{"id":5381,"date":"2019-09-18T10:17:10","date_gmt":"2019-09-18T07:17:10","guid":{"rendered":"https:\/\/africasustainabilitymatters.com\/?p=5381"},"modified":"2026-01-11T05:30:33","modified_gmt":"2026-01-11T05:30:33","slug":"whats-behind-rwandas-double-digit-growth-rate","status":"publish","type":"post","link":"https:\/\/rayscohosting.best\/ASM\/2019\/09\/18\/whats-behind-rwandas-double-digit-growth-rate\/","title":{"rendered":"What’s Behind Rwanda\u2019s Double-Digit Growth Rate?"},"content":{"rendered":"\n

By Julius Bizimungu<\/em><\/strong><\/p>\n\n\n\n

Rwanda\u2019s economic\ngrowth grew by 12.2 per cent from April to June this year, compared to 6.7 per\ncent in the same period last year, according to the National Institute of\nStatistics of Rwanda.<\/p>\n\n\n\n

But what are the\nreasons behind this and what are the implications?<\/p>\n\n\n\n

While the growth was\ndriven by traditional key sectors \u2013 services, industry and agriculture \u2013 there\nare specific contributors that saw the economy grow at such a high rate.<\/p>\n\n\n\n

These include\nconstruction activity, retail and wholesale trade, as well as food crops, among\nothers.<\/p>\n\n\n\n

According to Ivan\nMurenzi, the Deputy Director General at the National Institute of Statistics of\nRwanda (NISR), for economies like Rwanda, it\u2019s normal to achieve double-digit\ngrowth.<\/p>\n\n\n\n

\u201cWe are a young\neconomy where everything tangible that happens in the economy can be felt. This\nis different from a developed economies where huge things must happen,\u201d he\nsaid.<\/p>\n\n\n\n

Construction was the\ntop contributor to the growth realised in the second quarter. Construction\nactivities expanded 32 per cent driven by mega government projects and a few\nprivate sector-led activities.<\/p>\n\n\n\n

\u201cIn quarter two, we\nsaw big construction projects happening and others completing. The growth in\nconstruction activity in quarter two would be attributed to major government\nprojects,\u201d Murenzi noted.<\/p>\n\n\n\n

Some of the projects\nhe highlighted include the recently completed Kigali Arena, the ongoing\nconstruction of Bugesera International Airport, and several road networks being\nundertaken by the Government.<\/p>\n\n\n\n

The growth in\nconstruction increased demand in mining and quarrying activities like sand and\nstones, which during the same period grew by 36 per cent.<\/p>\n\n\n\n

Murenzi said that they\nhave seen construction being closely linked to other activities like\nmanufacturing, indicating that some domestic manufacturing factories, for\ninstance, achieved a turnover of more than 43 per cent of their output.<\/p>\n\n\n\n

Indeed, manufacturing\ngrew at 16 per cent, thanks to increased production of metallic (like metal\nbars) and non-metallic (mainly cement) construction materials, as well as\nchemicals and plastic products.<\/p>\n\n\n\n

Production of cement\nin Rwanda in this quarter grew by about 65 per cent.<\/p>\n\n\n\n

Production of metallic\nand non-metallic construction equipment increased by 43 per cent and 42 per\ncent, respectively. Chemicals and plastic products increased by 32 per cent\nowing to increased growth of paints and soaps.<\/p>\n\n\n\n

The official said\nconstruction is also linked to imports, reflecting why imports of construction\nmaterials and petroleum products increased by 32 per cent.<\/p>\n\n\n\n

However, Murenzi\nsuggests that most of the imported products are capital goods, which he said\n\u201care good for the future of the country\u201d.<\/p>\n\n\n\n

\u201cThese capital goods\nmake sense because they bring returns in the future. You are talking about\nproducts used to construct establishments like Kigali Arena,\u201d he said, adding\nthat construction is also linked to transport, since more goods are being\ntransported from one place to another.<\/p>\n\n\n\n

Wholesale and retail\ntrade activity, basically the distribution of goods, was another top driver. it\ngrew 23 per cent.  <\/p>\n\n\n\n

He said: \u201cSome things\nare not independent, they are interconnected. But some others shake much.\u201d<\/p>\n\n\n\n

Another outstanding\nactivity was the increase in food crops, a field that contributes more than 60\nper cent to the entire agriculture sector.<\/p>\n\n\n\n

Food crop production\ngrew by 4 per cent and contributed 0.6 per cent to the overall economic growth.<\/p>\n\n\n\n

Generally, this\nimplies that more jobs were generated and more private sector activities were\ntaking place as a result of the growth, and this could be seen through the\nperformance of services such as the financial sector.<\/p>\n\n\n\n

Credit provided by\nfinancial institutions to the private sector in the same quarter grew\nsignificantly, according to Murenzi.<\/p>\n\n\n\n

Typically, financial\ninstitutions like banks drive the economy through a number of ways, one of\nwhich Maurice Toroitich, the Managing Director of BPR Atlas Mara, says is\nthrough the provision of private capital.<\/p>\n\n\n\n

\u201cBanks provide capital\nfor investment and trading which in turn creates demand by the market for goods\nand services. This demand fuels growth in economic activity,\u201d he noted.<\/p>\n\n\n\n

Read Original\nArticle<\/a> on The New Times<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Julius Bizimungu Rwanda\u2019s economic growth grew by 12.2 per cent from April to June this year, compared to 6.7 per cent in the same period last year, according to the…<\/p>\n","protected":false},"author":3,"featured_media":5382,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","pagelayer_contact_templates":[],"_pagelayer_content":"","_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[101],"tags":[],"class_list":["post-5381","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-international-news"],"_links":{"self":[{"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/posts\/5381","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/comments?post=5381"}],"version-history":[{"count":0,"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/posts\/5381\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/media\/5382"}],"wp:attachment":[{"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/media?parent=5381"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/categories?post=5381"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/rayscohosting.best\/ASM\/wp-json\/wp\/v2\/tags?post=5381"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}