Author: John Mbaraga

In May, the Minister of Finance and Economic Planning, Dr. Uzziel Ndagijimana presented to both chambers of parliament, the Budget Framework Paper (BFP) and the midterm budget estimates for 2017-2018/2019.

Ndagijimana said that the government will continue to promote import substitution and diversify exports with the aim of reducing the exposure to external shocks and imbalances over the medium term.

“The implementation of Made in Rwanda policy will continue to play a key role in narrowing the current account deficit in the short to long run and help to consolidate private sector domestic activities, create jobs and boost economic growth,” Ndagijimana said.

Key targets and interventions will include growing traditional exports, promoting non-traditional exports, growth of the service sector as well as cross cutting interventions such as promotion of made in Rwanda, developing of cross border and trade logistics infrastructure and development of industrial parks among others.
Proposed 2018/2019 Budget

The proposed total budgeted resources for fiscal year 2018/19 amount to Rwf2,443.5 billion, which is Rwf328.2 billion higher compared to Rwf2,115.3 in the 2017/18 revised budget.

The 2018/19 domestic resources are projected at Rwf1,646.4 billion, representing 67% of the total budget.

Total tax revenues are projected at Rwf1,353 billion, non-tax revenues at Rwf155.7 billion, Domestic Borrowing is projected at Rwf129.1 billion while Rwf8.6 billion will come from the use of government deposits.

External grant is estimated at Rwf396.3 billion while total external loans are projected at Rwf400.9 billion. Domestic resources and external loans will account for 84% of the total budget while 16% will come from grants which is in line with government of Rwanda’s ambition of self-sustenance.

On the expenditure front, the recurrent budget is projected at Rwf1,305.7 billion while development expenditure is estimated at Rwf897.1 billion. Net lending is projected at Rwf190 billion which will be used to finance key government projects such as the construction of Bugesera airport, expansion of Rwandair operations, export promotion activities among others. Rwf27.2 billion will be used for payment of arrears while Rwf23.5 billion will be used to accumulate government deposits.

The allocation of resources in the budget for 2018/19 fiscal year and the medium term is guided by interventions in National Strategy for Transformation.

These will include creation of off-farm Jobs, promotion of urbanization to enhance economic transformation, promotion of competitive knowledge based economy, industrialization and export promotion, domestic savings promotion, increased agriculture and livestock production and productivity, sustainable management of Natural resources among others.

{{People speak}}

Different people who spoke to IGIHE suggested that the government would increase the budget allocated in small enterprises making local products which would also help to create many jobs.

Gloriose Umutesi, the founder of Shallon Fashion, a shop that makes different handicrafts products including carpets, bags, indoor shoes and other clothes says that the budget should consider increasing the promotion of Made in Rwanda products.

She says that the people engaged in the sector have no access to the loans for them to be able to add value for their products.

“We would request advocacy from officials so that we have full access to loans which would help us produce enough stuffs. They should also advocate for us to have more the markets for our products,” she said.

Emmanuel Abarikumwe, Talon Minutes Ltd owner, an enterprise that makes leather shoes says that in the budget, officials should consider constructing the plant that makes leather products.

He said that they import all materials used to make shoes are imported from Kenya.

“We wish that they could construct a plant that makes leather products. All products are imported from Kenya. So, at the end we produce shoes which are so expensive and people do not like them,” he said.

He said that as their products are expensive, they are incapable to expand the market so that they can export.

Francois Mutarambirwa, a university graduate said that the Government should increasing the resources allocated in the well-being of people.

“By doing so, they have to reduce poverty through agricultural activities since the financial income and well-being of people are mainly supported by this sector. And 80% of Rwandans are in agri-business,” he said.

He said that in a way to uplift the welfare of population, the budget allocated to infrastructure should also be increased. He said that water and electricity should reach all people.

Mutarambirwa also suggests that the budget should also consider creating more jobs for youth to get employment and reduce unemployment rate.

“They should consider allocating increased budget in job creation. Leaders should also bear in mind new business creation which goes along with job creation,” he suggested.

Aime Sandrine Uwambaje, the Executive Secretary of Gikondo Sector of Kicukiro said that the budget for planned activities on sector level is enough.

“The budget is allocated based on planned activities in different sectors like good governance, economic development and social welfare; all activities that were planned in four government pillars have enough budgets. But, if they plan more activities, they should increase the budget,” she explained.

