Category: Economy

It takes no more than five minutes by car or motorcycle from Musanze City to reach the state-of-the-art craft center built for artisans who previously operated near the city’s bus station.

This craft center, which accommodates over 700 people, mainly carpenters, is one of the projects funded by the Belgian Development Agency, Enabel. The center is modernly constructed, with separate sections for carpenters, metalworkers, and display and sales areas.

The Director of the Musanze Craft Center, Ndayambaje Deogratias, told IGIHE that their operations changed from January 15, 2022, when they moved to a spacious, beautiful location where they can also benefit from collective learning.

He said, “Comparing where we used to work and where we are today, there is a vast difference in size and appearance. Engaging in craftsmanship involves continuous learning, observing the innovations of others, and trying to create new things in your work. This is different from our previous situation where we were very few, as craftsmen were scattered all over Musanze City.”

Nyirasafari Sawiya, who sells timber at the craft center, entered the business after realizing that selling clothes had become overly common. She decided to venture into the craft center.

She told IGIHE that she sells no fewer than two thousand pieces of timber per month, each priced between 2500 and 3500 Frw.

She said, “Many things we need come from timber, and there is never a time when it’s not needed. This is the central point for all timber, making it quicker to access than in the city, which was congested. Today, this place is spacious and accommodates many people from nearly all the sectors of the district.”

The craft center also serves as a training ground for the youth, enabling them to develop skills for self-improvement through various crafts and trades.

On the other hand, another group of young people gathers in the Muhoza Sector at the Youth Center, also built with Enabel’s support, where they gain knowledge and skills in technology, entrepreneurship, and job hunting.

Mwamarakiza Martin, who now provides technology services in Musanze City, told IGIHE that the knowledge he gained from the youth center in the district enabled him to become an entrepreneur and employ his peers.

He said, “I had just left school in Butare and felt like a student who hadn’t reached the level of doing things to sell. But here, they were a good example of how I could start my own project, how to procure things and sell them, especially as technology involves mostly using your brain and buying a few tools to achieve what you want.”

The Mayor of Musanze District, Nsengimana Claudien, told IGIHE that the projects developed in partnership with Enabel are helping residents, particularly the youth, to conduct research and advance themselves.

He said, “They helped us build the youth center where they gather and the equipment within that building, enabling them to conduct research and enhance their knowledge because it is a center equipped with modern technology and tools. It helps the youth in conducting research, such as farmers finding modern farming methods, students enhancing their education quality, and various groups benefiting from the center.”

Mayor Nsengimana stated that the Musanze Craft Center plays a role in boosting the economy of the residents as it accommodates over 700 workers.

“Their families are sustained because of the income generated from the work they do there, and it continues to help various people create jobs.”

The Youth Center cost 1.7 billion Frw to build, while the craft center cost 1.5 billion Frw.

Currently, the Musanze Youth Center receives around 600 visitors seeking job opportunities and entrepreneurship training, 700 monthly visitors seeking reproductive health services, 500 monthly visitors using computers, and approximately 9,000 participants in sports and recreational activities.

President Kagame said that some powerful entities have not been responsive to calls for reforming the existing financial systems due to fears of losing influence and control over the sector.

The Head of State spoke on Wednesday, May 29, during the presidential dialogue on the topic “Africa’s Transformation, the African Development Bank (AfDB), and the Reform of the Global Financial Architecture” at the AfDB annual meetings in Nairobi, Kenya.

He emphasized that it was a “no-brainer” that financial systems designed more than 50 years ago are no longer viable today.

“Things have changed, and therefore, a rethink of a new design that fits the purpose must be put into play. There is no doubt about that. I think everybody understands that point, but there are interests that operate behind it. For us in Africa, we are hard-pressed to see there is a change in the design of these institutions. But maybe the way the institutions are set up benefits some parts of the world. Those in those parts of the world are not interested, or they are being slow in allowing the change to happen because it gives them control and say over other people’s resources,” President Kagame stated.

“Everybody understands [that reforms are necessary]. What is complicated is reaching this understanding and compromising that we don’t lose anything by having everybody benefit as we should benefit, all of us.”

