Musoni presents the 2008 budget

KIGALI - As the Minister of Finance and Economic Planning, James Musoni, presented the 2008 budget proposals to Parliament yesterday, MPs questioned the productivity of the methane gas project arguing that much was being spent on generators which constitute a short term solution. “We have been hearing about the Methane Gas project for the last three years but up to now we are still spending on hiring generators and their fuel. When is this project going to yield?” MP Mike Rugema queried. In the new budget proposals, Musoni earmarked Frw5bn for the maintenance of the two gigantic generators that were hired to solve the power problem in Kigali City. The Ministry of Infrastructure (MININFRA), which is responsible for energy production among others, had its budget increased by 23 percent from Frw79bn to Frw100bn. Other parliamentarians said that instead of spending more money on the various energy projects especially hydro-electricity, all resources should be concentrated on the extraction of methane gas from Lake Kivu in Western Province. “We have heard many hydro-electric power projects that are planned on this budget, but we have not heard of what we are supposed to get from Kivu (methane gas), why aren’t all resources pooled to the methane project?” another MP, Juvenal Nkusi, wondered. However, Musoni said that the paramount reason for power problem in the country was a result of concentrating on one source. “We need to diversify our sources of power. The reason we encountered all these problems was because of entirely depending on Hydro-electric energy but now we want to look at all directions to ensure that the problem is solved once and for all,” Musoni told MPs. He said that there is research being carried out by an Indian firm on how much energy that is likely to be generated from Kivu and the report is expected before the end of the year. He explained: “There are investors ready to inject money into the project but we need to find out how much can be generated. For instance, there is an American firm that is ready to extract 100 megawatts another German firm will generate 50 megawatts and others, we need to first know how much can be extracted.” He promised that within the coming few years, at least 50 megawatts will be generated from the project, while the Nyabarongo Hydro- power project will within one year produce 28 megawatts. Other MPs asked when the Rwandan budget will be integrated into the East African Fiscal System, and Musoni said it will be adopted next in accordance to the agreement that Rwanda signed. In the East African Fiscal system, EAC member countries present their budget proposal simultaneously in June of every year. On worries of inflation emanating from importing many commodities, Musoni said that the government plans to put much emphasis on the use of Treasury Bills to reduce the circulation of money. MP Aaron Makuba raised concern on the persistent increases on the household products during the course of this year. “People can hardly afford household products like salt or sugar because of the overwhelming increment in the prices,” Makuba said. However, Musoni said that no increments were projected during next year as the major reason was because of the importation of fuel for the power generators which is expected to reduce. Asked on the government’s plans to recover funds from students who studied on government scholarships, Musoni said that the campaign which starts next month is expected to pool at least Frw15bn during the first three years. The money will be used in building capacity in institutions of higher learning, he said. Through the Students Financing Agency of Rwanda (SFAR), government will soon start reclaiming its money from students who studied on government grants. The budget proposals were later unanimously endorsed and will be scrutinised by the Standing Committee on Budget before approval. Ends

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Musoni presents the 2008 budget