Strengthening resilience through business cooperations

Out of the estimated 123,000 businesses in Rwanda around 98 percent are micro-, small- or medium-sized enterprises, 84 percent of them informal. In many sectors, businesses are struggling with climate-related changes and their impacts, e.g. landslides blocking transport routes, floods disrupting production processes or droughts reducing agricultural yields and energy-supply. Support structures for enhancing resilience among businesses are being developed but are not quite suitable for the needs and capacities of small businesses: financing from climate funds comes in sums that are too large and difficult to acquire for individual businesses, climate information including seasonal forecasts is in need of translation and risk-sharing mechanisms like insurances are scarce.

Given these challenges, this research project investigates how cooperation between businesses has contributed to their resilience in the past and what potentials for increasing resilience cooperation can hold for the future. The analysis will look both at vertical cooperation where larger companies that source materials or products from smaller businesses contribute to the resilience of their suppliers, e.g. by strengthening local infrastructure or providing financing as well as horizontal cooperation between similarly-sized businesses, e.g. through saving schemes or institutionalised sharing of weather-information.

Benefits of cooperation will be analysed in peri-urban and urban areas using interviews and focus groups. The findings will be contrasted with past costs of extreme weather events for businesses. To determine the scope of costs, adelphi and IPAR-Rwanda will carry out surveys with business owners. Results of the research will inform the development of funding programmes on climate change adaptation for businesses in Rwanda as well as adaptation activities of business and urban planning.