The Government has said that it will increase funding to the national carrier RwandAir to Rwf145.1 billion in the 2020-21 fiscal year, up from Rwf121.8 billion this financial year.
This is meant to help the airline to respond to the impact of the COVID-19 pandemic.
The funds are also meant to facilitate the airline to continue its expansion plan, including the acquisition of new planes and opening new routes. RwandAir has been affected by the pandemic due to the travel bans countries have imposed on travellers across the world.
The company suspended all commercial flights when Rwanda barred all commercial airlines to enter the country.
To remain afloat, RwandAir has employed a range of measures, including reduction of salaries of employees.
The company reportedly put on hold contracts of some pilots and non-essential staff until further notice.
The Minister for Finance and Economic Planning, Uzziel Ndagijimana, said that the transport sector is among those hit the hardest by the pandemic.
Last year, 12 per cent of transport services grew 12 per cent boosted mainly by a 17 per cent increase in air transport activity.
However, the sector is expected to contract by 1.9 per cent in 2020.
Some Rwf240.4 billion will go to the transport sector during the next fiscal year.
The Government will generally spend Rwf3.2 trillion in the next financial year, up from the revised budget of Rwf3 trillion.
Meanwhile, the Government said it will recapitalise the Development Bank of Rwanda (BRD) to enable it to scale up its support to the private sector.
Up to Rwf7.2 billion has been earmarked for the financial institution in the upcoming 2020-21 fiscal year.Follow https://twitter.com/Julio_Bizimungu