Category: Economy

Rwanda economy to grow by 6.3% in 2016

The National Bank of Rwanda (BNR) has observed that with the low economic performance and falling of international prices of commodities that Rwanda exports will mean a low pulse of growth.

The governor of BNR, John Rwangombwa said that banks continue to be among the top of sectors boosting Rwanda’s economy. The later occupies 67% of Rwanda financial markets leaving 17.1% for insurance companies and 6.6% for micro finance institutions.

“Rwanda’s economy had a good performance in the first three trimesters of 2015, realizing an increase of 6.1% in the first trimester, 7.1% in the second and 7.6% in the third trimester,” he said.

Economic indices indicate that economic growth reached at 7.0 % in 2015 and in 2016 BNR expects the economic growth at 6.3%.

Devaluation of US dollar to Rwandan franc hit an all time low at 7.6% in 2015 from 3.6% in 2014 while the cost of one dollar rose from Rwf 649.37 to Rwf 747.41.
“It is the first time Rwanda Franc lost value in such way in the past ten years.

However, the situation is not critical compared to neighboring countries in the region,” he said.

The Euro gained against Rwandan Franc by 3.2% and the British Pound Sterling by 2.8%. Compared to Kenyan and Ugandan shillings Rwandan franc gained weight against Kenya Shilling by 4.6%, 13.5%to Ugandan shilling.

February 23, 2016
Lake Kivu illegal fishing methods decimate schools of fish

Fishermen on Lake Kivu on the Rwanda side of the shores in Nyamasheke district, have expressed concern over the declining catch due to use of poisonous traps by their Congolese counterparts, a method that is negatively impacting aquatic life.

Some fishermen in Nyamasheke have also been sighted in the practice.

“Illegal fish traps have been reduced among Nyamasheke residents, but are still rampant among Congolese who illegally fish from the Rwanda waters,” said Alex Nshimiyimana, one of the fishermen, requesting for intervention from authorities.

The president of Lake Kivu Fishers’ Association, Eliezel Ndahayo said that the illegal traps mostly affect small fish populations.

“The illegal fishing methods are a menace to the entire industry which have been eradicated from seven of the ten sectors of Nyamasheke that touch the Kivu shoreline. The problem now remains with handling Congo fishermen,” he said.

Nyamasheke is among the five Rwanda districts bordering Lake Kivu.

February 22, 2016
Tanzania:State set to increase revenue collection

The Deputy Minister for Finance and Planning, Dr Ashatu Kijaji, has emphasized on the fifth phase government intentions of increasing tax collections in order to improve social services as well as the well being of Tanzanians.

Due to strategies the government has in increasing tax collection, she said her ministry will not tolerate any civil servant at any level within the ministry who will not fulfill his or her responsibility to the required level in accordance with the public ethics.

Dr Kijaji made the statement in Morogoro yesterday during her speech while opening the third meeting of the second Tanzania Institute of Accountancy workers’ general council.

She urged civil servants of the institution and others in the government especially in her ministry to work diligently knowing that they have been granted with a duty to serve the public.

“Every civil servant on their position should serve with their best in order to solve the problems facing the general public. It is not a pleasant thing and not fair to find the director’s table full of magazines and books while his subordinates relax with nothing to do while the people stand in long queues waiting for services,” she stressed.

She said workers should be given enough training to acquire enough experience as the institute managers have. On his part, the TIA Executive Director Dr Joseph Kihanda said they have been delivering the best services and they teach their students to abide on their code of ethics when employed.

He pointed out challenges facing the institution which include shortage of infrastructure and revealed that for over eight years the institute has been asking for subsides for its development projects but they have not received it yet.

“Moreover we face a shortage of manpower, and we are kindly requesting for financial assistance to solve these problems facing the institute in order to deliver best services,” Dr Kihanda said.

Source:Daily News:State set to increase revenue collection

February 20, 2016
Raise maize prices—farmers

Maize farmers say the price tagged to a kilogram of maize is not in commensurate with the efforts expended in the growing the crop.

