Remittances to hit US$103.1m, central bank says

Rwandans working and living abroad are expected to send more money home as the central bank projects projects remittances to increase by 4.9 percent from US$98.2m (Rwf58.1b) to US$103.1m (Rwf61.2b) as the economy recovers.Statistics from the central bank show that total remittances to Rwanda increased by five percent to $US25.7m (Rwf15.3b) in the first quarter of 2011 compared to $US24.5m (Rwf14.6b) in the same period last year.
Remittances up, helping o stabalise local currency (File photo)
Remittances up, helping o stabalise local currency (File photo)

Rwandans working and living abroad are expected to send more money home as the central bank projects projects remittances to increase by 4.9 percent from US$98.2m (Rwf58.1b) to US$103.1m (Rwf61.2b) as the economy recovers.

Statistics from the central bank show that total remittances to Rwanda increased by five percent to $US25.7m (Rwf15.3b) in the first quarter of 2011 compared to $US24.5m (Rwf14.6b) in the same period last year.

It an email statement to Business Times, the central bank said that the money comes from only workers who live abroad.

“It is an indicator that people have trust in the country’s economy. They have confidence while sending their money back home,” central bank Governor, Claver Gatete, said last week. 

The central bank expects the high remittance flows to have a strong influence on the stability of the Rwandan franc vis-a-vis regional currencies.

In 2010, the franc depreciated by two percent against the Kenyan shilling, six percent against the Tanzanian shilling and 14 percent against the Ugandan shilling. However, it appreciated by five percent against theBurundi franc.

While most of the remittances are invested in housing and financing small projects in the country, Gatete said that, they also constitute a key source of liquidity needed to stabilise the local banking industry and contribute to economic stability. 

The World Bank recently said that remittance flows to developing countries are expected to increase in 2011-13, but at lower and more sustainable rates compared to the period prior to the global financial crisis.

The Bank says that this is in line with a recovering but still fragile global economy.

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