President Kagame also noted that for Africa to achieve the much-needed gains, the continent must be united and speak in one voice.

“Africa’s interests must be taken care of, beginning with ourselves…it has to be with one voice but also loud, clear, and effective. For that to happen, we think about working together,” he said.

“The reform we are talking about is how to disrupt the current architecture so that it includes significantly and visibly the interests of our continent.”

He said the rest of the world can not afford to ignore the African continent as it’s the only region that will have a growing middle-income class in a “few decades”.

“In a few decades, the only place in this world that will have a growing middle class is Africa. So it is even in the interest of the rest of the world that has marginalized Africa to contribute to the wellbeing of our continent. Because the growth of Africa, based on this middle-class, feeds into the growth of the rest of the world,” President Kagame said, adding “But Africa cannot wait to be handed this opportunity by anybody else, we therefore must be on the frontline, fighting for this right, for ourselves but also which contributes to the wellbeing of the rest of the world.”

The presidential dialogue was part of the five-day 59th Annual Meeting of the Board of Governors of the African Development Bank and the 50th Meeting of the Board of Governors of the African Development Fund taking place at the Kenyatta International Conference Center (KICC).

Kenya’s President William Ruto, who was among the panellists, also emphasized that the reforms were long overdue and should solve the continent’s most pressing issues including climate change.

“The issue of reforms is settled; it must be done. We need a financial architecture that has long-term financing, with 40 years or 10 years grace period, low-interest rates, concessional financing, including where possible grants. We also need financing at scale; the quantum is very important. We also need finance that is agile, flexible, and especially climate-sensitive. So, if there are shocks, that financial architecture must be responsive because climate change is the new normal,” President Ruto explained.

“Switching from drought to floods progressively is becoming what it is. In Kenya, we had a drought a year ago that decimated 2.5 million herds of livestock. This year alone, we are on floods that have taken the lives of 200 Kenyans. So, this is the new reality. The financial architecture that must be in place must respond to this climate reality we have.”

The Annual Meetings comprise Member States’ invitation-only sessions, closed bilateral meetings, as well as events open to all attendees, including the press. They provide a forum for Bank Group Governors to share their experiences with managing a mounting burden of public debt, which has surged following the global economic shocks of the last few years.

The meetings also offer a forum for the delegates to examine the African Development Bank’s contribution to Africa’s socio-economic transformation.

Speaking during the Zimbabwe-Rwanda mid-term review meeting of the 2nd Joint Permanent Commission on Cooperation, which kicked off in Harare on Monday, Rwanda’s Ambassador to Zimbabwe, James Musoni, said the two countries had achieved commendable progress on various Memoranda of Understanding (MoUs) signed in recent years.

“Today, as we review our achievements and challenges, I am pleased to report that our joint endeavours have yielded remarkable results in various key sectors for example in the political and diplomatic sector, our relations have grown to a remarkable level, where both countries support each other in regional, continental and international matters of common interest,” Ambassador Musoni affirmed.

The ambassador also lauded partnerships in the education sector where more than 150 teachers and lecturers from Zimbabwe have been in Rwanda reinforcing the local teaching working force for about two years.

“We have also recorded remarkable achievements in our Defence and Security sector, there have been exchanges and training of senior and Junior officers in the army, and correctional service,” Musoni added.

In the energy sector, the ambassador said, Rwanda Energy Group (REG) and Zimbabwe Electricity Supply Authority (ZESA) had completed the pilot street lighting project in Harare and also finalized the access masterplan advisory services as outlined in the MoU signed in 2020.

Additionally, in the trade and Investment sector, both countries have been hosting the business forum on a rotation basis.

“The recent [business forum] took place in Rwanda in March 2024 and a number of businesses are being established in both countries as a result of the excellent cooperation between our sisterly nations,” he added, further emphasizing the need to use the JPCC as a stepping stone to further collaborate at the regional and global levels.

Albert Ranganai Chimbindi, the Zimbabwean Secretary for Foreign Affairs and International Trade, said the meeting was aimed at assessing the progress of work on the decisions made during the 2nd Session of our JPCC, which was held in May 2023.