This manifested yesterday during talks held between the Ministry of Trade and Industry, Ministry of Agriculture and Animal Resources, representatives of maize farmers’ cooperatives and institutions in charge of buying maize harvest seeking together how to collectively find markets without hurdles.

Members of the Rwanda Grain and Cereals Corporation (RGCC) explained that it doesn’t pay below Rwf 170 or 180 depending on the quality of maize adding that the price is determined based on information from farmers.

“We first talk to farmers before signing agreements with their cooperatives to buy available harvest,” said Bahati Wenceslas, the CEO of RGCC.

East African Commodity Exchange also said that they pay between Rwf 160 while the and 185 depending on maize quality.

The president of Rwanda maize farmers association, Evariste Tugirinshuti said that the price does not match efforts of farmers and requested to raise the price to Rwf 200.

“We have realized that a farmer invests between 145 and 163 per kilo. We would rather a farmer be paid Rwf 200 to avoid losses,” he said.

The Minister of Trade and Industry Francois Kanimba said that the price ceiling for maize is Rwf 170 per kg.

“We sat together with farmers’ cooperatives and produce buyers. We realized that the investment of a farmer ranges between 120 and 140 per kilo and confirmed that the price must not go below Rwf 160,”he said.

He said that paying a farmer between Rwf 170 and Rwf 180 ensures that they do not incur losses. Maize from Uganda, he said, is bought at between Rwf 170 and Rwf 180 per kilo.

The Ministry of Agriculture revealed that 908,723 tons of maize are expected in the agricultural season 2016 A.

February 18, 2016
Venezuela hikes petrol prices sixty-fold

President Maduro devalues currency and hikes petrol prices for first time in decades in attempt to shore up economy.

Venezuela’s president announced a currency devaluation and ramped up its petrol prices for the first time in about 20 years on Wednesday in an attempt to shield the country’s oil-dependent economy from collapse.

President Nicolas Maduro announced that the pump price of premium gasoline would jump from just under 0.1 bolivars per litre to six bolivars – a 60-fold increase from its current level.

“This is a necessary action, for which I take responsibility,” Maduro said in a televised address.

“The time has come to establish a system that guarantees access to hydrocarbons at a fair price but that also guarantees the funding of investment in producing that gasoline.”

Maduro also announced that the strongest of the country’s official exchange rates, used for essential goods like food and medicine, would weaken to 10 bolivars per dollar from 6.3.

Venezuela has the biggest known oil reserves in the world and has been practically giving gasoline away in recent years. But it has suffered from plunging world oil prices since mid-2014.

Sparking protests

The move risks sparking protests in a volatile country where citizens are struggling with soaring inflation and shortages of basic goods such as cooking oil and toilet paper.

A petrol price increase in 1989, which came at a time of economic crisis driven by low oil prices, spurred popular outrage that erupted into days of rioting that killed hundreds.

A subsequent increase in 1997 did not lead to protests, but late President Hugo Chavez nonetheless kept prices fixed during his 14 years in office even as high inflation eroded the value of fuel.

Political survival

The economic measures come as Maduro fights for his political survival. Opposition leaders quickly dismissed Wednesday’s measures as insufficient to right the flagging economy.

Oil accounts for 95 percent of Venezuela’s export earnings, and plummeting world prices have helped push its state-led economy into a deep recession, with chronic shortages, empty store shelves and soaring inflation.

Opposition leaders took control of Congress in January for the first time in more than a decade and have been on a collision course with the socialist president ever since.

Source: Al Jazeera:Venezuela hikes petrol prices sixty-fold

February 18, 2016
Minister accuses RAB of falling short on research

The Minister of Agriculture and Animal Resources, Dr. Gerardine Mukeshimana, says that the widening challenges in the agriculture sector are emanating from especially climate change and decline in agricultural research.

Dr. Mukeshimana explains that agriculture was mostly affected by climate change where strange pests and insects emerged and spread crop diseases. General decline in research, especially when Rwanda Agricultural Research Institute (ISAR) was phased out and replaced with Rwanda Agriculture Board (RAB) has also fed into poor crop performance.

