No. ………….

REPUBLIC OF RWANDA - MINISTRY OF COMMERCE AND INDUSTRY

RSME Service Voucher

This voucher is good for the payment of services only to the RSME mentioned below, and

only by accredited Proximity Business Advisors (PROBAs).

Sales price to the RSME: RWF 500

Name of RSME ……………………………….………… individual or cooperative

Name of RSME operator: ……….…………………………….…… ID No..……………

District ………..…………………………... Sector ………………………………..

Sold by: Name of SACCO ……………………………….… Sales date ………20….

Voucher value RWF 5,000

This voucher may not be sold, transferred or refunded.

Figure 2: Model Reverse Side of the Voucher

Basic Data on Services Provided

Name of PROBA ………………...…………………… Accreditation No.: …………………

Date of service ……… . Duration:…… hours provided at RSME location elsewhere

Year the RSME started business: …… Main activity: ………………………………………

Number of employees now: … men and … women, including apprentices: … m, … w

Estimated annual turnover (last year): RWF …………………..… in 20…..

Details of the services rendered by PROBA:

………………………………………………………………………….………………………

………………………………………………………………………….………………………

Further services required by the RSME, as assessed by the PROBA and RSME:

………………………………………………………………………….………………………

I have delivered the above service fully. Date……… PROBA signature ……………………

I have received the above service fully. Date……… RSME signature ……………………

_________________________________________________________________

Redeemed on ……….. at the SACCO: ………………………………………..

Operator: …………………………. Signature: ..…………………..


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Attachment 2

DRAFT TERMS OF REFERENCE

RSME Facilitator

1. Introduction and objectives The SME Policy objective 2 aims at facilitating SMEs access

to business development services, covering micro, small and medium enterprises. For the rural

microenterprise development in Rwanda, there is a sound need for business development services by a

very large number of rural microenterprises, which together with agriculture constitute the basis of the

currently weak rural economy.

2. In response to this unfulfilled need and consistent with the SME Policy, it was observed that

while no central level agency is oriented towards filling this gap, the districts and sectors are well

placed and mandated to facilitate such services. Furthermore, recognizing that some of RSMEs are not

capable to pay business advisory services, and the capacity constraints in local government and

MINICOM‟s intentions of building demand-driven services, service provision by small-scale

businesses in rural areas initially supported through a voucher system presents itself as the system of

choice. In this regard, MINICOM has decided to initiate the Proximity Business Advisory (PROBA)

Scheme through its Single Project Implementation Unit (SPIU) and in partnership with the districts.

3. PROBAS target group. Most generally, the PROBA Scheme aims at getting two actors

together: (i) the PROBA (Proximity Business Advisor) and (ii) the RSME (Rural Small and Micro

Enterprise, both individual enterprises and cooperatives). PROBAs will be small-scale rural

entrepreneurs who offer part-time advice to RSMEs . Through the scheme, the RSME will get

business advisory services from the PROBA of his or her choice. The services will be subsidised

through a voucher system.

4. PROBAs will offer the following services:

Training and coaching in business management (accounting and bookkeeping, taxation, start-

up business management, business plan writing, entrepreneurship, cash management, use of

financial services, and marketing;

Business counseling for RSMEs in distress; and

Technical training depending on the specialization of the PROBA

5. PROBA Scheme principles:

Demand-driven: This aims at addressing true needs of the RSMEs based on their own

judgment. The culture of external identification of trainees and their training needs, and

receiving services free of charge will be replaced by the one of the RSME identifying itself

a suitable service provider (PROBA) and the service required, nad negotiate and pay

demanded and delivered services directly.

Negotiation: The RSMEs will be able to negotiate themselves the needed services with a

service provider (PROBA) and exercise independent choice.

Cost based on quality of service: Quality control becomes and remains the responsibility

of the RSMEs. This will improve quality of services rendered to RSMEs and payment shall

be consequently applied.

Feedback. The PROBA will fill in basic information on the service delivered on the back

of the vouchers.

6. The District PROBA Committee will be composed of 5 members: district Vice-mayor in

charge of economic affairs, district Executive Secretary (as district budget manager), RSMEs

facilitator (head of operations and PROBAS reporter or secretary), District Cooperative Officer, one


Follow-up Report

55

sector Executive Secretary and one RSME representative, nominated by the local business

community in the district. It will be responsible for:

Approving the PROBA accreditation proposed by RSME Facilitator;

Approving eligible RSMEs voucher recipients proposed by the sectors; and

Evaluating monthly the evolution of the PROBA Scheme and provide guidance to the

RSME Facilitator and the sector administrations.

7. The RSME Facilitators will be hired at the district level on a contract basis. Reporting to

the District Vice-mayor for Economic Affairs, each RSME Facilitator will be responsible for:

m) Establishing the District PROBA Committee and acting as its secretary (to call for

and prepare meetings, information notes, minutes, etc.);

n) Ensure sound general awareness and understanding of the PROBA Scheme in the

district, including the sectors (through publicity campaigns, etc.);

o) Arranging for a call for expressions of interest by operators of well-functioning rural

businesses to become PROBAs;

p) On an annual basis, assessing the suitability of the applicant RSME operators and

accrediting them as PROBAs (starting with the former formateurs d‟entreprise, FEs);

q) Submitting PROBAs for final accreditation to the District PROBA Committee;

r) Constantly up-dating and making accessible to RSMEs the list of accredited

PROBAs in the district, with contacts and specialization in service provision;

s) Guiding the district and sector administration in selecting the RSMEs that are

eligible for buying vouchers;

t) Establishing with the Sector SACCOs the modalities for selling vouchers to eligible

RSMEs, and for buying filled-in vouchers from PROBAs who received these in

payment for services;

u) Investigating any allegations of fraud regarding the voucher system;

v) Maintaining the district database on vouchers distributed and returned, including the

details from the returned vouchers;

w) Providing short monthly analyses to the District PROBA Committee of the

functioning of the PROBAs Scheme on the basis of the district database; and

x) Maintaining links to the SPIU and other RSME Facilitators on the development and

implementation of the PROBAs Scheme, with a view to improving its performance.


