Monday, 7 July 2014

Rwanda tops World Bank economic handling report

Rwanda’s economic management and structural policies is the most-improved in sub-Saharan Africa, the World Bank’s Country Policy and Institutional Assessment (CPIA) report shows

Overall, the country improved from aggregate 3.8 in 2012 to 3.9 last year.

The report, launched in Kigali, shows that Rwanda has the highest CPIA score in Africa, putting it alongside Cap Verde and Kenya at the top of the score range of aggregate 3.9, while South Sudan and Eritrea, both struggling with deep policy challenges, had the lowest scores.

Rwanda was followed by Burkina Faso and Senegal, who scored aggregate 3.8 each, while Tanzania, Uganda and Ghana tied in third with aggregate 3.7.

Over all, Rwanda scored aggregate 3.5 on property rights and governance, 4.0 on quality budgetary and financial management, and 3.6 on public sector and institutional management.

On efficiency in revenue collection, quality of public administration and transparency and accountability, the country scored aggregate 3.5. The performance was attributed to a prudent monetary policy, conducive business reforms, excellent debt policy management and measures geared toward transparency, accountability and good governance.

The good rating could see Rwanda’s resource envelope from the World Bank’s International Development Association (IDA) increased, Punam Chuhan Pole, the lead economist at World Bank Africa and author of the report, said.

“We are seeing a tremendous improvement in the way Rwanda has been handling its budgetary and financial management, public administration, efficiency in revenue collection and the overall business reforms geared toward encouraging private sector investments,” Punam Chuhan said during the launch of the report.

The economist said fragile countries, especially post-conflict countries, accounted for over half of the improvement in overall CPIA scores in the region, illustrating the importance of peace and stability in economic growth.

Waleed Malik, the senior public sector management specialist at the Bank, said although Rwanda has put up an impressive performance, there is need to shift away from policy formulation to actual implementation, especially on judicial systems, revenue mobilization and property rights.

Francisco Ferreira, World Bank Africa chief economist, said African countries eligible for IDA lag behind those in other regions in their policy and institutional ratings.

The Permanent Secretary in the Ministry of Finance and Economic Planning, Kampeta Sayinzoga, said despite the impressive performance, government was ready to work with all stakeholders to improve the areas where performance was low.

The World Bank has renewed its support toward the government’s economic objectives as enshrined in the second Economic Development and Poverty Eradication Strategy, with $700 million per year in funding over the next four years, up from about $500 million in 2013.


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