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Rwanda: 2014 Article IV Consultation and Second Review Under the Policy Support Instrument-Staff Report Press Release

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by International Monetary Fund. Afri Dept.
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Rwanda: 2014 Article IV Consultation and Second Review Under the Policy Support Instrument-Staff Report Press Release by International Monetary Fund. Afri Dept.

Context: Rwanda's economic performance since the turn of the century has been remarkable. Strong policies have played a key role in maintaining GDP growth at 7.8 percent on average since 2000, with significant poverty reduction. The economy is recovering from the disruptions induced by aid suspension through mid-2013, with growth bouncing back in the first half of 2014 and inflation well contained. Performance under the PSI has remained strong. All quantitative assessment criteria (QAC) at end-June were met and all but one benchmark observed. Article IV discussions: The discussions focused on near-term policies needed to maintain macroeconomic stability and support growth under uncertain prospects for aid and the global environment; and the government's medium-term objective of sustaining strong, inclusive growth while simultaneously managing a successful transition from a public sector-led, aid-dependent economy to a more private sector-led economy. Policy priorities are mobilizing more domestic revenue, leveraging exports, and removing impediments to private sector development, including by accelerating infrastructure projects and tackling bottlenecks in energy. Outlook and risks: The outlook is positive, with sustained growth projected ahead in response to continued good policy implementation and investment. External risks include a protracted period of slower growth in advanced and emerging economies and weaker than expected export growth. Exchange restrictions and regime: Rwanda has accepted the obligations under Article VIII and maintains an exchange system free of restrictions on the making of payments and transfers for current international transactions. The exchange rate regime is categorized as crawl-like. Key policy recommendations: ? Growth: Prioritize investments to reduce the infrastructure deficit and increase energy generation, thus facilitating private sector engagement and growth. ? Fiscal Policy: Retain the objectives of the FY14/15 budget, anchored on limiting recourse to domestic financing, while keeping the overall budget in line with available resources and protecting priority spending.

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Ebook Details
Pages: 103
Size: 10.6 MB
Publisher: INTERNATIONAL MONETARY FUND
Date published:   2014
ISBN: 9781484355411 (DRM-EPUB)

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