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Rwanda: Third Review Under the Policy Support Instrument-Press Release and Staff Report

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by International Monetary Fund. Afri Dept.
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Rwanda: Third Review Under the Policy Support Instrument-Press Release and Staff Report by International Monetary Fund. Afri Dept.

KEY ISSUES Main challenges: Rwanda continues to face the challenge of sustaining high growth in a context of uncertain donor flows, while avoiding the build-up of imbalances. Efforts to mobilize domestic revenue need to be reinvigorated, while judiciously using the limited borrowing space to finance priority projects and maintain debt sustainability. Outlook and risks: Growth is projected to moderate to 6.5 percent in 2015, with inflation well contained on account of the lower food and oil prices. The overall outlook is stable, but downside risks emanate from shocks to agriculture, lower export growth, and delays in donor disbursements. Policy discussions focused on the short and medium-term economic challenges: • In the short term, fiscal policy will need to support growth and accelerate measures to mobilize domestic revenue. The tight monetary stance remains appropriate given risks to the inflation outlook and the balance of payments. • In the medium term, the challenge remains that of continuing Rwanda’s transition from a public sector-led, aid-dependent economy to a more private sector-led economy. Faced with large investment needs and limited debt space, policy priorities are mobilizing more revenue, accelerating export growth, and removing impediments to private sector development. Management of the public investment program needs to be strengthened at all stages to contain fiscal risks and safeguard debt sustainability.

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Ebook Details
Pages: 62
Size: 3.9 MB
Publisher: INTERNATIONAL MONETARY FUND
Date published:   2015
ISBN: 9781513519456 (DRM-EPUB)

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01/18/2017
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