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APPENDIX 4: COOPERATIVE DEVELOPMENT

A. Cooperative management and business skills

1. The project has been supporting 850 cooperatives with coaching and training services. The

basic training services provided to all 850 cooperatives includes cooperative management (3 days),

accountancy (5 days), business and financial planning (4 days), marketing (4 days). The majority of

the selected cooperatives operate in the tailoring (179), the handicraft (161) and the honey sub-sector

(122). 31 cooperatives are engaged in fruit processing, and 6 in cassava processing. More than a third

(328) don‟t operate in the priority value chains, and have been supported before the prioritization of

the above-mentioned sub-sectors. Most cooperatives (827) have a turnover below RWF 1 million per

year. In the year 2010/11, 4 322 members have been trained in cooperative management, which

means that 68% of the planned outputs has been achieved.

2. Some 3 714 members organized in 171 cooperatives have received intensive coaching in

the development of cooperative development plans. The activity, which takes 30 days per

cooperative in average, started in November 2009. Following the agreement with the implementation

support mission in October 2010, more focus has been given to coaching in business planning

including investment and financial planning, concrete activities such as market and technical studies.

3. Special attention has been given to 35 of the cooperatives with high turnover (more than

RWF 1 million) – officials, managers and members have received advanced coaching in accounting,

which should ensure that the members, staff and officials are prepared to deal with the increasing

complexity of their growing business.

4. The simplified and summarized guides for cooperative management and governance have

been distributed to cooperative unions and federations as well as to the CER. However, these

documents are principally required by the cooperatives themselves, in Kinyarwanda. RCA agreed to

distributing the guidelines further, to establish a list of recipients, and to using them in its coaching

programme.

Table 1 : Supported cooperatives with a turnover of less than RWF 1 million /a:

Province Tailoring Handi-

craft Fruit Manioc

Api-

culture

Outside

value chain Total

North 67 51 4 - 44 104 270

South 18 31 11 4 30 46 140

East 37 35 15 2 30 66 185

West 57 44 1 - 18 112 232

Total 179 161 31 6 122 328 827

Table 2: Supported cooperatives with a turnover of more than RWF 1 million /a

Province Tailoring Handi-

craft Fruit Manioc

Api-

culture

Outside

value chain Total

North 1 - 1 - 1 4 7

South 1 - 1 - 2 1 5

East 1 - 1 - - 5 2

West - 1 1 - - 1 2

Total 3 1 4 - 3 11 22


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Table 3 : Cooperatives coached in development plans

Province Cooperatives Trained Members

Female Male Total

North 57 512 700 1 212

South 87 851 750 1 601

East 22 350 300 650

West 5 102 149 251

Total 171 1 815 1 899 3 714

Unions and federations

5. Some 9 cooperative unions and 5 cooperative federations operating in the priority value

chains have been created with project support. The project – through the collaboration with RCA -

assisted in the organization of constituent assemblies for 3 new federations and provided training in

cooperative management to 140 leaders of 14 unions (77% achievement of the AWPB 10/11).

Strengthening proactiveness and self-reliance

6. The mission noted a varying level of performance of the cooperatives and their unions.

Especially business skills and problem solving capacity have to be developed further to reach

operational and economic sustainability of these groups. It was thus agreed to focus in the future on

strengthening pro-activeness and on the development of marketing skills adapted to their specific

context.

7. It is recommended to integrate the principles of pro-activeness in the training modules, using

context-specific examples, and analyzing – in a participative manner – key mandates and constraints of

cooperatives and potential proactive behavior which aims to avoid negative development and to

promote favorite conditions. Thereby the cooperative leaders should be encouraged to bring in their

own experience and to suggest solutions through proactive behavior and self-reliance.

B. Collaboration with the Rwanda Cooperative Agency (RCA)

8. The MoU for the next period is to be signed by November 2011 after approval of the final

report. Therefore the existing draft has to be improved. It should clearly indicate quantified expected

outputs for both years as well as time-bound deliverables and reporting format. It should reflect:

special attention to the cooperatives running the demonstration units (DUs) as agreed in

the extension design report (Paragraph 28).

Pro-activity is anticipating and taking charge of situations by causing something to

happen rather than waiting to respond to it after it happens. In Organizational Behavior

proactive behavior (or proactivity) by individuals refers to anticipatory, change-oriented

and self-initiated behavior in the work place. Proactive behavior involves acting in

advance of a future situation, rather than just reacting. It means taking control and

making things happen rather than just adjusting to a situation or waiting for something to

happen. Proactive employees generally do not need to be asked to act, nor do they

require detailed instructions.

(Whiteley, Paul L.; Blankfort, Gerald (1933), "The Influence of Certain Prior

Conditions Upon Learning", Journal of Experimental Psychology (APA) 16: 843–851)

http://en.wikipedia.org/wiki/Organizational_Behavior


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the support activities to cooperative unions, federations and apex organizations,

including training, value chain data base, equipment, etc.

that all support to cooperatives, unions and federations be limited to institutions created

before 2012, so as to ensure sufficient time to reach sustainability.

9. The MoU should also reflect

The decision of MINICOM to move towards a more demand-driven service provision.

the day-to-day collaboration between the SPIU and RCA with the objective to transfer

more responsibility and capacity to RCA.

10. The Conseillers d’entreprise rurale (CER) are currently working with RCA, coaching and

training some 150 cooperatives participating in the Crop Intensification Programme (CIP). The

temporary services delivered by the CER are highly appreciated by these cooperatives. The leadership

emphasized the usefulness of the marketing advice and linkages to buyers provided. The CER continue

thereby the PPPMER approach. It appears that there is no concept note or strategy paper or specific

training of CER elaborated or planned for guiding the work of the CER. The agricultural focus of most

of these cooperatives as well as the advanced status of some suggest that the targeting is not fully in line

with the PPPMER objectives of supporting rural microenterprises.

11. It was agreed that the CER will continue to provide intensive coaching to these cooperatives

until the end of 2011. In order to reach long-term effects, the coaches have to concentrate on key

constraints and emphasize proactive business management.

Inspection and audit

12. In order to improve RCA capacity in inspection and audit, 68 staff were trained (90%

achievement of AWPB 2010/11). According to RCA, 258 cooperatives have been inspected since

February 2011. The Project‟s annual report 2010/11 mentions 8 inspections, while 192 were planned

for the same period. The contradictory numbers provided suggest that reporting has to be seriously

improved.