Kagame chaired the meeting in Addis Ababa, Ethiopia. The meeting followed Consultation Meetings on AU Reform involving the Group of 15 Foreign Ministers and Heads of Regional Economic Communities.

The meeting was also attended by President of the Republic of Congo, Denis Sassou Nguesso.

Kagame commended the Chairperson of the AU Commission, Moussa Faki Mahamat and his staff for excellent preparatory work they have undertaken in collaboration with Policy Organs and institutions of the African Union.

“Today’s meetings represent a turning point in the process of implementing the Reform and Financing Decisions. As decided at the Summit in January, continuous consultation, communication, and fine-tuning are necessary and beneficial,” Kagame said.

He also thanked the Group of Fifteen Foreign Ministers as the advisory body that will accompany the Assembly and the Commission in the task. “So, I want to thank you for treating this with importance, as it should be,”

Kagame said that the fundamental task of defining the division of labour between the Commission and the Regional Economic Communities must be based on solid analysis and clear consensus.

“There are no obstacles that are going to be insurmountable because we have to keep going forward for the future of our continent. That is why we thought it useful to invite both groups to spend this day together in deliberation and exchange,” he added.

With support and engagement at every level, Kagame said that the ultimate success of the reform is assured, with all the benefits Africa will gain as a result.

“My intention is therefore that this meeting be an open exchange of views, as to how we can continue moving forward,” he urged.

On African Day that was celebrated on Friday, Kagame said that it is the spirit that guides Africans, but, is also a day that reminds them on important task ahead of them to conduct.

The instruments were presented to Mahamat by the Minister of Foreign Affairs, cooperation and East African Community Affairs, Louise Mushikiwabo.

Rwanda becomes the third member state to ratify the AfCFTA, after Ghana and Kenya; and the first to do so as far as the Protocol on Free Movement of Persons and the African Passport is concerned.

Mahamat commended Rwanda for the important step, which he described as a further illustration of its leaders’ commitment to the goals and ideals of the African Union.

He urged the member states yet to do so to take the required steps to become parties to both the AfCFTA and the Protocol on Free Movement of Persons and the African Passport.

The Continental Free Trade Area is a continent-wide free-trade agreement brokered by the African Union and was signed by 44 of its 55 member states in Kigali on March 21, 2018.

The agreement initially requires members to remove tariffs from 90% of goods, allowing free access to commodities, goods, and services across the continent.

The United Nations Economic Commission for Africa estimates that the agreement will boost intra-African trade by 52 percent by 2022.The proposal will come into force after ratification by 22 of the signatory states.

The three-year partnership, according to RDB will see the new “Visit Rwanda” logo featured on the left sleeve of all first team, under-23 and Arsenal Women’s matches from the new season starting in August.

The deal will among others highlight Rwanda’s tourism offerings such as the National Parks, which are attracting number of tourists due to growing numbers of wildlife including black rhino, lions, zebra, chimpanzees and the famous mountain gorillas, as well as the investment opportunities in the country.

Different people took on social media praising the deal as forward looking initiative, while on the other side critics were raised saying that it was not priority for a developing country like Rwanda.

Though RDB did not reveal the value of the deal, Dutch MPs wondered why a country which receives so much aid from the Netherlands is able to invest €30 million in sponsoring Arsenal’s shirts.

MPs tasked Netherlands Minister of Aid to raise the issue with Rwanda. They criticized the deal saying that it is disheartening to see such payments being made, while the international community is trying to tackle the poverty.

{{Rwanda casts-off the critics }}

The State Minister in the Ministry of Foreign Affairs, Cooperation and East African Community Affairs, Amb. Olivier Nduhungirehe took on twitter that the deal is not part of Netherlands MPs’ business.

“Dear MPs from The Netherlands. This is none of your business. Rwanda uses revenues from National Parks to promote investment and tourism, aiming self-reliance,” reads the tweet.

He said that Rwanda will talk business with the Netherlands teams once they will have popularity like Arsenal.

“The day AFC Ajax or Feyenoord Rotterdam get a similar popularity worldwide like Arsenal, then we will talk business!” he said.

According to RDB Chief Executive Officer, Clare Akamanzi whoever criticizes the deal doesn’t understand the context of marketing in business.

“Anyone who criticizes our deal with Arsenal on account of Rwanda being poor or an aid recipient, either wishes for Rwanda to be perpetually so, or doesn’t understand that in any business, marketing costs are a key component of a company’s expenditures,” she said in a tweet.

