Finance and Economic Planning Minister, John Rwangombwa, Shares Rwanda’s Success Story
The African Development Bank (AfDB), United Nations Development Programme (UNDP) and the Economic Commission for Africa (ECA) jointly launched the African Economic Conference (AEC) in Kigali, Rwanda, on Tuesday, October 30 to discuss “Inclusive and Sustainable Development in an Age of Economic Uncertainty”. On the eve of the meeting, John Rwangombwa, Rwandan Minister of Finance and Economic Planning, spoke about the importance of the conference, now in its seventh year, which is being held for the first time in Rwanda.
Question: What message would you convey to delegates, comprising policy-makers, civil society organizations, researchers and academics attending this conference?
Answer: The African Economic Conference could not have come at a better time. The continued uncertainties in the global economy, linked frequent turmoil in the capital markets and debt problem in the developed world poses big challenges to Africa’s economic development. This can be seen as an opportunity as well. I am glad delegates will dig deep into these issues here in Kigali. I would like to thank the African Development Bank and its partners for organizing this meeting. This conference is a good precursor. Africa needs economic transformation over the coming decade if it is to develop at all. We cannot continue being the continent of primary commodities.
Question: This morning, as you officiate the opening of the African Development Bank’s networking session on flow of funds and Africa’s economic transformation, you made a very strong point concerning foreign direct investment (FDI).
Answer: Yes. As I said earlier, the continued uncertainties in the global economy, linked with frequent turmoil in the capital markets and the debt problem in the developed world pose big challenges to Africa’s economic development. This can be seen as an opportunity as well. Policy-makers working closely with researchers and think tanks of the continent can turn these challenges into opportunities. We must present ourselves as the most profitable and secure destination of investors’ funds that are scared of the problems in the Western markets. It is worrying to know that Africa attracts less than nine per cent of FDI. We need as much as possible to continue reducing the uncertainties about the evolution of our economies.
Question: Is there any hope for Africa?
Answer: Absolutely, yes! The fact that Africa’s economy has been growing at an average of five per cent despite the global economic crisis is an indication that we are on the right track. However, we can do even better. Rwanda has been growing at an average of 8.3 per cent over the past 10 years. I am convinced that if Rwanda, a small, land-locked country with few resources, can achieve this growth, Africa as a whole can achieve double-digit growth if we do few things the right way. We are currently elaborating our second economic development plan and are targeting 11.5 per cent growth.
Research is one of the ways this understanding can be enhanced – and Africa, in its search for economic transformation, will increasingly need to develop understanding of our economic opportunities and challenges. Thanks to the African Development Bank, today we are discussing the flow of funds. I believe it is one of the avenues of improving our understanding. It is important to devise policies that will ensure optimal allocation and use of those funds in an economy. It is important that we also better understand the responses and reactions of funds to various shocks.
This is the basis of good policy design. We would need to ascertain what should be the role of governments, private sectors, as well as what should be the priority sectors that would expedite economic development in Africa.