The economy appears firmly back on a strong upward trajectory with a gross domestic product (GDP) growth rate of 7.8 per cent during the third quarter of the year, way above the government’s projections of 6 per cent.
Services and agriculture sectors remain the main drivers of growth, accounting for 47 per cent and 34 per cent of GDP (the value of all goods and services), respectively.
Figures, released yesterday by the National Institute of Statistics of Rwanda (NISR), show that the economy generated goods and services worth Rwf1,393 billion, up from Rwf1,233 billion produced during the same period in 2013.
NISR director-general Yusuf Murangwa said the industrial sector also performed well; contributing 14 per cent of GDP, while 5 per cent came from taxes less subsidies on all products.
Growth in agriculture productivity was mainly attributed to good performance in the second season that saw production of food crops up by 7 per cent, according to the Minister for Finance and Economic Planning, Amb. Claver Gatete.
Amb. Gatete said given the GDP growth rate in the first, second and third quarters, “we can reaffirm that economic growth will be way above 6 per cent.”
Signs of economic rebound from the 2013 slowdown started to appear in the first three months of this year when the economy grew by 7.4 per cent and 6.1 per cent in the second quarter—a big leap from 4.7 per cent of the previous year.
The annual growth rate figures for 2014 will be released in March.
The economic activities that drove growth in the industry sector were mainly mining, quarrying and construction.
However, growth in the manufacturing sector declined by 5 per cent due to increased cost in importation of raw materials as well as low production of cereals, a major raw material in local manufacturing.
In terms of growth by activity, agriculture grew by 6 per cent and contributed 1.8 percentage points to the overall GDP growth rate of 7.8 per cent. The industrial sector expanded by 4 percent; while service sector increased by 10 per cent, adding 5 percentage points to the GDP growth rate.
Murangwa said provisional figures show that imports increased by 6 per cent at constant 2011 prices while exports increased by 3 per cent.
Rwanda’s economy has maintained average growth of 8 per cent in the past 10 years save for last year’s slowdown attributed to delays and suspension in disbursement of donor aid in 2012.
According to the second Economic Development and Poverty Reduction Strategy, government projects an annual economic growth rate of 11.5 per cent by 2018.
This will help propel the country into a middle income economy with the GPD per capita of $1,240.