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Working Paper 177 - A Macroeconometric Model for Rwanda
Rwanda enjoys a decade long of macroeconomic stability, with high, on-target rates of growth in economic activity (relative to long run goals), low (single-digit) ináation and international reserves deemed to be at ìcomfortableî levels (IMF, 2011). The economy grew by an average of 7.4% per annum during the year 2000-2011, with a real per capita income growth of 4.7% per annum. The successful implementation of the Örst Poverty Reduction Strategy (PRSP 1: 2002-2005) and its successor- the Economic Development and Poverty Reduction Strategy (EDPRS: 2008-2012) ñhave contributed for the notable economic and social outcomes. The country is preparing to launch the second phase of the EDPRS (EDPRS 2) for 2013/14-2017/18. However, there is no elaborated framework in government bodies for macroeconomic policy analysis and evaluation. The lack of such framework would make policy analysis di¢ cult when the e§ects of proposed policies are not tractable by simple reasoning alone. This paper proposes a macroeconometric model of Rwanda to Öll this gap.