Team to monitor global financial trends set up

In a bold move to control the possible impact of the ongoing global financial crisis on the Rwandan economy, government has appointed a committee to monitor the financial trends. The committee is comprised of representatives from Rwanda’s different financial institutions including commercial banks, Micro-Finance Institutions (MFI’s), insurance companies, Capital Market Advisory Council (CMAC) and the Social Security Fund of Rwanda (SSFR). The committee which also consists of representatives from the Ministry of Finance and Economic Planning, and the National Bank of Rwanda (BNR) will meet monthly to assess the actual and possible impact of the financial turmoil on Rwanda. The global financial crisis whose genesis is traced from the US sub-prime mortgage loans has led to the collapse of some large U.S. financial institutions, spreading to other financial institutions in Europe and Asia. The Minister of Finance and Economic Planning, James Musoni, yesterday said that the Rwandan economy is not yet affected by this global financial meltdown but expects it could be in the long run, depending on how the developed world manages the crisis. Governments in the wealthiest nations have come up with rescue packages to bail out their financial systems in order to avert a possible recession in the world’s largest economies. Analysts say that African nations could experience a fall in their export revenues and foreign aid if the crisis persists. “Rwanda is one of the countries that are in the global world,” Musoni said, warning that export receipts could go down and the country could also experience a fall in investments. Musoni, however, hastened to note that there are some positives to take from the international economic trends especially the fall of fuel prices on the international market which he believes will lead to the reduction of commodity prices on the local market and also ease pressure on inflation. He also said that as a way of risk diversion, some investors could turn to less risky nations like Rwanda which are not yet affected by the turmoil. According to Musoni, government has come up with various measures to avert the impact of the crisis on Rwanda’s financial institutions. They include limiting of capital flight, regulation and monitoring of financial institutions to make sure that none is exposed to risky international investments. This comes a week after the global finance ministers resolved to work together to overcome the current financial turmoil and its effects especially on rapidly developing countries and poor nations at risk of being swept up in the crisis. Ends