“I don’t beg. If a donor wakes up one morning and decides to withdraw support, it’s purely their decision. What I can do is say ‘thank you’ when they choose to support us and when they withdraw their support, I also say ‘thank you’.” - President, Paul Kagame at last week’s Presidential Press Conference.
Whether donors inject money to Rwanda’s economy or not it still a debatable. While some get panic attacks each time the Dutch, the Swedes and the Canadians take away their money, others just sit back and relax.
Two decades ago, who could predict that Zimbabwe’s economy would scramble to a Zim$ 250m legal tender? Who could possibly predict that by the end of last year the global world markets would tumble into its current financial mess?
The magnitude of the financial mess is too much for many to contemplate. With America already affected by the recession, which swept across Europe and Asia, Africa is yet to be directly affected, according to International Monetary Fund (IMF).
Imagine Africa had nothing to do with those unwise decisions. All that Africa did was to diligently export her goods, and yet it is predicted it is yet to suffer the consequences.
As a result the World Economic Forum met this year in Davos, Switzerland to devise ways of promoting economic growth during this financial downturn.
Davos and leaders there expressed their concerns about the continued flow of credit to developing countries and smaller countries which in Gordon Brown’s own words “are likely to be the biggest victims of the recession.”
The British Premier said, even if supporting our foreign operations it is very saintly and good, we also need to protect our domestic constituencies, not foreign ones.” This is where the doctrine of ‘protectionism’ starts.
The Americans messed but Asia is never made a fuss about it since the Tiger like Japan and China decided to pursue integrity by remaining credible and kind hearted. Japan even pledged some $100 billion to the IMF to support developing countries.
Anyway, since we don’t want to be the beggars, Rwanda’s leadership is painstakingly striving to break free from foreign aid dependency.
“We are building our capacity to depend less on foreign aid. We are focusing a lot on getting more revenue through increasing taxes in areas that will improve our capacity to sustain our economy,” said John Rwangombwa, the Permanent Secretary (PS) in the Ministry of Finance and Economic Planning.
Even though aid finances 50 percent of the national budget, the PS is optimistic that the situation will improve. Therefore, financial downturn or not, aid or not, throwing money at governments is certainly not the right way to make them financially stable.
It’s a matter of ‘survival for the fittest.’
It comes down to one thing, when looking for the money needed to pay for policies that improve the welfare of the citizens, governments should listen to domestic constituencies that include, the private sector and invest in policies that increase revenue in order to attain independence from foreign aid. My vote is for economic freedom .