Frw224.4 billion (nearly $300 million) will go towards easing Rwanda’s business environment. These will include key investments in improving transport, energy and water services.
The Minister of Finance and Economic Planning Amb. Claver Gatete presented to both Chambers of Parliament, the Budget Framework Paper (BFP) and the midterm budget estimates for 2016/17 -2018/19.
BFP is a document outlining government economic policies over the medium term that help lay the foundations of the next fiscal budget.
“In the prevailing global and regional contexts, we project Rwanda’s GDP growth to average 6% over 2016/17 before recovering strongly in 2018 and beyond while inflation remains subdued below 5%,” Amb. Gatete said.
Amb. Gatete told the August House that the BFP had been prepared against the background of a significant slowdown of the global economy which had spillover effects on the external balance of Rwanda and the economy in general.
To address the impact of economic shocks on the domestic economy, the Minister said the government will aggressively promote export promotion and import substitution measures such as ‘Made in Rwanda’.
To this end, he proposed allocation of Frw 45 billion (about $60 million or 6% of development budget) to be spent on developing textiles, garments and leather industry, add value to minerals coffee and increase tea production.
The money will also operationalize horticulture, livestock products and services exports as well as expand the export growth fund. Amb. Gatete also proposed allocation Frw 61.4 billion (8% of development budget) to be spent on increasing agriculture productivity and strengthening market linkages. This, he said, would be spent on crop intensification programs.