Resources and Their Usage
Senior 3 · Entrepreneurship
Resources and Their Usage
Lesson 3 of 4
22 min
Read these figures from the Rwanda Development Board (RDB):
No one in Musanze owns a mountain gorilla, and the animals do not work for anybody. Yet they help to pay guides’ wages, lodge owners’ profits, government revenue and a share of the classrooms and water taps in nearby sectors. That is what this lesson is about: why resources matter to a person, a business, a community and a country.
Definition
Value addition: changing a resource or product (by processing, packaging, transporting or improving it) so that it is worth more than before.
Foreign exchange: the currencies of other countries, such as US dollars and euros, which a country earns from exports and tourism and spends on imports.
Example: roasting and packing coffee in Rwanda adds value to the beans; selling that coffee abroad, or a gorilla permit to a visitor, earns foreign exchange.
| Level | Importance of resources | Example |
|---|---|---|
| Individual and household | meet basic needs (food, shelter, water); give income through work; build skills and self-reliance; raise the standard of living | a guide’s wages pay school fees and health insurance |
| Business | make production possible; create goods and services to sell; earn profit; allow growth and new products; give an advantage over competitors (a rare skill, a good location) | a lodge uses the scenery, trained staff and a building to sell nights of accommodation |
| Community | jobs close to home; shared facilities; markets for local farmers and craftspeople; reason to protect the environment | a cooperative sells baskets and vegetables to lodges |
| Nation | production and economic growth; exports and foreign exchange; tax and non-tax revenue for public services; energy and food security; employment; less dependence on imports | tourism revenue, mineral exports, locally made goods |
The diagram shows how the benefit of a natural resource can travel. The last arrow is the one people forget: when communities gain, they protect the resource, and the cycle can continue for generations.
A resource is worth most to a country when it is processed where it is found. Raw coffee cherries, raw hides or raw minerals sold abroad earn a little; the same resources washed, tanned, smelted, roasted, sewn or packed in Rwanda earn more, and each step creates jobs and skills at home. This is the idea behind Made in Rwanda: using local resources to make goods locally means the country pays for fewer imports and keeps more foreign exchange.
Having resources is not enough on its own. A country can own fertile land and minerals and still be poor if its people lack the skills, capital, technology and organisation to use them well. Entrepreneurs are the link: they see a resource, add skill and capital, and turn it into something customers will pay for.
Tip
Exam technique. “Explain the importance of resources” questions are often marked per level. Organise your answer under headings (individual, business, community, nation) and give one explained point with a Rwandan example under each, rather than eight points about the nation only.
Worked example 1: value added along a coffee chain
The table follows 1,000 kg of coffee cherries through three businesses. Bought-in inputs are materials and services bought from outside the business. Calculate the value each business adds and the total.
| Stage | Sells | Sales (Frw) | Bought-in inputs (Frw) |
|---|---|---|---|
| Farmer | 1,000 kg of cherries | 400,000 | 60,000 (fertiliser) |
| Washing station | 180 kg of parchment coffee | 540,000 | 400,000 (cherries) + 20,000 (water, power) |
| Roaster | 480 bags of roasted coffee | 1,680,000 | 540,000 (parchment) + 240,000 (bags, fuel) |
Step 1: value added = sales minus bought-in inputs.
Farmer:
Washing station:
Roaster:
Step 2: total. Frw.
Step 3: interpret. The roaster adds the most value. If the cherries were exported raw, Rwanda would keep only the farmer’s share; processing at home keeps Frw more in the country, as wages and profits. All prices and quantities are illustrative.
Worked example 2: sharing the benefit
Suppose that in one year the national parks near a group of sectors earn Frw 4,800,000,000, and 10 per cent is shared with the surrounding communities, as in the Tourism Revenue Sharing Programme. If a health centre costs Frw 240,000,000, how many could the share pay for?
Step 1: the share is Frw.
Step 2: health centres.
Step 3: interpret. The resource pays for public goods that no single family could afford, which gives every household a reason to protect the park. The park income and the cost of a health centre are illustrative; only the 10 per cent is RDB’s figure.
Warning
Common mistake. “A country with many natural resources will be rich.” Not automatically. Resources create wealth only when people have the skills, capital, technology and good management to use them, and when the resource is not used up faster than it can be replaced. Always add the condition when you write about importance.
How Tourism revenue sharing scheme has transformed communities around Volcanoes National Park, a news report from RwandaTV (RBA), 2020 (under 3 minutes). Listen for what residents say the shared revenue has paid for, and what they do in return.
Practice
Sources and credits
Written by Ganzaa: the table of importance, the resource-cycle diagram, the worked examples and the practice items. The coffee chain, the park income and the health-centre cost are illustrative (2026).
This lesson adapts CC BY-SA material and is shared under CC BY-SA 4.0.