C. Planning, Reporting, MOU

13. The mission notes shortcomings in the reporting format, timeliness and completeness.

Quarterly and annual reports have not been submitted as agreed in the MOU, delays led to

incompleteness of the project‟s annual report. Progress statements are missing for several activities.

The final report of the collaboration period ended in June 2011 has not yet been submitted. It is

agreed that the report be submitted by end-November 2011.

The cooperative KOABIKI in Musanze takes part in the CIP and has received intensive

coaching by the CER during 3 months in 2011. The cooperative buys and sells mainly Irish

potatoes, provides technical advice and to its members and sells inputs, mainly fertilizer. In 2010, the cooperative sold more than 1 300 t of potatoes for about FRW 120 million.

The institutional management and governance structures of KOABIKI are largely in line with

the RCA guidelines for cooperatives. However, the fact that the cooperative president has

been re-elected after a term of 3 years appears to be in contradiction with the guidelines.

KOABIKI governance seems to be transparent and well documented – the bylaws as well as

the minutes of the last 2 meetings, which are mostly organized in a frequency above 3 times per semester, could be presented instantly.

It appears that many of the 75 members cannot be considered poor - the annual quantity

produced by each member ranges from 20 to 200 t of potatoes. A number of members possess lorries, which are regularly hired by the cooperative for produce collection.


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The reporting format is to be improved, presenting a cumulative comparison of expected

(according to MoU) and achieved results.

More explicit explanation of activities is required. For instance, training content (e.g. training in

cooperative management, business plans, or marketing) and beneficiaries have to be clearly

defined.

More emphasis should be given to qualitative assessments and comments. Especially when

achievements are significantly below expectations, the related constraints have to be outlined.

A short paragraph including a history of the activities, the objectives and the strategic context

helps in the planning and reporting of activities and facilitates their understanding for other

stakeholders (e.g. partners, support missions and consultants).


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APPENDIX 5: HANDICRAFT AND TAILORING VALUE CHAINS

Support to product development

1. 168 cooperatives and 207 individual enterprises engaged in handicraft and tailoring have

received coaching and training services through the project. The mission notes a varying

performance in the training of artisans - the annual achievements (2010/11) related to training

activities range from 60% to overachievement, which is left without comment in the annual

report. The Project facilitated training in basket weaving for 164 RSMEs, which means an

achievement rate of about 60%. Some 459 persons have been trained in tailoring and weaving

(168% AWPB achievement).

2. A comparison of the turnover of 92 handicraft cooperatives in the years 2008 and 2009

suggests an increase of 45 % and thus a big impact of PPPMER-funded training and other

services. However, limited business skills and pro-activeness hinder many RSMEs and

cooperatives in effectively using the obtained skills for business improvement.

3. Further handicraft and tailoring training should concentrate on businesses that have a

clear vision and a professional business attitude. The delivery of training should be more

demand-driven and be tied to the elaboration of realistic business and marketing plans so as to

increase the efficiency of PPPMER support. The new AWPB 2010/11 foresees training only in

pottery and tailoring. SPIU should be prepared to facilitate other handicraft trainings as

demanded by the target group.

4. Furthermore, the SPIU should make more use of monitoring data so as to analyze

effectiveness and efficiency of support activities, which should guide further planning. Thus it is

vital to continue the monitoring of RSME and cooperative financial figures such as turnover and

profit (also for 2010).

A PPPMER success story: The cooperative COOPAV-Mararo in Musanze runs this shop at the entrance of the national park. Especially international tourists like to buy the handmade baskets, handbags, puppets and carvings. PPPMER assisted amongst others with training and coaching in cooperative management and handicraft techniques as well as marketing advice. Vice-president Marie Rose says: "With the help of PPPMER the cooperative has brought enormous improvements to our lives. Our incomes have multiplied since its creation in 2004."


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Transfer of activities to partner institutions

5. In view of the transition of the Craft industry Secretariat (CIS) to project status, and in

line with the SME policy, further activities as of 1 January 2012 are to be carried out by partner

institutions such as PSF (for marketing support), WDA (for innovation and technical training)

and consultants (for workshops with clearly specified targets). The SPIU should assist and

consult the latter on a day-to-day basis.

Marketing support

6. The mission notes that marketing support is largely limited to beneficiary trade fair

participation, which is of limited effectiveness and very costly. It was agreed that the SPIU put

more emphasis on demand-driven and context-adapted coaching and training in small-scale

marketing, focusing on strengthening self-reliance and pro-activeness among the RSMEs. Local

service providers, such as the PROBAs, should be trained by creative business persons for this

purpose.

7. Kigali show room. The planned Kigali show room is supposed to be used as sales outlet

for the best artisan products of the country. It is planned to be operated by a committee yet to be

nominated. In view of the management constraints in the context of the artisan houses, the

mission does not concur with this proposal. Instead, it recommends working with a private

operator, who would manage the shop as profitable enterprise. Incentives and support would be

provided in the form of business development services through the BDCs or BDSs and temporal

subsidies to shop rent (up to 50% and up to 6 months). The entrepreneur would be invited to

participate in the HEAP committee so as to facilitate constant linkages to master artisans and to

national and international buyers and experts.

8. The Handicraft Excellence Award Program (HEAP). The mission is pleased to note

that the first national handcraft competitions have been successfully conducted. HEAP is to

support artisans, encourage innovation and quality products by supporting the most talented

artisans through specific activities. However, these activities and objectives are yet to be clearly

presented in a concept note, and the communication material to be revised following the

recommendations in the last follow-up report (May 2011, Appendix 3).

9. For the future design of HEAP, it is recommended to emphasize promotion and market

linkages, and to integrate workshops on design and product development, guided by international

designers: workshops with international buyers from inside and outside the country, design

students and/or teachers from arts schools (also students and teachers from Nyundo school can

be invited) from import countries and eventually specialized NGOs and associations working on

innovation in handicraft, as well as a selection of private operators (especially exporters) and

talented artisans (master artisans). (For further details, see follow-up report May 2011,

Appendix 3).

10. The MOUs concerning ownership and use rights of the meanwhile 17 artisan houses and

kiosks have still not been signed by the accordant district authorities, and the handover

ceremonies with all concerned stakeholders are yet to be organized. It was agreed that the

conclusion of these MOUs be a priority activity of MINICOM to be finalized by the end of 2011.


