EDITORIAL: Keep calm, the economy is doing just fine

There is more to see in the latest economic figures released this week. The good news is that the country is well on its way to beat the 8.5 per cent economic growth projected by the International Monetary Fund (IMF).

This growth is mostly fueled by the services sector that accounts to about half of the growth.

All this is very good news and in normal circumstances and there is no need for the alarm bells simply because the county this month’s inflation figures spiked to 6.9 per cent, up from 4.4 per cent the previous month.

The other issue that seems to preoccupy the man on the streets is the rise in food prices which partly contributed in the rise of inflation. That could easily be explained, but sometimes our economists act more like messengers of doom because they don’t know how to simplify their figures and jargon.

The rise in inflation, even though the figure is not alarming at all, can be explained in a very simple manner; this is the time of the year when the country is depending on its food reserves as it awaits the harvest season next month. So it is understandable that when there is little to go around. Prices tend to go up, but there is nothing to be worried about.

The other thing that our economists fail to explain is that Rwandans have started falling in love with the export trade. The opening of new air routes to large and ready markets such as India and China makes it more attractive to export than take their produce to Kimironko Market.

All that is very elementary, so there is no need to go into overdrive over pseudo rising food prices, the economy is doing just fine. In fact, that should be more reasons to increase production since the markets are expanding as we have outgrown our domestic market.

editor@newtimesrwanda.com

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