Govt calls on donors to end tied-aid policy

Rwanda has reiterated calls to donors to stop giving development aid with unnecessary strings attached. Speaking to lawmakers at Parliament, yesterday, Finance and Economic Planning minister Claver Gatete said the government’s primary vision is to see the country shape own development agenda in national context and realities. Minister Gatete was briefing lawmakers on the post-2015 development agenda ahead of next week’s third Financing for Development Conference in Addis Ababa, Ethiopia. ‘Financing for development’ issues will be highlighted by Gatete at the international conference expected to attract heads of state and government, ministers for finance, foreign affairs and development cooperation, as well as relevant stakeholders. The July 13-16 conference comes six months before the expiry of the UN Millennium Development Goals (MDGs).Countries will be exploring how Sustainable Development Goals (SDGs), a new set of 17 action-oriented, concise and easy to communicate goals in the UN development agenda beyond 2015, will be achieved. “We want to discuss how to finance the SDGs but we want to change the way things are done because donors can promise us the money but you cannot use it because of the conditions and the strings attached,” Gatete said. “Many a time, they tell you that you have to use resources but don’t allow you to go and borrow even when you have the capacity to pay back. We’ll tackle all these things.” Climate financing will also be on Rwanda’s list seeing that after considering the principles of common responsibility and differentiated responsibility, or the “polluter pays” principle, Rwanda is supporting the latter where the polluter should pay. “There is no need to put countries in one basket so that we lose out,” he said. In addition, considering climate financing as part of official development assistance (ODA) targets, the minister noted, Rwanda’s position is also to have climate financing separate. Minister, MPs talk tough The issue of pegging aid to sexual rights in a country is unreasonable, Minister Gatete noted. “Sexual rights are not universal if you consider the differences in cultures the world over. Even when it comes to human rights, there can be no greater human right, for a Rwandan, than getting out of poverty,” he said. The lawmakers remained firm in their stance on the Western tendency of promoting gay practices. MP Emmanuel Mudidi said: “I really want to emphasise that the minister must be firm on issues such as sexual rights. We have our own culture and rights that are different from theirs.” MP John Ruku-Rwabyoma was more emphatic directly addressing UN Resident Coordinator Lamin Manneh, who was present, on the issue of sexual orientation. “In Rwanda, what goes on in people’s bedrooms is none of anyone’s business,” he said. Meanwhile, domestic revenue mobilisation will also be top among items for discussions at the meeting. Amb. Gatete said Rwanda needs to increase domestic revenue mobilisation from the current 15 per cent of GDP to a “much ambitious level to be able to finance our development.” To free itself from external support and the attached strings, Rwanda is striving to meet and surpass the average of around 18 per cent of GDP in sub-Saharan Africa (SSA). Furthermore, the minister said international tax cooperation would ensure that foreign investors do not take advantage of legal loopholes in tax legislations to undermine domestic revenue mobilisation efforts. “Foreign investors are looking for many incentives which we cannot give, yet in their countries we don’t even know what they get,” the minister said, explaining why efforts must be put in avoiding double taxation. Cooperation with international taxation mechanisms will help remedy this loophole, he suggested. Rwanda will also be pushing for possible new rules of engagement between donors and countries with the private sector. It is not only about the money that development partners bring in but they should also be able to help bring in investors, Gatete said. “The engagement beyond what is being done today is possible. And then, the private capital markets access is much needed as public finance alone, be it domestic or international, will not be sufficient to propel us to a middle-income country status and ensure the wellbeing of our citizens. We cannot continue to do business as usual,” Gatete said. The minister stressed the need to see the country get better access to more concessional and market-related financing. This, he said, implies mainly having more access from the multilateral banks as a bridge to sustain economic and social gains and allow the economy to expand and be more resilient to external shocks. The government will also seek review of the joint World Bank–International Monetary Fund Debt Sustainability Framework (DSF), which, the minister said, limits the country’s borrowing capacity . Meanwhile, Manneh reiterated his appreciation of Rwanda’s achievements as the country is on track to meet all MDGs except the one related to nutrition. He said: “Rwanda is among only five countries in Africa that really meet all the goals. This is testimony to, of course, the leadership of this country.” editorial@newtimes.co.rw

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Govt calls on donors to end tied-aid policy