Christmas season in Rwanda hits a brick wall owing to some economic challenges

• Rwandans are currently faced with an inflation crisis.
• Authorities are pressed to find a solution before heading into the new year. 
• This inflation is particularly daunting for the vulnerable within the country. 

Rwandan authorities have been on edge as a result of the country’s current economic state.

The cost of living in the country has experienced a spike that is being felt by the majority of its citizens, particularly the vulnerable household.

This, unfortunately, is not an isolated incident, as a number of African countries are experiencing some form of price inflation. For regions like Nigeria and Kenya, there is an increased cost of transportation and energy, but for Rwanda, the inflation is cutting across all sectors.

According to the International Monetary Fund, Rwanda is currently in a bit of a conundrum, owing to the fact that the country needs to revise and adjust its monetary policies to combat the recession issue. However, this in turn could negatively impact the country’s economic trajectory.

The National Institute of Statistics (NISR) revealed that the economy expanded by 10%in the third quarter, following 7.5% growth in the second quarter and 7.9% growth in the first.

“This year we had projected 6.8% by the end of December. But given the performance of the three quarters — all these indicators suggest that we may achieve more than 6.8%,” said Uzziel Ndagijimana, the minister of Finance and Economic Planning.

“In the next year, in the context of global challenges, we are conservative taking into consideration all these downside risks. Our projection for next year is 6.2% subject to adjustment depending on development in the global economy,” he added.

While the numbers have looked great through 3 quarters, the current rise in inflation could deter the economic rebound from the Covid-19 pandemic Rwanda was enjoying.

As a matter of fact, the economic rebound was thanks in large part to the full resurgence of the nation’s service sector, which fully resumed operations during the year. The sector experienced a 17% growth driven by conferences and exhibitions (MICE) and several international meetings.

For Rwandans, food prices have gone up alongside other basic amenities and the unemployment rate. This has put a dent in what should have otherwise been a strong annual finish for a country that was well underway to surpass its 2022 economic projections.