Rwanda is set to secure $184.9 million (approximately Frw 250 billion) from the International Monetary Fund (IMF) as part of new funding aimed at supporting the country’s economic recovery and resilience programs. The funding package includes $95.9 million from the Resilience Sustainability Facility (RSF) and $89 million from the Standby Credit Facility (SCF).
The disbursement of these funds will be contingent on the successful completion of an economic review by the IMF Executive Board, scheduled for mid-December.
An IMF delegation, led by Reuben Atoyan, concluded a two-week mission to Rwanda on October 22, 2024, assessing the nation’s economic performance. The team praised Rwanda’s strong growth momentum in spite of ongoing external challenges. The IMF projects that Rwanda’s real GDP will expand by 8.3% in 2024, supported by robust performance in the services and construction sectors, as well as a recovery in food crop production.
Inflation, according to the IMF, remains within the National Bank’s target range of 2% to 8%, driven by favorable food prices and tight monetary policy measures. The mission highlighted that the 6.6% depreciation of the Rwandan Franc against the US dollar was essential for critical external adjustments. As of mid-2024, international reserves covered 4.5 months of projected imports, providing a cushion against external shocks.
Despite challenges, the IMF confirmed that Rwanda’s macroeconomic policy up to June 2024 remained aligned with the objectives of the PCI/SCF program, with all quantitative targets being met. Ongoing reforms aimed at increasing transparency in public investments and strengthening the foreign exchange market were noted as progressing effectively.
The IMF team commended the Rwandan government’s dedication to implementing climate-related reforms under the RSF, emphasizing progress in areas such as climate budget tagging, resilience of public investments, sustainability disclosure standards, and developing a green taxonomy.
However, the report acknowledged that repeated external shocks have posed challenges to the government’s efforts in rebuilding policy buffers. This has led to a slower-than-anticipated pace of fiscal consolidation, causing a rise in the public debt-to-GDP ratio. Nonetheless, the government reaffirmed its commitment to fiscal prudence, focusing on concessional financing and advancing a medium-term revenue strategy to stabilize its fiscal position.
