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The World Bank projects Rwanda’s economy to grow 7,2 percent between 2024 and 2026, driven by global tourism, new construction projects, and increased manufacturing activities.
A report by the bank shows that “fiscal consolidation will continue, focusing on reducing subsidies, overseeing state-owned enterprises, and introducing tax policy measures to broaden the revenue base.”
The report indicates that Rwanda’s economy grew at 7,6 percent in the first three-quarters of 2023 despite a challenging global environment and recent floods. According to the bank, services sector, sustained domestic demand, and the rebound of the industrial sector, contributed to the growth.
“Rwanda successfully balanced inflation control, managed external deficits, and ensured fiscal prudence.
It showcased a resilient financial sector, despite widening external deficits and the depreciation of the Rwandan franc,” the report says.
“The World Bank encourages the country to pursue its prudent fiscal management by reducing non-essential spending and prioritising investment in human capital,” said Peace Aimee Niyibizi, World Bank country economist for Rwanda.
This outlook is, however, subject to significant risks, including disruptions to the global economy, trade, and lower availability of concessional resources.
Experts have also noted that frequent weather-related shocks could result in a decrease in food production, and higher food prices, negatively impacting poor households.
The Rwanda Meteorological Agency has warned that the country will have unusually heavy rains between March and May.
Western and southern Rwanda, as well as Kigali City are expected to experience rains ranging between 700 millimetres and 800 millimetres, a range last experienced in 2016. – The East African
Online Reporter