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Table 1 : Artisan Houses funded by PPPMER

No Names Province District Purpose

1 Gakenke artisan house North Gakenke Production and sales

2 Rulindo artisan house North Rulindo Production

3 Gicumbi artisan house North Gicumbi Production

4 Musanze artisan house North Musanze Production and sales

5 Burera Kiosque North Burera Trading

6 Gashoba artisan house South Huye Production

7 Gako artisan house South Huye Production

8 Rwaniro artisan house South Huye Production

9 Kinkanga artisan house South Huye Production

10 Nyaruguru kiosque South Nyaruguru Trading

11 Gatsibo artisan house East Gatsibo Production

12 Kayonza artisan house East Kayonza Production and sales

12 Nyagatare artisan house East Nyagatare Production

13 Kayonza kiosque East Kayonza Trading

14 Bugesera East Bugesera Production

15 Karongi West Karongi Production and sales

16 Nyamasheke West Nyamasheke Production and sales

17 Rubavu West Rubavu Production and sales

Planning and reporting

11. In view of the increasingly scarce project resources, it was agreed that the value chain

activities require more rigorous planning, with strategic objectives and a priority afforded to

activities with low costs per client. The plan should include a calendar with quantified

objectives, the roles and responsibilities of the SPIU and its partners.

12. Progress reports. It was agreed that the format of the progress reports be improved in the

sense that quantified targets and achievements are clearly indicated and activities are classified

so that a coherent picture of planned and conducted activities is reflected. The SPIU should

furthermore request the partner institutions‟ progress reports to be submitted on time, and insist

on the SPIU reporting format. Moreover, the SPIU should provide brief feedback on the reports.

AWPB 2011/12

13. There is need to further revise the AWPB for the handicraft and tailoring activities:

The Craft Industry Secretariat (CIS) is - despite its transfer to the SPIU as a project - still

mentioned as key player in artisan promotion. The AWPB should reflect a sound

reorganization of mandates previously planned for the CIS.

It appears that the Support to Hanga Umurimo Program will be provided through the RSME

Development Project and not through PPPMER. It should therefore not be mentioned as a

PPPMER activity in the AWPB.

14. The handicraft sector study related recruitment of a consultancy firm is in its final

stage. The mission finds that related TOR are still too vague to ensure quality results. It was

agreed that the TOR be further elaborated with specific details without changing the scope of the

study, and that a census of handicraft enterprises is not required. A proposed revision of the TOR

is outlined in Annex 3 of the follow-up report May 2011.


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Attachment 1: Annual turnover of handicraft cooperatives in the years 2008 and 2009


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APPENDIX 6: FINANCIAL SERVICES FOR RURAL SMES

A. BACKGROUND

1. Rural Small and Micro Entreprises (RSMEs) play a major role in alleviating poverty and

developing a country‟s national economy. Lack of access to finance has been identified in the

Government of Rwanda (GoR) policy for the development of SMEs as one of the biggest challenges

for SMEs. The 2008 FINSCOPE Survey found that 52% of the adults in Rwanda had no access to

financial services either formal or informal. To remove barriers to accessing financial services, the

GoR is implementing the Umurenge SACCO Strategy where a Savings and Credit Cooperative

(SACCO) in each sector of the country is being established and the microfinance industry is also

being formally regulated. Furthermore, the Access to Finance Rwanda (AFR), which aims to provide

coordinated support for improving access to financial services, has been requested by GoR to finance

the formulation of a Rural Finance Policy.

2. PPPMER strengthens rural microenterprises managed by individuals or cooperatives to

modernize them, improve their management and create jobs. One of the main objectives of the

project is to provide entrepreneurs with access to sustainable financial services. Since 2007, the

project has been providing financial services to RSMEs through partnerships with the Banque

Populaire du Rwanda (BPR) and microfinance institutions (MFIs).

3. The section below provides an update on the findings of the mission relating to the project‟s

objective to improve access to financial services through the BPR and MFIs and also provides

recommendations to improve implementation.

B. CURRENT SITUATION AND AGREEMENTS

4. The SME Development Policy sees a lack of harmonization of the different funds

supporting SMEs‟ access finance as they are managed by different entities. Consequently, the

BRD Development Fund (BDF) has been mandated by this Policy to manage funds aimed at

providing finance to SMEs. BDF is a newly established company aiming to support SMEs

through on and off-farm guarantee funds, lines of credit as well as advisory services. It has

begun its operations and the table below illustrates the different guarantee funds it manages.

Table 1: Funds managed by BDF on September 2011

BDF Guarantee Funds Amount (RWF million)

SME Guarantee Fund 3 314.2

Agricultural Guarantee Fund 911.3

Retrenched Civil Servants Guarantee Fund 511.3

Women Guarantee Fund 122.6

Total 4 859.4

5. As previously agreed, the BDF will continue the wholesale management of the PPPMER

credit lines to BPR and the participating MFIs. However, the PCU has not advanced in the

handover arrangements of the credit lines. It was now agreed that the SPIU prepare a wholesale

credit transfer agreement by end-November, specifying that MINICOM will carry the lending

risk and detailing management and reporting obligations, cost recovery and incentives for BDF

services, and eventual reimbursement to MINICOM. The agreement will be signed between

MINICOM and BDF. For the financial institutions, the terms and conditions of the credit lines

will not change, except that the progress reports will need to be submitted to BDF rather than to

the PCU.


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6. In addition, in an effort to reduce the retail lending risk, it was agreed that BDF will

expand its range of credit guarantees to also cover SME loan portfolios. For this, it will develop

a concept note describing the terms and conditions of the product, the review procedures, and the

eligibility criteria. To cater effectively for the SME sector, it is critical that simple wholesale

approval mechanism can be found, and that working capital loans be explicitly included in the

guarantee cover.

7. The mission recommends that the SPIU prepare for BDF a note on lessons learnt on its

wholesale credit lines. It is also important that the SPIU‟s Sector Specialist, Access to Rural

Finance, develop a closer working relationship with BDF, directly supporting the planning

processes and thereafter following up on the agreed arrangements.

8. Banque Populaire du Rwanda (BPR) is in partnership with PPPMER to provide access

to financial services through 63 of its branches and sub-branches nationwide. The revolving BPR

credit line has a total amount of RWF 785.6 million. So far, it has financed 1 921 projects

(predominantly tailoring and carpentry ones) for a total amount of RWF 969.2 million.

