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Mainstreaming and financing climate change adaptation in Rwanda

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Institution
Paul Watkiss Associates
Author(s)
Blanche Butera and Paul Watkiss
Published
Topic Area
Financing the green and resilient transition
Question
How can Ministries of Finance help finance investment in the green transition?
Citation

Paul Watkiss Associates (2025) Mainstreaming and financing climate change adaptation in Rwanda, Contribution to ‘Compendium of Practice from a Global Community of Ministries of Finance and Leading Organizations’, Coalition of Finance Ministers for Climate Action

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Rwanda has one of the most advanced climate policy landscapes and provides a useful case study on climate mainstreaming and finance.

Following a study on the economics of climate change in 2009, Rwanda developed a Green Growth and Climate Resilient Strategy (GGCRS) in 2011. This led to a set of climate mainstreaming initiatives: integrating climate change into the medium-term development plan and sector strategic plans; developing a climate mainstreaming strategy; including climate mainstreaming indicators in the annual Planning and Budget Call Circular; and implementing climate budget tagging into the national accounting system.

Key Messages

  • The National Strategy for Transformation (NST1) (2017–2024) prioritized climate change and the environment across sectors, with a set of associated key performance indicators. This approach has been continued and further advanced in the revised GGCRS (2024) and the new NST2 (2025–2030).
  • The GGCRS also led to the setting up of a National Fund for Climate and Environment (FONERWA) in 2012, now called the Rwanda Green Fund. The Fund issues regular calls for proposals and has so far funded over 50 projects.
  • Recently, the Fund evolved into two facility strands. The first is the NDC Facility (Intego), which continues the public sector–oriented fund, focusing on the implementation of Rwanda’s updated NDC and its mitigation and adaptation priorities. The second is the Rwanda Green Investment Facility (Ireme Invest), which is a blended facility model set up to develop new financial instruments to support and de-risk private sector investment. It includes a project preparation facility (PPF) led by the Rwanda Green Fund that provides grants and recoverable grants, and a credit facility led by the Rwanda Development Bank to provide concessional loans and bank guarantees.
  • In 2022, Rwanda was the first African country to be approved for the IMF Resilience and Sustainability Facility (RSF), with an arrangement of US$319 million. This is aimed at advancing Rwanda’s resilience, including through public financial and investment management reforms, and at supporting the National Bank of Rwanda to strengthen its climate change policy. The Rwandan Ministry of Finance and Economic Planning (MINECOFIN) developed a Climate and Nature Finance Strategy (CNFS) and is in the process of setting up a designated climate finance unit to support climate-resilient and low-carbon development and investments at scale. Additional recent initiatives include the announcement of a Green Taxonomy (2025), Sustainability-Linked Bonds, and the development of a Carbon Market Framework.
Keywords
climate financefinancial instrumentspolicy processsector pathwaystransition