Treasury plans to raise Rwf12.2 billion in the next fiscal year by selling some state owned comapnies as it steps up efforts to raise resources for financing development.The companies that are lined up for privatisation in the next fiscal year, which begins in July 2012, include two tea factories, Shagasha and Mulindi.The proceeds are expected to be invested in the Kigali Convention Centre and the national carrier, RwandAir, as part of the plans to position the country as a regional service hub.In 2009 a research by On-The-Frontier Group (OTF) a consulting firm on competitiveness revealed that the country has potential to raise US$40 million from Meetings, Incentives, Conferences, and Exhibitions (MICE) tourism.Kigali has in the recent past witnessed a surge in the number of international meetings and conferences, a phenomenon that is partly driving the increase in both private and public investment in hotel and conference rooms.According to the budget framework paper, a large portion of the estimated expenditure will be used to finance the operations of the national RwandAir.Government is expected to continue spending on the aviation industry by increasing investment in RwandAir, expansion of Kigali International Airport and the construction of a new airport in Bugesera District. The Bugesera Airport project is particularly priority for government to cater for the growing air traffic at the Kigali International Airport. This year, Rwanda has so far attracted airlines like South African Airways, Qatar Airline and the Turkish Airlines.Figures from Rwanda Civil Aviation Authority show that last year aircraft movement reached a 17,272 from 9,406 in 2007. Kigali International Airport registered 376,918 passengers in 2011 compared to 238,909 in 2007.Treasury also plans to borrow further in next year to finance large and strategic investment projects. “The new borrowing limit however will not compromise debt sustainability in the medium to long term” the Budget Framework Paper reads in part.Domestic revenue is projected to rise from 14 per cent of GDP in 2012/2013 to 14.3 per cent of GDP in 2013/2014. Government says it will explore all avenues for concessional financing, but because of the large requirement of resources for the financing of the development agenda, non concessional financing will be the second option.
