Rwanda Foreign Investment Down on Global Outlook, Ebola FearSaul Butera
Foreign direct investment in Rwanda fell last year because of the uncertain global outlook and a reduction in business travelers to the country that the government blamed on an Ebola outbreak on the other side of Africa.
The country attracted $390 million in projects, compared with $445 million a year earlier, Francis Gatare, chief executive officer of the state-run Rwanda Development Board, said in an interview.
“Global economic trends like reduced commodity prices, rising costs for manufactured products and general global uncertainty” explain the 12 percent decline in FDI, Gatare said on Monday in the capital, Kigali. “Ebola is an indirect cause due to bad publicity for all of Africa.”
Two decades after a genocide that killed 800,000 people, or a tenth of the country’s population, Rwanda has become the 10th-fastest growing economy in the world with an average 8 percent annual expansion in the decade through 2010, according to the International Monetary Fund. The landlocked, coffee-producing nation has since the 1994 genocide introduced regulatory and social reforms to become the first African nation to be the World Bank’s top business reformer in 2010.
While championing the economy, Rwandan President Paul Kagame has been criticized by groups including Human Rights Watch and Amnesty International for stifling opposition.
The nation mainly drew smaller-scale projects valued at $20 million or less last year, which are expected to create 10,000 jobs, said Gatare. The biggest investment was a $157 million commitment by U.S.-based Symbion Power for a 50-megawatt methane-gas project at Lake Kivu, in the west.
An Ebola outbreak, centered in three West African nations, could inflict $3 billion to $4 billion of losses across sub-Saharan African, disrupting regional trade networks and tourism, according to the United Nations. The death toll in the outbreak rose to 8,429 out of 21,296 recorded cases as of Jan. 14, mostly in Sierra Leone, Liberia and Guinea, according to the World Health Organization. No cases have been recorded in Rwanda since the virus was first identified in 1976, in what is now Democratic Republic of Congo, the WHO says.
Rwanda’s economy is forecast by the IMF to expand 6.7 percent this year, more than double that of advanced economies and faster than the sub-Saharan African average of 4.9 percent. Rwandan Finance Minister Claver Gatete said last month that expansion is targeted to exceed 7 percent this year.
IMF Managing Director Christine Lagarde will visit the country from Jan. 26 to Jan. 29 to discuss the economy, which she calls one of the success stories in Africa, according to a statement from the Washington-based lender on Jan. 16.