4 December 2012

Rwanda Must Achieve Much With Less - Minister Rwangombwa

Photo: Steve Terrill
Receiving aid (file photo).

The country will remain stable despite the fact that various development partners have decided to withhold their aid to Rwanda, Finance and Economic Planning minister John Rwangombwa has said. According to minister Rwangombwa, his ministry had expected 7.4 per cent economic growth rate but aid cuts will reduce that by 1 per cent making it 6 per cent.

"This is if nothing is done," Rwangombwa told lawmakers while appearing before the parliament both chambers to discuss the issue of aid cuts yesterday. He said that among the measures taken to survive the aid cuts is enhance the efficient use of resources.

"We must achieve much with less," he said adding that so far, about US$ 362.7 million was expected for the fiscal year 2012/2013.

"Now only a total of US$122.4 million has been released with US$ 240 million not yet released. A big chunk of this amount has been suspended. These include US$ 9.5 million suspended by Germany, US$ 6.7 suspended by The Netherlands, and US$ 36 million recently suspended by the Britain," Minister Rwangombwa said.

World Bank and Africa Development Bank have delayed the release of US$ 125 million and US$ 40 million respectively.

"But we hope that these ones are still waiting for their superiors to confirm that they will send or not their aid. If they send it, the aid cuts percentage will fall to 5 per cent. It was not released due to pressure, which might make even delay longer."

However, Minister Rwangombwa said that some of those development partners like the European Union have sent their aid.

"The UK had sent in the first phase US$ 44 million," said Rwangombwa who further added that some donors only blocked budget support but have released all sector support as planned. "It's unfortunate that some countries cut/delayed aid based on a questionable draft report by the UN Group of Experts," he said.

The story behind Aid cut-not 'really' DRC or M23

The minister revealed that although most of the donors declared the Eastern DRC unrest and accusations against Rwanda as reasons behind their aid cut, there must be other stories behind the freeze. According to Rwangombwa, there is an ongoing campaign in Europe for donors to cut their aids to developing countries.

For example, he said Belgium has not released its Rwanda funding due to cuts in internal austerity measures and not DRC or M23 related reasons.

He also said Western Media has an agenda to blackmail Rwanda amidst these untimely aid suspensions, citing Channel 4 of UK, which sent journalists to Rwanda recently to assess how their country's aid is used. "British media had been awash with stories about Rwanda in the time that led to the decision to suspend 21 million pounds. Channel 4 journalists came here and when they went back, they didn't mention anything in what we had explained and showed them," he said.

Finance Minister told lawmakers that a reviewed 2013 budget will be submitted to parliament in January 2013 without including donor resources.

"We will revise spending in some areas but major programs won't be affected by suspensions which account for 12 per cent (Rwf 155 billion) of the total budget (Rwf 1,385 billion). This will not hamper government plans."

He addressed rumors that public servants salaries will delay and said that, "We have a budget of Rwf 224 billion for public servants salaries. Domestic taxes (Rwf 645 billion) alone are a double of civil servants salaries, so we shall never fail to pay government employees," Rwangombwa said, adding that Rwanda financial reserves are able sustain all plans for the fiscal year 2012-13 without foreign aid.

"DRC has become a blessing in disguise, a wakeup call for Rwandans and Africans to find ways to live off aid. Beyond DRC crisis we need to draw a lesson and plan on how we can do without foreign aid. African countries should seek ways of weaning themselves off aid, since it has become a tool for manipulation and control."

Rwanda finance minister said he has 88 per cent of all resources needed for 2013 budget. "That's like a student attaining a distinction," he said.

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