Table 2: BPR Credit Line on 30 September 2011

Amount (RWF)

Total Credit Line 785,599,635

Number of Projects 1,921

Outstanding Balance 213,194,366

Total Repayment (cumulative) 839,262,276

Arrears Rate 36%

9. Its current outstanding balance of RWF 213.1 million has an alarming overall arrears rate

of 36% that partly reflects high risk, and partly the fact that no loans have been disbursed for

about a year. For instance, the mission visited Busasamana BPR sub-branch and noted that the

last loan was issued in July 2010. Despite the low usage, BPR is interested in a re-launch of the

credit line for this particular target group by developing improvements, including a consistent

collaboration with Credit Analysis and Evaluation Committees (CEACs) and also with the

district-based Access to Finance Forums. The CEAC is a sector-based group that pre-screens

loan applications before the bank‟s review, and also helps to sensitize RSMEs about financial

services and helps with recovery and follow-up. The CEAC is composed of three RSMEs

representatives, a BPR/MFI representative and the sector agronomist. Despite these useful

services, so far most CEACs have never received the premiums stipulated in the BPR‟s credit

agreement with the PCU. It was agreed that regular payments to the CEAC begin immediately,

and that the project support one member per CEAC for coordinator functions.

10. The Access to Finance Forum is a new district-based mechanism to address financial

service issues, including recovery support. The role of the forum is to contribute to reducing

access to finance starting by each district. It aims to develop synergy between development

partners and financial institutions operating at the district and is composed of:

- Vice Mayor in Finance and Economic Development (Chair Person);

- District Police Commander;

- District Representative of the Prosecution;

- District Cooperative Officer;

- District Legal Advisor;

- Representatives of MFIs and SACCOs;

- Representatives of financial institutions (commercial banks, insurance companies etc);


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- Representative of the Private Sector Federation;

- BDS representative;

- Technical Control Unit of SACCOs; and

- Development partners supporting rural finance and microfinance development.

11. With the high levels of non-performing loans, BPR has agreed to provide lists of

defaulters to the forum to facilitate recovery. Close follow-up from the branches and

subbranches in each district will be required to make this partnership function well.

12. The mission noted many reporting issues including reporting delays by BPR

headquarters, poor format adherence by many BPR branches and sub-branches and lack of

feedback to the reports. For instance, the September 2011 report from the Kiramuruzi and the

Rukara BPR sub-branches indicated neither the arrears rate nor the date of the recent repayment

and anticipated date of last repayment. Some branches have not yet received the new reporting

format developed by the project, and it was agreed that BPR improve its reporting and fill its

data gaps, with assistance by the SPIU. In addition, an assessment of BPR‟s statements on the

credit line is planned to establish the current situation by end-November before transferring the

credit line management to BDF.

13. MFIs: The project also works with Duterimbere MFI through a RWF 30.0 million credit

line that has funded 30 RSMEs for a total of RWF 11.4 million, with an arrears rate of 2%.

Problems remain in the accessibility of funds and in reporting (similar to BPR). The total amount

of the credit funds are to be increased by 0.25% monthly, which is however not reported by the

MFI so that the total current amount of the credit funds is not known.

Table 3: Summary of credit line to Duterimbere MFI at 30 September 2011

Amount (Rwf)

Total Credit Line 30,000,000

Number of Projects not known

Outstanding Balance 25,960,615

Total Cumulative Repayment 8,225,271

Rate of Arrears 2%

14. The SPIU will also assist Duterimbere MFI in improving its working relationship with

the CEACs, and the MFI will share information on defaulters with the Access to Finance Forum.

15. The two other MFI credit lines need to be discontinued with urgency. CT Byumba

recently closed down and as a result the recovery process must be initiated immediately. It was

noted that the agreed recovery of the funds from UCAPEC has not begun, and that notice needs

to be given immediately to the SACCOs to repay the credit funds borrowed by UCAPEC. CT

Byumba received a credit line worth RWF 20 million while UCAPEC received RWF 50 million

however it is not clear how much interest was accumulated and the SPIU needs to calculate the

interest together with the MFIs before it initiates the recovery process.

16. The recovery rate of the 14 old MFIs is moving at a slow pace as there has been no

further repayment since the last mission. A total of RWF 13.5 million out of a total RWF 31

million has been recovered. The SPIU should increase its efforts in recovery of these funds.

17. Financial capacity building. Through RCA, the project supports some Sector SACCOs

by building their capacity to provide financial services to RSMEs. A needs assessment was


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conducted and identified the need for capacity building of SACCOs staff on day-to-day

management of SACCOs. Thus far, three manuals and seven modules have been developed and

management training is ongoing including savings mobilization and management, audit and

finance management.

18. The mission noted that the modules are only available in English and it is important that

they are translated to Kinyarwanda. It was agreed that a capacity building work plan for

SACCOs be developed immediately by RCA to guide its support to priority areas.


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APPENDIX 7: GENDER INCLUSIVENESS

Gender Mainstreaming in Design and Implementation

1. The project extension design report views gender from a rights-based perspective and

requires “meaningful participation of women” in the interventions. Although no set guidelines or

requirements on how this would be achieved, the mission observed efforts towards inclusion of

women in project activities. This was mainly through “women-only” projects such as tailoring and

basket weaving programmes. However, these women-only enterprises were found to be less lucrative

than men‟s enterprises. It is therefore important to encourage women to venture in traditionally men-

only enterprises for better returns. In the Masaka Business Incubation Centre, for example, it was

observed that in the leather component, there were 15 female trainees out of 50 and only 2 female

trainees out of 20 trainees have completed the three set modules. It was further reported that even the

2 are not currently active in the trade. The project should make deliberate efforts to encourage and

support women to take advantage of the opportunities it avails.

2. In terms gender equality in decision making, the mission noted that women are relatively

well represented in the decision making positions of the cooperatives. The need for continued

enhancement of managerial skills as well as self-confidence for women leaders was however

observed. In one of the cassava demonstration units visited (CATM cooperative), the membership is

made up of 91 members of whom 49 are men and 42 women. The president of the cooperatives was a

woman and she attributed her election to training she had previously received through the project.

Consistent mentoring of the cooperatives will help identify those that need further capacity building

especially in managerial skills.

