Rwanda emerges as a vibrant economy

Two things had happened quite close to each other. The International Monetary Fund (IMF) had agreed to release $181.7 million after a review of the country’s economy. The IMF has projected that Rwanda will grow 8.3 per cent in 2024 and 7 per cent in 2025, after its 8.2 per cent growth in 2023.

The IMF said, “Rwanda’s economy has shown resilience, supported by robust growth in key sectors and a recovery in agricultural production. Inflation has remained stable within the central bank’s target range, reflecting effective monetary policy actions.” This positive assessment came with the caveat: “However, the economy continues to face external vulnerabilities, including a widening current account deficit and exchange rate pressures.”

The other thing, which chimes with the good news on the economic front, is Rwanda’s intention to bid for the F1 Grand Prix. President Paul Kagame had said, “I am happy to formally announce that Rwanda is bidding to bring the thrill of racing back to Africa by hosting the F1 Grand Prix.” The president said that “good progress” was made in the discussions with the F1 management team led by Stefano Domenocali, the CEO. The last time the Grand Prix was hosted in the continent was in South Africa in 1993.

The connection between the two developments is obvious. The economy is doing well, and hosting international sporting events will boost the economy by bringing in tourists. Rwanda is also set to host the 2025 Cycling World Road Championships. According to the Rwanda Development Board (RDB), tourism revenue stood at $636 million in 2023, a 36 per cent increase from 2022. Rwanda’s GDP was $13.31 billion in 2022.

Rwanda has come a long way from its traumatic moment in 1994 when the internecine strife between the Hutus and Tutsis ended in the death of one million people, and an estimated 150,000 to 250,00 women raped. Today, Rwanda is an exemplary economy, which has become the hub of digital technologies to other countries in Africa. Rwandan entrepreneurs are credited with creating digital technologies and solutions and which are being exported to other African countries. It is the kind of digital revolution that Africa needed, and Rwanda has become a pioneer in the field. The National Strategy for Transformation (NST2) aims to double digital exports to $7.3 billion by 2029. The spurt in digital startups and increase in exports has increased the confidence of the Rwandan entrepreneurs. Erembo, a Rwandan digital platform to improve local governance, has elicited interest in other African countries. That is why Esther Kunda, Director General for Innovation and Emerging Technologies in the Ministry of ICT, said that government is encouraging home-grown tech solutions, which hold the potential for exports.

Alex NItale, CEO of Rwandan ICT Chamber, emphasised the country’s competitive edge. He said, “Opening a business in Rwanda is easy, and the country is also open to shared education and learning.” He pointed to Carnegie Mellon University and the African Institute of Mathematical Sciences (AIMS) which would attract tech-savvy Africans to Rwanda. Rwanda seems to be an example of the Africa turnaround despite the political instability in many of the countries on the continent. The African leaders have recognised that they have to pull their people out of poverty through their own efforts and that they cannot depend wholly on developed economies to do it for them.

The example of Rwanda forging ahead on many economic fronts is the sign of the times. It is a case of Africans helping Africans. There has been much talk of Asian solidarity and the Asian Century. There seems to be a clear prospect of African Century round the corner.