Chimbindi praised the remarkable strengthening of ties between Zimbabwe and Rwanda over the past four years.

“Allow me to acknowledge the excellent bilateral relations that subsist between the Republic of Zimbabwe and the Republic of Rwanda. I am pleased to say that since we embarked on the journey of our Joint Permanent Commission on Cooperation in 2020; our relationship continues to grow from strength to strength. In addition, the continued engagements by our two Presidents at various fora and the continued exchange of high-level visits, testify to our blossoming relationship,” Chimbindi stated.

He added, “I do acknowledge, with satisfaction, the positive discourse that is taking place in the Political and Diplomatic, Defence and Security Cluster. I am particularly impressed by the continued collaboration in our Political and Diplomatic Consultations, where parties continue to support each other on bilateral, continental and international issues of mutual concern and interest.”

In a statement, the IMF said the disbursement of the funds follows the conclusion of the third review under the Policy Coordination Instrument (PCI), the arrangement under RSF, and the first review under the SCF arrangement with Rwanda. The Executive Board’s decisions were taken without a meeting.

“Despite challenging external conditions and ongoing fiscal consolidation, Rwanda’s economy maintains robust growth. Going forward, the policy mix should prioritize macroeconomic and financial stability, fiscal sustainability, and the restoration of buffers,” IMF said.

Notably, RSF provides affordable long-term financing to countries undertaking reforms to reduce risks to prospective balance of payments stability, including those related to climate change and pandemic preparedness, while PCI is a non-financing instrument open to all IMF member countries.

On the other hand, SCF provides financial assistance to low-income countries (LICs) with short-term balance of payments needs.

The funds will, among others, help the government in its efforts to mitigate the impact of last year’s deadly flooding.

According to the IMF, sustaining the strong reform momentum under the RSF will enhance Rwanda’s economic resilience to future climate shocks.

“Going forward, the policy mix should prioritize macroeconomic and financial stability, fiscal sustainability, and the restoration of buffers. A carefully planned fiscal stance is needed to mitigate the impact of the 2023 floods while maintaining a credible and balanced fiscal consolidation over the medium term,” IMF added.

“Monetary policy should target inflation within the desired range, while maintaining exchange rate flexibility to manage external shocks. Furthermore, vigilant oversight of financial stability risks, particularly concerning large exposures and rapid credit growth, is important.”

The disbursement comes two months after IMF staff and Rwandan authorities reached a staff-level agreement on policies needed to complete the financing reviews.

The agreement followed the conclusion of a two-week mission led by Ruben Atoyan, who visited Kigali from 11–22 March 2024, to discuss the authorities’ policy priorities and progress on reforms regarding the reviews.

At the conclusion of the mission, Atoyan praised Rwanda’s economic gains and resilience, notwithstanding the challenging external environment.

“The 2023 GDP growth continued to be robust at 8.2 per cent year-on-year, on the back of strong performance in services and construction, as well as recovery in food crop production in the second half of the year. Inflation decelerated sharply in recent months. Headline inflation was 4.9 per cent in February 2024, down from the peak of 21.7 per cent in November 2022, owing to appropriately tight monetary policy stance and favourable developments in food prices as agricultural production rebounded at the end of last year,” Atoyan stated.

In the survey results announced on Monday, May 20, 2024, NISR said the significant decline brought back the unemployment rate to the pre-COVID-19 estimate of 13.1 per cent.

The latest trend shows that in the first quarter of 2024, one person was unemployed for every eight people in the labour force.

The report further indicates that gender disparities persist in unemployment, with females experiencing a higher rate at 14.5 per cent compared to males at 11.5 per cent.

Furthermore, youth face a notably higher unemployment rate of 16.6 per cent compared to adults at 10.3 per cent.

NISR also highlighted that urban areas continue to bear a heavier burden with an unemployment rate of 14 per cent compared to rural areas where the unemployment rate stands at 12.3 per cent.

“Despite these challenges, there is progress in narrowing the gender gap in unemployment, which was recorded at 3 percentage points in 2024(Q1), showing improvement from 3.7 percentage points in the same quarter last year,” NISR said.