3. The SPIU needs to institute a mechanism to address issues of gender equality and women‟s

empowerment and assign the responsibility of tracking and overseeing gender to a staff. The

requirement to address gender in all public activities in Rwanda has been endorsed in many

government policy documents (the National Gender Policy - 2010; the Economic Development and

Poverty Reduction Strategy 2008-2012). Promotion of gender equality and equity as a prerequisite

for sustainable development is a fundamental principle within the Constitution of the Republic of

Rwanda, 2003; to which the Government of Rwanda attaches great importance. The Rwanda Vision

2020 regards gender as an important cross-cutting issue. This gender-friendly policy environment has

facilitated gains towards gender equality in different areas (especially the parliamentary

representation). However, there are still gender disparities especially among the rural poor which

must be addressed. In this respect, it is important for SPIU to view gender as a human rights issue but

also (and more relevant to MINCOM) as a developmental issue. Poverty affects men and women

differently, mainly due to existing inequalities in terms of development opportunities, as well as in

the management and control over economic resources. The overall responsibility for gender

mainstreaming at SPIU should be recognized as an institutional responsibility and all staff and senior

management should be accountable for performance in this area. However, it was agreed that the

SPIU appoint a gender focal point who will act as a „champion‟ on gender mainstreaming and be a

catalyst for gender issues in at SPIU. The gender focal person should have a strong commitment to

the goal of gender equality; support development of gender sensitive indicators to allow monitoring

and evaluation as well as promote and support the collection of gender-disaggregated data.

Gender Sensitivity in M & E Systems

4. It is important to monitor project impact on gender relations in order to detect gender

disparities in the distribution of benefits and adjust the course of action accordingly. Currently,

reporting on gender in PPPMER and the SPIU is not an institutional requirement and therefore

depends on individual initiative. The sex disaggregated statistics, which was observed in some

PPPMER reports, need to be backed by qualitative analysis on the reasons behind the numbers and

statistics. This will enhance learning on gender equality, an opportunity which has often been missed


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in the project. The Rwanda Cooperative Agency (RCA) for example, hired a firm which among other

things undertook a training needs assessment to inform the design and implementation of training

programmes for cooperatives. However, there was no effort to assess the gender differentiated

training needs between women, men and the different age categories. Making gender reporting a

routine institutional requirement will ensure that such opportunities are not missed. The M&E

system should have qualitative tools that help analyze the gender differences observed in the

quantitative data. The use of gender sensitive indicators would ensure gender responsiveness in

M&E system as measurement tool for analysis, learning and institutional response on gender. All in

all, gender impact and empowerment should be integrated into monitoring and evaluation.

5. The manner in which gender-related information is presented in monitoring and evaluation

reports needs to be consistent, in order for the SPIU to be able to make comparisons across projects.

Gender-sensitive monitoring and evaluation reveals the extent to which a project has achieved

improvements in the lives and overall social and economic well-being of women and men. It also

improves project performance during implementation, allows for mid-term corrections, and makes it

possible to derive lessons for future projects.

6. The efforts observed in component III (rural finance) to introduce a new reporting format,

which is disaggregated by gender, are commendable. However, even this needs the backing of

qualitative information. It will be important to track social outreach and outcome in this component.

For example, it should compare the total number of active male versus female borrowers (gender

ratio of loan size) or the total number of voluntary savers (gender ratio of savings size). The SPIU

should then use qualitative analysis to understand any differences observed. To mainstream gender in

an inclusive financial sector, it is important to go beyond access alone and consider how access can

enable women and men to challenge and change gender inequality as well as household and

community poverty.

Gender Issues in the Apprenticeship Programme

7. The total number of women supported in apprenticeship is higher than men‟s. However, men

and women are concentrated in different trades according to the „traditional lines‟. For example,

tailoring is almost exclusively dominated by women while carpentry is dominated by men. The

mission noted that women generally dominate trades which are less lucrative than men’s and

recommends that the sensitization campaigns should include messages that encourage women to join

the traditional male trades (such as leather). While the project‟s efforts in supporting women

specific programmes is commendable, the implementation strategies can be improved as the

interventions sometimes leave the women in a worse off position.

8. A case in point is the Rukundani women‟s tailoring group where the young women got

insufficient training in tailoring from the PPPMER apprenticeship training, and are therefore neither

in a position to make a complete garment nor to market their products. Having taken a loan of RWF

100 000 each, they had to repay the loan through other sources as the tailoring business was not

making any income. Further training on tailoring as a business (designing and making of different

garments as well as marketing) will be necessary to make this particular initiative economically

profitable. In general, planned linkage of the apprenticeship component with WDA will ensure a

higher standard in the quality of training provided.


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APPENDIX 8: MONITORING AND EVALUATION

1. Rural Small and Microenterprise (RSME) database. PPPMER operates a database with

information on the RSMEs that the project currently supports in all districts of the country. The

database contains information on individuals, associations and cooperatives grouped by name,

location, economic activity, equity, working capital; to name a few. The database however has

limited use as it is currently used as a reporting tool and not for advisory or guiding management

decisions. There has been no progress made in updating the database since December 2010.

Table 1: Coverage of PPPMER database on RSMEs per province, December 2010

Item Western

Province

Eastern

Province

Southern

Province

Northern

Province Total

Individual RSMEs 755 1 286 704 1 216 3 961

Cooperatives and associations 152 301 171 700 1 324

Total RSMEs 907 1 587 875 1 916 5 285

Individual RSMEs 755 1 286 704 1 216 3 961

Cooperative/ association members 3 839 6 433 4 180 9 035 23 487

Total persons 4 594 7 719 4 884 10 251 27 448

2. RSME service database. To satisfy its information needs on business development

services, it was agreed that the SPIU will establish a more comprehensive database on RSME service

provision countrywide, fed with gender disaggregated information from the vouchers of the PROBA

Scheme, to be provided monthly by the districts. Through the PROBA scheme, the vouchers will also

be used as a data collection tool and gather information such as the kind of business services

received, turnover, net profit, marketing used, and innovations introduced by the RSME. This will

allow tracking of progress made by the RSMEs and such information is important for effective

interventions targeted for RSME development. For example, the RSME service database will provide

information on what kind of training is most sought after by the clients, which will be important for

the planning of the kind of further training to be provided to the PROBAs.