“The Rwanda Development Board generates revenues from sale of tourism products, from which it uses a portion to market its products for further growth. The Arsenal deal falls within this arrangement, just like our tourism exhibitions, sales consultancies,” she added.

She said that $800 targeted million from tourism revenues cannot be achieved miraculously.

“Our national goal is to double tourism revenues to $800m by 2024, from $404 million currently. This won’t happen by sitting and waiting, but by being proactive, and marketing Rwanda as a tourist destination in innovative ways. Now- Relax and let the world Visit Rwanda,” she emphasized.

{{How tourism promotion will impact the lives of Rwandans? }}

According to RDB, the Arsenal Football Club partnership is part of Rwanda’s long-term tourism development and conservation strategy that is grounded in Vision 2050 and EDPRS II. As part of this strategy Rwanda has upgraded its conference and hospitality infrastructure, transport networks, tourist attractions and conservation policies.

Rwanda is today ranked third most popular destination in Africa for hosting international meetings and events by the International Congress and Convention Association (ICCA).

National carrier, Rwandair, now flies to 26 destinations globally. In addition, the Akagera National Park has been restocked with lions and Black Rhinos in order to make it a Big 5 park and the Volcanoes National Park has been expanded in order to create additional habitat for the endangered mountain gorilla. Today, tourism is Rwanda’s largest foreign exchange earner and has generated over 90,000 jobs so far.

Tourism has played a major role in helping the local community. One of the major tourism initiatives was the Revenue Sharing Programme that was initiated in 2005 by the Government of Rwanda.

The Revenue Share program aims to guide investment in the areas surrounding the various national parks in Rwanda.

Over USD 1.28 million has been distributed by the Rwanda Development Board to more than 158 community-based projects. These projects have availed clean drinking water, health centers, classrooms and housing to members of the communities living around the three national parks; Akagera National Park, Nyungwe National Park and Volcanoes National Park.

Kagame was given the cow in a colorful State Banquet hosted by Abiy in Ethiopia yesterday.

Speaking at the Banquet, Kagame congratulated Prime Minister Abiy for being the leader he deserves to be. He said that the trust and confidence put in him by Ethiopians was for a good reason.

Kagame said that being in Ethiopia was a very pleasant time of connecting heart to heart.

“This means we will be back many other times and for longer. We hope to see the Prime Minister, regional leaders, other leaders, brothers and sisters visit our country,” he said.

At the event, Abiy presented a cow and its calf to Kagame and described them as a great gift.

“I cannot thank you enough, it has been a great moment for us, we can only move forward hand in hand and work together. Thank you for the nice gift. I may stay in it for many more hours and days,” Kagame said.

“Thank you for the great gift that touches right to the heart of who we are and the many things in our culture which we share. This is a very nice cow and its calf, it will increase the size of my herd and will have a special position,” he boasted.

At the event Kagame also presented a dance portrait to Abiy as his gift.

“This is a dance picture – traditionally it is called a warrior dance; when you have a herd of cows or are a leader of a nation, you have a warrior and leadership spirit but you also need to enjoy the pleasure of dancing,” Kagame described the picture.

Kagame arrived in Ethiopia on Thursday and was received by Prime Minister Abey.

Yesterday, both Heads of States hold bilateral talks in Addis Ababa and toured Hawassa Industrial Park.

Abiy was speaking yesterday in Ethiopia, in a State Banquet he hosted in the honour of President Kagame.

He said that Kagame leads the continent in great, wise and miraculous ways.

“President Kagame is not only the President of Rwanda but he is also leading the continent in great, wise and miraculous ways of transforming the continent and economic integration, as well as realising the vision of our forefathers,” he praised.

Abiy promised Kagame to wave visas on people entering Ethiopia.

“The President invited all Africans to travel to Rwanda without visas, we will follow you very soon,” he said.

According to Abiy, Kagame is a great gift for the people of Rwanda and for the continent.

“President Kagame is a freedom fighter, great gift for the people of Rwanda and for the continent. After fighting for freedom it is difficult to establish institutions, but when you go to Rwanda you can see how this leader has changed the country,” he added.

“I am grateful to have President Kagame here in Ethiopia, we will continue working together, we have many great visions to disrupt this continent,” Abiy said.

In the event, Heads of States exchanged gifts, where Abiy gave a cow to Kagame and Kagame gave a dance portrait to Abiy.

As part of the three-day state visit, Kagame and Abiy held bilateral talks in Addis Ababa yesterday and toured Hawassa Industrial Park.