Rwanda’s economy is expected to grow at a higher rate than projected, after performing well in the first three quarters of 2022 as a result of economic recovery measures, the Minister of Finance, Uzziel Ndagijimana, said.

While presenting the 2022/2023 mid-term budget revision to Parliament on Wednesday, February 08, Ndagijimana said that the country’s economic growth is currently projected at an average of 8.5 per cent in the first three quarters of 2022-2023, with signs of beating the projected 6.8 per cent growth for the entire year.

Government proposed that the national budget increase by Rwf106.4 billion to Rwf4,764.8 billion, which is a 2.3 per cent rise from Rwf4,658.4 billion original budget that was approved by Parliament in June, 2022.

READ ALSO: REVISED BUDGET: Govt spending increases by Rwf106bn

The Minister said that despite persistent challenges stemming from Covid-19 effects, global supply chain issues, inflationary environment and impact of climate shocks, our economy continues to show strong signs of recovery.

"Our growth in the first three quarters of 2022 exceeded our initial projections. So, we also expect the annual growth to be higher than what we projected. We had projected 6.8 per cent, but the average of the first three quarters is 8.5 per cent, which means that we will achieve higher than what we expected,” he said.

Ndagimana told parliamentarians that the health and economic measures that Rwanda deployed to tackle the Covid-19, contributed to the recovery of its economy from the pandemic impact since 2021, and kept the momentum in 2022.

Specifically, he indicated the good performance was achieved in the service sector – which was brought to its knees by the Covid-19 padndemic – as it grew by an average of over 13 per cent in three quarters of 2022.

READ ALSO: Service sector fuels economic growth in second quarter of 2022

In October 2022, the International Monetary Fund (IMF) and the Government of Rwanda agreed that the country’s economy had been staging a robust growth despite the unfavorable global environment.

Then, IMF staff estimated that Rwanda’s gross domestic product (GDP) was expected to expand by 6.8 percent in 2022 from the earlier projected 6 per cent, due to strong performances in the first two quarters by that time.

"This revised budget will support continued economic recovery, supplement job creation efforts and continue to facilitate businesses to recover from covid-19 impact. Additional Investments in education, healthcare, ICT, and agriculture will be at the forefront of the ongoing government effort to invest in Rwanda’s future, through the National Strategy for Transformation (NST1).”

Meanwhile, projections from the Ministry of Finance and Economic Planning, suggested that Rwanda’s economic growth was expected at 6.7 per cent in 2023 and 7 per cent in 2024 and 2025.

Global economic outlook

Minister Ndagijimana said that IMF’s forecast as of January 2023, estimated the global economy is expected to grow by 2.9 per cent in 2023, which is lower than 3.4 per cent in 2022, mainly because of the high increase in commodity prices compared to previous years, financial sector disruption, and the Russia-Ukraine war impact.

For Sub Saharan Africa, he said, its economy is projected to grow by 3.8 per cent in 2023, the same rate at which it rose in 2022.