3. The information would be gathered by the PROBA advisors and entered into a district

RSME service database which will be connected to the central database managed at the SPIU level.

At the ministry level, data is consolidated from each district and is used for analysis, reporting and

also for providing feedback to the districts. For example, it would be useful for the districts and the

RSME Facilitators to know how their district is faring in the national comparison. It is important that

this system, including the data to be collected on the vouchers and the districts‟ role, include the key

data to be collected by the PCU, and that it be agreed before the PROBA Scheme begins.

4. In Attachment 1 of Appendix 3 (Rural SME Development) is a draft of the PROBA Scheme

vouchers, including the kind of information that could be gathered on them.

5. The RSME service database will not be able to provide data on progress per RSME, as it

would be too difficult to identify the client businesses separately in the data collection. Impact data is

thus not available per business. Nonetheless, a shift in the group of clients served, even per district

and gender disaggregated, will be possible to deduce by analysis of the data.

6. The SPIU is still in its initial stages of setting up an M&E system. Its M&E Specialist is

currently building on existing M&E frameworks of the different projects to create a single M&E

system with planning and reporting templates for all projects. The responsibilities of the M&E

specialist include regular review on performance, design of data collection methodologies for SPIU

interventions, develop an MIS and carry out regular analysis of data. The M&E specialist will also


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71

provide technical guidance and quality supervision of data collection and data analysis activities and

will spearhead the development of the RSME database through the PROBA scheme.

7. The mission observed that reporting on gender is often haphazard, depending on individual

initiative rather than an institutional requirement. Where there is gender reporting, it normally stops

at sex disaggregated statistics which are not backed by an analysis of the reasons behind the numbers.

As such, opportunities for learning on gender equality are often missed. It was agreed that reporting

on gender will become a routine requirement. Qualitative analysis should be used to explain gender

differences observed in the quantitative data.


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APPENDIX 9: PROJECT MANAGEMENT

1. Project management. The mission notes with satisfaction that the establishment of the

Single Project Implementation Unit (SPIU) is well advanced, with only the establishment of the

SPIU accounts, hand-over of the respective PMUs, their audits, the consolidation of procedures

and the induction training of staff to be completed soon. As a harmonisation of the administrative

and finance procedures manual is foreseen with the establishment of the SPIU, it was agreed with

the mission that the harmonised procedures manual be submitted to IFAD for non-objection in

order to comply with section 6.01(c) of the loan agreement. The harmonised procedures manual

will build on the new Project Implementation Manual (PIM) that has been developed for IFAD

projects within the SPIU in MINAGRI.

2. With the advent of the SPIU, the mission is concerned that all projects accounts might be

merged into a single one that was not agreed upon in the loan agreement. It was agreed that the

SPIU maintain the PPPMER special and operations accounts (to be called sub-accounts), while a

combined counterpart fund account will be established for all SPIU projects.

3. The mission notes with satisfaction that, with PPPMER II operating without a permanent

coordinator since February 2011, the newly established MSME program will also coordinate

PPPMER II under its portfolio of projects. It was agreed with the mission that the change of

signatories to the project accounts be submitted to IFAD for non-objection.

4. Financial management capacity. At the time of the mission, the financial management

function of the project is executed by the former PPPMER II finance unit comprising a Director

of Finance and one accountant. However, effective 01 November 2011, this team will hand-over

the overall finance function of PPPMER II in the SPIU Finance Management Services made up

of a finance management specialist, a chief accountant and one accountant. The recruitment of

two additional accountants is also underway. It was agreed that the new finance unit within the

SPIU fully utilize the experience of the former finance unit for training and familiarization with

IFAD loan administration procedures.

5. The PCU has been using TOMPRO as its accounting software since PPPMER I. It has

been recommended between the SPIU consultants and MINECOFIN that this accounting

software is to be used by all other projects currently using other software or an excel-based

system. The mission concurs with this, and current experience in IFAD-funded projects have

shown that the use of TOMPRO responds perfectly to the minimum best practice disclosure of

expenditure per component, per category of funds, in cash flow/sources and uses of funds and in

detailed accounts per cost centre compared with the AWPB.

6. Planning. The 2011/12 AWPB received IFAD‟s no-objection on 16 August 2011. With

the advent of the SPIU, the mission was informed that all project AWPBs will be consolidated

into a single AWPB, for the format of which improvements were suggested by the mission.

More specifically, for better clarity and execution, the mission suggests that the single AWPB

for the SPIU be segregated by project and not by outcome as it is the case currently. Moreover,

there is a need to improve its format by adding columns on financing percentage by each

participating financier. In addition, the mission noted that a number of MOUs with partner

institutions and service providers are still pending for signature. These need to be finalized soon,

after integrating the mission‟s recommendations. It was agreed that the SPIU submit the revised

and consolidated 2011/12 AWPB to IFAD for no-objection to the activities pertaining to

PPPMER only, and subsequently the modified MOUs.

7. Monitoring and Evaluation. The SPIU is still in its initial stages of setting up an M&E

system. Its M&E Specialist is currently building on existing M&E frameworks of the different

projects to create a single M&E system with planning and reporting templates for all projects.


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73

While there has been no progress in updating the RSME database and filling its data gaps, its use

remained limited. To satisfy its information needs on business development services, the SPIU

will establish a more comprehensive database on RSME service provision countrywide, fed with

gender disaggregated information from the vouchers of the PROBA Scheme, to be provided

monthly by the districts. It is important that this system, including the data to be collected on the

vouchers and the districts‟ role, include the key data collected by the PCU and that it be agreed

before the PROBA Scheme begins.

8. Reporting on gender was observed to be haphazard, depending on individual initiative

rather than an institutional requirement. Where there is gender reporting, it normally stops at sex

disaggregated statistics which are not backed by an analysis of the reasons behind the numbers.

As such, opportunities for learning on gender equality are often missed. It was agreed that

reporting on gender will become a routine requirement. Qualitative analysis should be used to

explain gender differences observed in the quantitative data.

9. Reporting. The PCU periodically reports on its activities through progress reports. The

mission reiterates the previous recommendation that these reports be improved qualitatively by

highlighting key issues and lessons learned, and proposing solutions for the future.

