Friday, March 29, 2024
Wardheer News
  • Market Bazaar
  • News
  • Slideshow
  • Somali News & Politics

Good policies pay off, visiting IMF director Lagarde says of Rwanda

By: Kenneth Agutamba
The NewTimes

The Managing Director of the International Monetary Fund, Christine Lagarde, will today begin her three day visit to Rwanda, her first since she came to the helm of the institution in 2011. In an e-mail correspondence with The New Times’ Kenneth Agutamba, Lagarde sheds light on her institution’s current relationship with Rwanda and commends the country’s transformative and inclusive policies that have seen a significant decline in poverty levels. Excerpts;-

IMF chief Lagarde
IMF chief Lagarde starts a three-day official visit to Kigali today. (Net photo)

You come here 20 years after the 1994 Genocide against the Tutsi. In your view, what has been the trigger for Rwanda’s rapid economic renaissance?

My main message to Rwanda is that “Good policies pay off.” Let me set this in a broader context by saying that I am very happy to have the opportunity to visit Rwanda at such a pivotal moment in its history. The horrific events that occurred 20 years ago tore the social and economic fabric of the country, and it is uplifting to see the progress in rebuilding, in peace efforts, and in improving the welfare of all Rwandans.

This truly is an example in terms of social and economic transformation. It proves that effective policies and inclusive growth can be transformational.

The economic performance has been remarkable, with strong annual growth for the past 15 years. This has helped Rwanda make progress towards achieving the Millennium Development Goals. The poorest have benefited from a focus on inclusive growth, with the poverty rate falling to 45 per cent of the population in 2011 from 60 per cent in 2000.

Of course, this rate is still high, but it is definite progress and we see the trend continuing. So, while there has not been a magic bullet or a single trigger, a holistic approach, that also included a focus on the agricultural sector, employment, and gender equality, has been instrumental in sharing the fruits of high growth more widely.

What is the status of IMF relations in Rwanda at present?

We have a very close economic policy dialogue and the IMF is currently supporting the government with a Policy Support Instrument (PSI) – designed for low-income countries that have graduated from financial support but still seek to maintain a close policy dialogue.

The PSI signals the strength of a country’s policies to donors, multilateral development banks, and markets. We also provide technical assistance as part of the Fund’s efforts to increase local capacity and know-how. We have an office in Kigali, where a resident representative, currently Mitra Farahbaksh, ensures our presence in the field.

Rwanda’s PSI, which is in its second year, supports Rwanda’s own policy priorities for strong and inclusive growth, with an emphasis on domestic resource mobilization, private sector development, export diversification, regional integration, and financial sector development.

We recently reviewed this programme and welcomed the country’s continued strong performance. We also agreed with the government that more work needs to be done to further reduce Rwanda’s reliance on aid and increase its resilience to external shocks.

What is your economic outlook for the country between now and 2020?

Our outlook for Rwanda is positive. The economy is recovering from a weak performance in agriculture and delays in related project implementation in recent years. Growth rebounded last year and inflation remains well contained. We expect GDP growth rates to rise gradually towards 7-7.5 per cent in the medium term, while inflation remains within the medium-term target of 5 per cent.

I am particularly impressed with the government’s continued commitment to poverty reduction.

As part of my stay here, I will be visiting the Agaseke Handicraft Cooperative and the ICT hub (knowledge Lab) in Kigali to see firsthand how the government has managed to improve the welfare of vulnerable and disadvantaged groups such as women and youth.

As your readers are aware, the Economic Development and Poverty Reduction Strategy for 2013–18 focuses on economic transformation, rural development, and youth employment. The strategy is rightly aimed at further reducing poverty.

I think that the continued rollout of planned measures and the successful inclusion of the private sector in leading economic development will help make sizeable inroads in making growth even more inclusive and in reducing inequality.

Read more: visiting IMF director Lagarde

Source: The NewTimes

Leave a Reply

You must be logged in to post a comment.