Government is to increase investment under the Economic and Poverty Reduction Strategy (EDPRS) by Rwf1.8 billion in the next financial year that begins on July 1 as it steps up efforts to end poverty.
According to the budget framework paper, government spending through the national poverty reduction policy is expected to reach Rwf5. 2 billion from Rwf3.4 billion in 2011/12.
The 2012/13 fiscal year is the last year of the implementation of the EDPRS II after the completion of Phase One early this year.
Government plans to raise more domestic revenues as it attempts to reduce the fiscal deficit.
Total grants for the 2012/2013 budget are estimated to be Rwf540.9 billion, which is equivalent to 11.4 per cent of the GDP as opposed to Rwf463.5 billion in 2011/2012.
According to the budget framework paper, the funds will be invested in areas that lag behind towards poverty eradication as indicated in the recently concluded Income and Household Living Conditions Survey.
According to the survey, which was released early this year, poverty levels in the country dropped by 11.8 per cent since 2006, six times faster than that achieved between 2000 and 2006.
The survey covered living conditions, income, expenditures, poverty, housing conditions education and employment.
Some of the target areas include infrastructural development especially energy generation to boost rural development, scaling-up market access by doubling investment in feeder road network and creating off-farm employment focusing mainly on SMEs development.
The report indicated that over 200,000 households, equivalent to one million people, have emerged from poverty since 2006.
The infrastructural cluster is expected to receive Rwf678 billion up to the end of EDPRS and this has been raised to Rwf1, 173 billion in the 2012/13 budget, 22 per cent of the total budget.
Some of the challenges highlighted to be addressed in the EDPRSII include access to service across districts, high population growth, and malnutrition.
The increased budget for EDPRS will go along with the high GDP per capita which is projected to jump from US$900 to US$1,240 by 2017.
However, to achieve this target, the country needs to record at least an average economic growth rate of 11.5 per cent, which was not possible in the last decade. The country recorded an average economic growth rate of 8.5 per cent in the last decade.
The target comes in the midst of various global economic challenges with weak demand, low commodity prices and high food and oil prices.
The budget framework paper, which was approved by cabinet, recently says that one major area that will need concerted efforts is to control population growth rate while ensuring a productive population.