“This data underscores the need for targeted interventions to address unemployment disparities across demographics and regions, ensuring inclusive economic growth and opportunities for all Rwandans.”

The latest survey also sheds light on the composition of Rwanda’s workforce. Out of an estimated working-age population of 8.2 million (16 years and above), approximately 4.37 million are employed. Another, 648,000 individuals are currently unemployed, while 3.2 million are categorized as out of the labour force. This means Rwanda’s labour force, encompassing both employed and unemployed individuals, stands at around 5 million.

The labour force participation rate, representing the proportion of the working-age population actively engaged in the labour force, has continued to record a steady increase since 2021 Q1. By 2024 Q1, this rate reached 61.0 per cent, marking a 2.4 percentage point rise from the previous year’s estimate of 57.6 per cent.

Additionally, the gender disparity in labour force participation persists, with males consistently exhibiting higher participation rates than females. In February 2024(Q1), this gender gap stood at approximately 14.6 per cent, mirroring the situation observed in the same quarter of the previous year.

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The Employment-to-Population Ratio (EPR) increased significantly from 47.7 per cent in the first quarter (Q1) of 2023 to 53.1 per cent in the first quarter of 2024.

Although the overall picture is positive, there are still disparities in who gets jobs. Men have a significantly higher EPR (60.9 per cent) compared to women (46.3 per cent) in 2024 Q1.

Similarly, younger people (16-30 years old) have a lower EPR (47.7 per cent) compared to adults (57.4 per cent), pointing at challenges for youth entering the workforce.

Makhtar Diop, the Managing Director of the International Finance Corporation (IFC), argued that companies in Silicon Valley and other Western countries mainly fund most African start-ups.

The IFC boss noted that some of the disruptive start-ups had benefited from the organization’s direct funding, but more was needed to support the companies.

“We need to support our start-ups. It’s imperative that more funding, especially from the domestic private sector, is directed towards this vibrant sector. At IFC, we are trying to do that with our direct technology fund, and we are trying to invest in start-ups in technology that will make a difference for development. But we need more billionaires and millionaires in Africa to believe in these start-ups. These start-ups are still largely funded from Silicon Valley and other parts of the world,” Diop stated.

IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector in developing countries.

Diop praised ongoing, revolutionary projects undertaken by organizations like Genomics Africa, which have helped Africa claim its position in research sectors previously dominated by other regions, saying “This is the African Continental Free Trade Area (AfCFTA) in action.”

He noted that genomics research leverages the rich biodiversity and genetic resources of the continent, laying the groundwork for precision medicine and the development of treatments tailored to the specific needs of the African population and diaspora.

To keep up Africa’s growth momentum, Diop emphasized the need to exploit digitization, stating that data is the new gold.

He also called for more investments in the education system, saying “It’s time to create emphasis on science, technology, engineering and mathematics.”

“It’s heart-warming to see Rwanda hosting regional institute of mathematics and IT and forging partnerships with renowned academic institutions. This is an example that needs to be multiplied and repeated across the continent.”

He called for increased partnerships and dialogue between the private and public sectors to achieve sustained economic development across all sectors, including energy and agriculture.

“Many of our utilities are in poor condition, which limits the ability of the private sector to invest in renewable energy generation. We lack a private sector presence in transmission and distribution. All these factors are hindering investment in this sector, which is crucial for Africa’s development,” he stated.

Kigali welcomes the Africa CEO Forum for the second time since 2019 when the forum made its debut in the East Africa region. More than 2,000 business leaders and government officials are gracing the CEO forum.

President Paul Kagame his Mozambique counterpart Filipe Nyusi and two prime ministers, Patrice Emery Trovoada of Sao Tome and Robert Beugre Mambe of Côte d’Ivoire attended the opening ceremony on Thursday morning. Presidents William Ruto of Kenya, Mokgweetsi Masisi of Botswana, and Ismail Omar Guelleh of Djibouti are also expected at the two-day event.

Rwanda Development Board (RDB) is hosting the event alongside IFC.

The forum themed “At the table or on the menu?” is expected to challenge attendees to take decisive action for Africa’s future amidst global economic uncertainties.