Business
Rwanda’s Central Bank Governor Says its Economy has Reached a Turning Point
Loans to the private sector have picked up as Rwanda emerges from the effects of delayed aid disbursement, but the country is still too dependent on imports. Entering 2014, Rwanda’s Central Bank Governor, John Rwangombwa, is focused on encouraging banks to extend credit to the private sector, expanding financial inclusion and stabilising the economy after donors cut off aid to the government in 2012.
The International Monetary Fund predicts that the economy will grow by 7.5% in 2014 but warns that the financial system is too weak to offer the government the possibility of getting more financing from the domestic market. In response, the government is preparing for the launch of an international sovereign bond within the next year or two.
Rwangombwa is working on improving Rwanda’s macroeconomic performance. President Paul Kagame appointed him as governor of the National Bank of Rwanda on 25 February 2013. Prior to his appointment, he served as finance and economic planning minister. Rwangombwa had served as the permanent secretary and secretary to the treasury from September 2005.
As permanent secretary, he oversaw the drafting and implementation of Rwanda’s first Economic Development and Poverty Reduction Strategy, under which Rwanda was able to reduce poverty by 12% between 2006 and 2011. He chaired development partners’ forums for the government.
Rwangombwa also oversaw the drafting and implementation of a five-year public finance management reform programme that led Rwanda to produce its first government financial statements in 2007.
The Africa Report : What are the greatest economic risks that you see ahead in the short and medium term?
John Rwangombwa : [There are] two main risks. The biggest one is agriculture because we are still relying on weather. If the weather is not good, it will affect the performance of the economy in 2014. We are still weak in terms of financing international trade. For instance, the experience of last year about the delayed donor support shows how if anything of that nature happens this will affect our growth as well.