“The research severely declined. Most of the challenges result from inadequate performance of RAB; they did not produce improved seeds and fertilizers successfully, neither did they carry out research on current crisis to provide a remedy,” she said.

The minister says that they are putting in more efforts to promote research as a way of sustainably attaining good harvest.

Over 11 million Rwandans depend on agriculture and animal husbandry representing 85% of the population.

The budget reserved for agriculture has been increased from Rwf 90 298 698 305 billion in 2013/2014 to Rwf 102,870 277 395 billion in 2015/2016 national budget. However, last year the sector faced the effects of pests and diseases damages that immensely affected crop performance.

February 17, 2016
Acute lack of market centers worries Nyamasheke farmers

Residents of Nyabitekeri sector in Nyamasheke district say they have a fertile land, get good yields per unit area, but are faced with acute lack of market centers from where they can sell their produce. The old market they used to work from is no longer operating well.

Talking to the media, the residents said that they used to sell their food commodities from Nyamitaka market which was mismanaged. They say, local leaders on a number of occasions intermittently closed the market center and clients tended towards ignoring it in the long run. Today, clients go to distant markets, taking them about three hours reach.

“A pool of sellers attracts a pool of buyers who used to come early in the morning. However the situation has changed since the first seller reaches the market center at 1:00 pm,” said Dunia one of the market vendors.

“In the past, Congolese would come in Nyamitaka to buy food and other items but they no longer come; instead they go to Mukoma small market,” said another resident.

The administration of Nyabitekeri sector says that the former market will soon become a big trading center and port.

“You have seen that the Nyabitekeri market is located only five meters away from Lake Kivu. We want to make this location a port and relocate the market somewhere else,” said the executive secretary of Nyabitekeri sector, Niyonzima Jaques.

Residents do complain of traveling long distances that take them three hours to the markets in Bushenge sector or cross the lake heading for Resero market located in Kagano sector.

February 16, 2016
Japan sees economy shrink more than expected

The contraction of 1.4 percent deals blow to PM Abe’s bid to revive the world’s third economy through stimulus policies.

Japan’s economy has shrank more than expected in the final quarter of 2015, dealing another blow to Prime Minister Shinzo Abe’s faltering bid to revive the world’s number three economy.

Falling consumer spending and exports made the economy contract by 1.4 percent in October-December compared to the last quarter of 2014, official data showed on Monday.

The slump was bigger than the forecast 1.2 percent shrinkage.

The data underscores the challenges Abe faces in dragging the out of stagnation, as exports to emerging markets fail to gain enough momentum to make up for low domestic demand.

With his stimulus policies that gave big manufacturers windfall profits, Abe had hoped to generate a positive cycle in which companies raise wages and help boost household spending.

Instead, the data showed that private consumption, which makes up 60 percent of the economy, fell 0.8 percent, exceeding market forecasts of a 0.6 percent decline.

‘Moderate recovery’ expected

Economy Minister Nobuteru Ishihara told reporters after the data was issued that the economy would head for a moderate recovery as its fundamentals remained strong.

Exports fell 0.9 percent in October-December after rising 2.6 percent in the previous quarter, underscoring the pinch companies are already feeling from soft emerging market demand.

Last month the Bank of Japan (BOJ) unexpectedly cut a benchmark interest rate below zero, stunning investors with another bold move to stimulate the economy as volatile markets threatened its efforts to overcome deflation.

However, the shock move has failed to boost Tokyo stock prices or weaken the yen as Japanese markets remained at the mercy of a global equity sell-off, bolstering a view among investors that the BOJ is running out of policy options.

Source: Al Jazeera:Japan sees economy shrink more than expected

February 15, 2016
Rwanda earned over Rwf 25 billion from car taxation in 2015

Last year 7,262 cars worth Rwf 62,795,837,834 were imported to Rwanda and paid over Rwf 25 billion in taxes.