10. Procurement. The mission reviewed the implementation status of the 2010/11

procurement plan and noted some considerable delays in procurement activities. Specifically,

severe procurement delays are noted in the acquisition of equipment for the demonstration units

in fruits processing and beekeeping. More importantly, the mission noted that the performance

guarantee accompanying the latter procurement activities expired on 21 October 2011 and 16

June 2011 respectively. It was agreed that, for delayed procurement, the PCU regularly monitor

such critical contractual elements and ensure that liquidated damages are enforced in case of

late delivery.

11. In response to an audit enquiry, IFAD confirms that all assets procured with project

funds are owned by the government, and that it would be reasonable for the implementing

ministry to continue managing them after project completion.

12. Contract management. The contract register is not updated regularly with some MOUs

included during the period of the mission and columns related to the non-objection and the

Contract Monitoring Forms (CMFs) are not filled in regularly. More importantly, the mission is

concerned with the contract management function as the PCU could not provide the contract

collection in time, thus not allowing the mission to ascertain its completeness. In addition, the

mission noted that the PCU keeps a different format for CMF that does not provide a good

tracking of invoices and performance guarantees. It was agreed that, in order to improve its

contract management function, the project start using the new CMF format and regularly keep

an updated electronic archive of all its contracts and MOUs.

13. Financial progress and status of disbursement. As of 30 September 2011, the project

has disbursed 77% or RWF 8 901 million of the total loan amounting to RWF 11 497 million.

Against the 2011/12 AWPB amounting to RWF 1 968 million, the project disbursements stand at

12.2%. The rate of disbursement stands at 6.5% for component 1 (Capacity building), 13.1% for

component 2 (Support to the SME), 4.7% for component 3 (Support to the MFIs), and 37.7% for

component 4 (Project Management). The preceding AWPB (2010/11) was executed at 75% with

low execution rates noted in Component 1 (18.8%) and Component 3 (52.2%).

14. Status of Liquidity. Based on IFAD records, as at 20 October 2011, the actual total IFAD

loan disbursement up to WA 83 amounted to SDR 9.40 million or USD 15.12 million, representing

88% of the total IFAD loan of SDR 10.65 million. This disbursement includes the special account

allocation of SDR 675 801 equivalent to USD 1 million, and has been reconciled to the IFAD

statement. However, WA 84 amounting to SDR 140.153 is pending in IFAD for settlement and


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74

WA 85 of SDR 203 760 is yet to be submitted. If these WAs are factored in, the effective loan

disbursement would be SDR 9.74 million or 91 % of the loan. Consequently, the projected effective

Loan Account balance is SDR 912 087 equivalent to approximately USD 1.47 million, at the current

USD/SDR exchange rate. However the funds available to the project as at 30 September 2011 are

about USD 1.92 million, including the balance of the project accounts of USD 447 383.

Table 1: PPPMER loan balance and status of liquidity, 30 September 2011

15. Recovery of the Initial Deposit. The mission noted that the threshold for the recovery of the

initial deposit has been reached as the available balance of SDR 912 087 is less than twice the initial

deposit of SDR 675 801. As the available balance of funds has reached the threshold, it was agreed

that, for future WAs, recovery of the special account starts at 50% to allow for a timely recovery of

the initial deposit.

16. Withdrawal application. The mission carried out a random review of expenditure items

from the SOEs supporting withdrawal applications submitted for replenishment of the special

account (see Attachment 1). The review covered WA 80, 82, 83 and 84 submitted to IFAD during the

year 2011. The sample selected was made up of 10 items with a total value of RWF 68 million or

USD 114 208. The expenditures items selected were tested for eligibility including validation with

supporting documents maintained by the PMU. Overall the mission found that all expenditures items

were eligible for replenishment claims to IFAD and were fully documented with supporting

documents.

17. Counterpart funds. With regard to the 2010/11 AWPB, counterpart funds have been

extremely satisfactory as receipts for 2010/11 stood at RWF 270 million or 90% of its planned

budget. However, cumulatively, as of 30 September 2011, government contribution only stands at

RWF 686 million or 51.7% of its planned budget. The mission was informed that the government

allocation for the fiscal year 2011/12 has been set to only RWF 90 million, with RWF 45 million that

are being processed for payment and the other half to be disbursed towards the third quarter. It was

agreed that, considering a potential budget revision in December 2011, MINICOM advocates for an

increase in government’s budget allocation to PPPMER II in order to allow for a timely execution of

the 2011/12 AWPB and to deliver against government’s commitment in the Loan Agreement.

18. Audit. The mission is pleased to note that the 2010/11 audit mission was undertaken in

October 2011 as planned and that PCU has executed the 2009/10 audit recommendations at a rate of

88% as confirmed by the OAG‟s audit query dated 20 September 2011. However it is noted that the

PCU has not implemented recommendations related to compliance to the cut-off principle of

accounting, the management of the BPR credit line and the reconciliation its reports. It was agreed

that the PCU urgently implement the pending 2009/10 audit recommendations, especially the

supervision of the BPR credit line and the reconciliation of its reports.

19. Loan covenants. The Mission reviewed the compliance of the Loan covenants and confirms

that no contravention was noted (see Annex 5).

Category

Number

Category description Financing %Original

Allocation

Disbursement

up to WA 83

WA 84 pending

payment by IFAD

WA 85 to

be

submitted

Balance Disbursement

%

SDR '000 SDR '000 SDR '000 SDR '000 SDR '000

I Civil works 400 341 7 10 42 90%

II Credit 1,230 966 3 6 255 79%

III Equipment and vehicles 900 491 16 23 370 59%

IV Technical assistance 1,830 1,677 38 82 33 98%

V Training & studies 3,005 2,468 30 29 477 84%

VI Operating costs 835 821 5 21 (12) 101%

VII Service providers 1,100 988 7 3 101 91%

VIII Administrative staff salaries 1,130 966 34 28 102 91%

IX Unallocated 220 0 - - 220 0%

Initial Deposit 676 0 0 (676)

Total 10,650 9,394 140 204 912 91%

1,468

447

1,915

In USD '000

+ Balance of accounts as at 30/09/2011

Available balance in USD '000

75

Attachment 1

Review of the Statement of Expenditures (SOE)

RW

AN

DA

: Ru

ral Sm

all and

Micro

En

terprise P

rom

otio

n P

roject (P

PP

ME

R-II)

Follo

w-u

p R

eport