Rwanda records strong economic growth in 2021
Rwanda recorded strong economic growth in 2021 compared to the previous year, the World Bank said in the 18th Rwanda Economic Update Report released Wednesday in the Rwandan capital, Kigali.
Rwanda’s GDP grew by 11.1% in the first nine months of the year, reflecting a broad recovery from the 2020 recession, according to the report.
Industrial production increased by 16.5%. Favorable weather conditions led to a 6.8% increase in agricultural production, and the easing of mobility restrictions contributed to an 11.1% increase in services, with hotel-related services starting to recover in the second quarter, he added.
While GDP is close to pre-pandemic levels, the employment-to-population ratio (16+) is 8% lower and the unemployment rate more than 13 percentage points higher than early 2020 levels, according to The report.
According to the report, one of the reasons for the lagging jobs recovery is that faster growth partly reflects the movement of workers to higher productivity jobs, including manufacturing and construction, rather than widespread increases in corporate output.
Employment conditions have deteriorated sharply for women, with the unemployment rate for women now 13.6 percentage points higher and the unemployment rate for men 7.7 percentage points higher than in the first quarter of 2020 , he said.
The report said traditional exports, including coffee and tea, grew by around 35% in the first nine months of 2021 and tourism also improved compared to the same period a year ago. year.
Imports have recovered with faster growth in domestic demand, but at a slower pace than exports, the report said, it added.
The World Bank has predicted that Rwanda’s GDP will moderate over the next two years.
Growth in services is expected to accelerate with a recovery in international tourism, while industrial activity is expected to firm up with government support through the “Manufacture and Build to Recover Programme”, according to the report.
Inflation is expected to rise with rising global demand, commodity prices and domestic economic activity, but remain within the National Bank of Rwanda’s target range.
The report recommended that regional integration offers significant benefits for Rwanda, including greater potential for economies of scale, opportunities to learn to export and produce higher quality goods, and cooperation to improve trade facilitation.
The growth of the Rwandan economy fell to 2.3% for the financial year 2019-2020, against 8.8% the previous year, as the outbreak of COVID-19 dealt a severe blow to the country’s economic activities.
Last year, Rwanda expected its economy to grow by 5.1% in 2021.