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afrol News, 10 August - According to an IMF assessment, the Rwandan government has presented a "comprehensive" and "innovative" Poverty Reduction Strategy Paper (PRSP), which documented a "commitment" to tackle the country's problems. The PRSP will form the basis for policies in years to come and provide Rwanda with IMF and World Bank credits. The International Monetary Fund (IMF) yesterday published its "Joint Staff Assessment" of Rwanda's poverty reduction strategy. The assessment leaves it clear that the Rwandan government has delivered a strategy dedicated to sustainable poverty reduction. The "comprehensive" paper provided a "frank discussion", a "comprehensive strategy" and was "innovative in linking its analysis and strategies to traditional decision and problem resolution systems." The Rwandan government's intention is to update the PRSP every two years, along with annual updates to reflect evolving circumstances and ensure that it remains on course. As a part of this process, the government plans to conduct regular surveys. The government's effort in putting together the PRSP was "highly commendable and further efforts will be needed to refine the proposals to facilitate implementation," the IMF says. "The participation in the PRSP process and sense of ownership are impressive. The PRSP has articulated a strategy of social and economic transformation that Rwanda needs to make the transition to peace, stability and development." While the broad thrust of the strategy was "clear" and sectoral strategies were "well articulated in some areas," for instance education, HIV/AIDS, technology and health, in other sectors – transportation, rural development, private sector, financial sector, institutional capacity building, the way forward was "less clear." The Rwandan authors recognised this gap and have proposed a program for elaborating sector strategies. The IMF staff suggested that this effort should put emphasis on strategies for cross-cutting areas such as environment, private sector development including the financial sector, and capacity building. The country ownership of the PRSP process had been "consistently strong," the IMF writes. The PRSP process had been well received in Rwanda, "a country with a tradition of consultation." Countrywide consultations undertaken in the course of 1999 and 2000 had identified poverty as a major obstacle to national reconciliation in Rwanda, confirming the link between poverty and national reconciliation. As a result, "government officials at all levels have embraced poverty reduction as the key objective of government policy." The PRSP had been "written with the Rwandan population as the primary audience" and it was therefore quite elaborate. The authorities had conducted the PRSP process in "a very open way," working closely with other representatives of civil society. The progress reports had been shared with a large group of people in Rwanda and elsewhere by e-mail. "While the Rwandan welcomed the contribution from outsiders, they relished the opportunity to articulate their own vision and ideas to the world." The government plans to publish the PRSP in English, French, and Kinyarwanda, make it publicly available and conduct workshops and other consultations on the implementation of the strategy. "The wide dissemination will promote a continuing and constructive public debate on poverty reduction and public policy and performance," IMF says. The PRSP aims to reduce poverty to less than half the 2001 level by 2015. The paper set out a private sector-led growth strategy and identified the transformation of agriculture and the rural economy as the engine of growth in the medium term. Six broad priority areas were identified by the Rwandan government to reach the ambitious goals: rural development and agricultural transformation; human development; economic infrastructure; good governance; private sector development; and institutional capacity building. The IMF staff agreed with the overall growth strategy and welcomed "the emphasis on agriculture and rural development and on increasing the effectiveness of public actions." The IMF holds that the PRSP's poverty reduction goals are "very challenging, requiring exceptional efforts." The poverty reduction target would require average annual growth of real GDP of 7-8 percent over a sustained period. The IMF however believes that this target would be "difficult to reach by 2015." The PRSP average growth projections for next 15 years of about 6 percent, while consistent with recent performance, were "still ambitious as conflicts and insecurity in Rwanda and neighbouring countries could continue to undermine the effective use of resources and deter the investments that are needed to achieve and sustain such growth rates." The overall assessment of the IMF staff was that "this PRSP provides a sound basis for Bank and Fund concessional assistance and for debt relief. The staffs recommend that the respective Executive Directors of the World Bank and the IMF reach the same conclusion." This is likely to mean that Rwanda very soon will obtain new credits and debt reduction from the IMF and the World Bank.
Sources: Based on IMF and afrol archives
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