Rwanda Revenue Authority (RRA) says that most of the imported cars were bought on second hand market.

In an interview with IGIHE, RRA has said the imported vehicle categories included tractors, 381 having the capacity to carry more than 10 passengers, 5,498 reserved for public transport , 1,238 for cargo while other 73 cars were ordered for particular purposes.

Raphael Tugirumuremyi, the RRA Deputy Commissioner General in charge of customs said the cars have the value of more than Rwf 62 billion and have paid over Rwf25,358,220,188 billion in taxes.

It was resolved by the regional council of ministers of trade held on 22nd May 2015, countries have agreed on the increase of taxes on second hand cars.

The new measures put into consideration the value in the year of manufacturing, depreciation which is calculated at; 20% after one year, with five years a car loses 55%, six years 60 %, seven years 65%, eight years 70%, 75% at nine years while all cars bought after ten years of manufacturing lose value of 80%.

February 13, 2016
Iran set to negotiate on oil market with Saudi Arabia

With sanctions lifted, Tehran is entering an already-glutted market as it plans to produce 500,000 barrels a day.

Iran’s Oil Minister Bijan Zangeneh says his country is ready to negotiate with Saudi Arabia and other OPEC members over the dire conditions in international oil markets.

Tehran recently resumed oil exports after Western sanctions over its nuclear programme were lifted, and announced it plans to produce 500,000 barrels a day.

The move will add significant pressure on an already oversupplied market, as the Organization of the Petroleum Exporting Countries continues to refuse to cut its production.

“We support any form of dialogue and cooperation with OPEC member states, including Saudi Arabia,” Zangeneh told reporters.

The Iranian oil minister said in early January that certain countries’ insistence on overproduction was politically motivated.

“If there were a strong political will, the price of oil would have been balanced within one single week,” Islamic Republic News Agency (IRNA) quoted him as saying.

“None of the oil producers is happy with the existing prices, which will harm suppliers in the long term.”

Zangeneh added that Iran needs as much as $200bn in investments to revamp its oil industry.

The global oil sector has taken a beating since the summer of 2014, losing about 70 percent of its value. OPEC countries have refused to budge on the flooded market, keeping in place a 30 million barrel a day production ceiling.

Another senior Iranian official said on Wednesday the country cannot cut crude oil production because it needs to regain market share and return to pre-sanctions output levels.

Asked if Tehran was ready to coordinate a production cut to support the oil market, Masoud Hashemian Esfahani, the acting deputy oil minister, told Reuters news agency: “We do not like to cut. We need to [get] back our share.

“The [oil] price completely depends on [the] market situation and we have a surplus of supply now. Maybe some countries must cut their share and many countries [must] get back their share,” Esfahani said in Moscow.

OPEC increased its total oil production by 131,000 barrels per day (bpd) in January even though oversupply has been a major reason for falling oil prices, according to data issued by the cartel.

The Vienna-based group of mostly Arab, African and Latin American countries said on Wednesday they pumped 32.3 million bpd last month.

Saudi Arabia and other Arab members of OPEC have so far stopped the group from propping up prices by lowering output, in an apparent effort to use the current slump to win market shares from the US, where oil production is costlier than in the Gulf.

Meanwhile, oil prices rebounded on bargain-buying in Asia on Wednesday after the previous day’s plunge, but analysts warned that any gains would be limited as the global glut that has hammered markets showed no sign of letting up.

Crude prices have crashed from above $100 a barrel in July 2014 to under $30 after being hit by a perfect storm of overproduction, oversupply, weak demand, and a slowdown in the global economy, particularly the key consumer China.

A report by the Kuwait Financial Centre released on Tuesday said that the oil-rich states of the Gulf Cooperation Council are expected to see their public debts double and their assets decline by one-third by 2020 as they seek to finance budget deficits.

The report noted that GCC countries face a combined $159bn deficit in 2016. In contrast, the GCC posted a combined surplus of $220bn in 2012.

Source:Al Jazeera:Iran set to negotiate on oil market with Saudi Arabia

February 10, 2016