The New Times (Kigali)

Rwanda: DRC Crisis - Rwanda's Rebuttal Was Ignored

The Government of Rwanda is concerned that the United Nations and development partners have paid little or no attention to its exhaustive rebuttal to the allegations that it is backing a rebellion in the neighbouring DRC, a senior official has said.

John Rwangombwa, the Minister of Finance and Economic Planning, faulted development partners who have either suspended or frozen aid to the country based on the conclusions of a highly contentious UN experts report, saying such punitive measures were based on politically motivated allegations.

He was speaking yesterday during a panel discussion on the first day of the East Africa Economists summit in Kigali.

The two-day forum, organised by Economist Conferences - part of The Economist

Group -, attracted international business leaders and policymakers to engage in frank and open debates on East Africa's economic prospects.

"We have submitted our rebuttal but our concern is that we haven't got any response on our rebuttal," Rwangombwa said, adding that donors' unilateral decision to withhold development aid to Rwanda based on a contested report does not only contradict the principle of fairness but also goes against the spirit of donor-recipient relations.

"This is completely in violation of the principles of aid effectiveness and partnership between the donors and the recipient countries," said Rwangombwa.

Responding to questions from the moderator Daniel Howden, Correspondent of the Economist Magazine, the minister expressed frustration about the way several development partners have taken decisions against Rwanda, without examining the country's response to the allegations.

The UN Group of Experts on DRC first accused Rwanda of backing the M23 rebels in an addendum to an interim report to the UN Sanctions Committee on June 21, 2012, after which Rwanda presented its rebuttal to the UN Sanctions Committee.

"Within our principles of Development Cooperation and rules of engagement with our development partners, if the donors are concerned with our behaviour, we engage each other through dialogue but whatever happens shouldn't affect our ongoing fiscal year plans," Rwangombwa explained.

However, in light of recent developments, he noted.

"It's now only the donor taking decisions over the recipient. And that's against the principle of aid effectiveness."

Rwangombwa conceded that the aid cuts will slowdown the country's ambition of achieving Vision 2020, even as he said the country was considering cutting its reliance on aid.

He said aid dependence was "very risky" considering the unpredictability of donors.

The Finance minister pointed out that out of US$362 million in aid that was expected in form of budget support, only US$122 million had been received.

He added that of the remaining $240 million, there is $125 million expected from the World Bank and $40 million from the African Development Bank, which the government is still convinced will be released by the two multinational bodies.

Nearly half of the country's budget is funded by donors.

With donor support, the government has lifted more than a million citizens out of poverty over the last five years.

The aid freeze has forced the Finance ministry to downgrade growth forecasts by 1 per cent. A recent study, commissioned by the British government - one of the donors who have frozen aid - named Rwanda among top effective users of aid, with the country maintaining its enviable status among the small club of least corrupt countries.

The summit, held under the theme, "Infrastructure and Growth: Government and Business in Dialogue", will also tackle trade barriers; youth and employment; and opportunities in ICT, technology, mining, transport and agriculture.

Participants will also discuss future trading prospects for East Africa in a globalised economy, including examining markets which will perform strongest in the coming years; the most compelling opportunities for investors; and the practical steps governments should take to ensure the region maximises its economic potential.

Tanzania's Prime Minister Mizengo Pinda called on East African countries to create an enabling environment for the private sector to grow to help wean themselves off aid.

"Developing infrastructure, promoting ICT development, regional integration and combating of corruption should be put at the forefront of the EAC (East African Community) economies," he said.

Stephane Paquier, President of Dow Chemical Africa, while observing that East Africa was the fastest growing region on the continent, underscored the great potential that exists in the EAC bloc which can be exploited to the benefit of the East Africans.

"We want to have a huge presence in the EAC countries because we see a lot of potential in the region's growth".

Dow Chemical Company connects chemistry and innovation with the principles of sustainability to help address many of the world's most challenging problems such as the need for clean water, renewable energy generation and conservation, and increasing agricultural productivity.

Economist Conferences is the leading provider of international forums for senior executives seeking new insights into strategic issues. These meetings include industry conferences, management events and government roundtables held around the world. The Economist Group is the publisher of The Economist magazine.

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