KIGALI, Rwanda, January 29, 2015 — Ms. Christine Lagarde, Managing Director of the International Monetary Fund (IMF), issued the following statement in Kigali today at the conclusion of her visit to Rwanda:
“My visit to Rwanda—one of Africa’s economic success stories—has been extremely fruitful and informative. I am grateful for the warm welcome I received and for the time that was given to my visit. I wish to thank President Paul Kagame for meeting with me to discuss Rwanda’s achievements and its outlook. I also want to thank Finance Minister Claver Gatete and Governor John Rwangombwa of the National Bank of Rwanda for their hospitality and insights. I also had the honor to address the National Assembly chaired by Donatille Mukabalisa. I had very interesting meetings with a group of women leaders, as well as visits to the Agaseke Handicraft Project and to the Knowledge Lab at the ICT Hub. My time at Kigali’s Genocide Memorial was profoundly moving.
“Rwanda’s economic achievements are based on real GDP growth that has averaged 8 percent a year over the past decade, subdued inflation, and foreign reserves maintained at adequate levels. This has enabled an impressive performance in reducing poverty, which had declined to below 45 percent in 2010-11 from 57 percent in 2005-06. There has been a notable reduction in income inequality, with the poorest portion of the population seeing significant improvements in their standard of living and social welfare. Fiscal and monetary policies have consistently centered on maintaining macroeconomic stability. The government has sustained efforts to improve public financial management, good governance, and reform the business environment—placing Rwanda among the top African economies in the World Bank’s Doing Business Indicators.
“The challenge going forward is to sustain this strong economic performance while making the transition toward a more self-reliant, private sector-led, and export-oriented economy. Aid flows have declined by about 5 percent of GDP since 2000, and the country is making laudable efforts to mobilize its own domestic resources, which are still low by regional standards. Rwanda is developing policies to facilitate the growth of household enterprises and small and medium sized businesses to foster the transition to a more service and manufacturing-based economy. This is vital given the limited role for agriculture as a significant employer because of Rwanda’s small size. In addition, Rwanda’s export strategy focuses on adding value to traditional exports and moving into new areas.
“The government’s objective of transitioning to a middle-income economy will require steadfast implementation of key policy priorities identified in Rwanda’s economic strategy for 2013-18. This includes a focus on mobilizing more domestic resources, removing impediments to private sector development, and tapping into regional markets. The IMF stands ready to maintain a very close policy dialogue with Rwanda and to provide support through the Policy Support Instrument and extensive, ongoing technical assistance.”
SOURCE: International Monetary Fund (IMF)