## IMF Executive Board Approves $319 Million Arrangement for Rwanda Under the Resilience and Sustainability Facility, Plus a New Policy Coordination Instrument _IMF News, December 12, 2022_ ## Source details **Canonical URL:** [IMF Executive Board Approves $319 Million Arrangement for Rwanda Under the Resilience and Sustainability Facility, Plus a New Policy Coordination Instrument](https://www.imf.org/en/news/articles/2022/12/12/pr22426-imf-executive-board-approves-319-million-arrangement-for-rwanda) ## Other formats - [Markdown version](/en/news/articles/2022/12/12/pr22426-imf-executive-board-approves-319-million-arrangement-for-rwanda/index.md) - [Structured JSON version](/en/news/articles/2022/12/12/pr22426-imf-executive-board-approves-319-million-arrangement-for-rwanda/index.json) - [Bundle manifest](/en/news/articles/2022/12/12/pr22426-imf-executive-board-approves-319-million-arrangement-for-rwanda/bundle-manifest.json) ## Bibliographic details - Published: December 12, 2022 --- ### Approval and financing - The Executive Board approved an arrangement for Rwanda under the Resilience and Sustainability Facility (RSF) amounting to SDR 240.3 million (about US$ 319 million, or 150 percent of quota). - Rwanda is the first African and low-income country to secure access to the RSF. - The Executive Board also approved a new 36-month Policy Coordination Instrument (PCI). ### Objectives and scope of the RSF-supported program - Support Rwanda’s agenda to build resilience to climate change and help catalyze further financing. - Improve transparency and accountability in the planning, execution, reporting, and oversight of budget resources dedicated to addressing climate change. - Facilitate green public investment, create further fiscal space, mitigate financial risks, and strengthen public debt dynamics and prospective balance-of-payments stability. - RSF reforms are expected to: - Strengthen and institutionalize monitoring and reporting of climate-related spending. - Integrate climate risks into fiscal planning. - Improve the sensitivity of public investment management to climate-related issues. - Strengthen climate-related risk management for financial institutions. - Strengthen disaster risk reduction and management. - Disbursements under the RSF will be contingent on conclusion of relevant reviews under the new 36-month PCI and implementation of scheduled reform measures agreed as part of the RSF arrangement. ### Policy Coordination Instrument (PCI) - New PCI term: 36 months. - Purpose: support the authorities’ economic policy and reform agenda designed to maintain macroeconomic stability and foster more inclusive growth. - The new PCI replaces an instrument approved on June 28, 2019. - Program performance under the 2019 PCI: all quantitative and standard continuous targets through end-June 2022 met, and all but one of the reform targets through end-September 2022 completed. - The new PCI places greater emphasis on policies to ensure macroeconomic stability, mitigate pandemic scars, build socioeconomic resilience to shocks, and insure against downside risks. ### Key recommendations and authorities’ policy priorities (from Deputy Managing Director Bo Li) - Timely implementation of a fiscal strategy and adoption of domestic revenue mobilization measures envisaged under the medium-term revenue strategy. - Launch a spending rationalization strategy to enhance credibility of fiscal consolidation and safeguard debt sustainability. - Strengthen capacity to manage fiscal risks and adopt more effective and transparent public financial and investment management practices. - More decisive monetary tightening by the National Bank of Rwanda (NBR) to contain inflationary pressures. - Ensure greater exchange rate flexibility for external stability. - Continue monitoring the financial sector while deepening financial markets and promoting financial inclusion. - Build socioeconomic resilience through adaptive social safety nets, human capital investments, economic diversification policies, and climate resilience reforms. ### Program conditionality and links to financing - RSF disbursements contingent on relevant PCI reviews and implementation of scheduled RSF reform measures, which establish Rwanda’s broad economic reform goals. - The PCI is available to IMF members that do not need extensive Fund financial resources at the time of approval and is designed for countries seeking to demonstrate commitment to a reform agenda or to unlock and coordinate financing from other official creditors or private investors. ### Selected macroeconomic and fiscal indicators (annual percentage change, unless otherwise indicated; series as presented) - Real GDP: 9.5, -3.4, 10.9, 6.0, 6.8, 6.7, 6.2, 7.0, 7.5, 6.1 - GDP deflator: 2.5, 2.7, 9.3, 11.9, 8.7, 7.4, 5.5, 5.3, 5.4, 5.2, 5.0, 5.1 - CPI (period average): 2.4, 7.7, 0.8, `112.6, 8.0, 7.9 - CPI (end period): 3.7, 1.9, 8.8, 17.1, 6.5, 3.4 - Terms of trade (deterioration, -): -1.8, -0.9, 3.9, 11.1, -2.9, -7.5, -2.1, 0.3, -1.3, 0.7, -0.4, 0.2, -0.3 - Exchange rate (Rwanda franc/US$) (end of period): 922.5, 972.5, 1,009.6, 1,085.3, 1,060.0, 1,155.9, 1,134.2, 1,213.7, 1,207.9, 1,268.3, 1,279.2, 1,319.0, 1,331.6, 1,358.6, 1,383.5 - Exchange rate (Rwanda franc/US$) (period average): 899.5, 943.3, 988.9, 1,047.5, 1,034.8, 1,120.6, 1,097.1, 1,184.8, 1,171.0, 1,241.0, 1,243.5, 1,293.7, 1,305.4, 1,332.5, 1,357.6 - Broad money (M3) growth: 15.4, 18.0, 17.8, 15.8, 19.5, 14.2, 12.3, 15.0, 15.5, 11.4, 11.5 - Reserve money growth: 16.0, 21.7, 30.7, 8.1, 12.2, 10.3 - Credit to non-government sector: 12.6, 21.8, 14.7, 11.0, 10.8, 13.7, 21.3, 21.2, 19.4, 25.7, 10.7, 17.6, 14.5, 16.9 - M3/GDP (percent): 29.4, 30.4, 29.9, 30.5, 31.2 - Budgetary central government, FY basis — Revenue (percent of GDP): 23.1, 23.3, 25.0, 25.3, 25.9, 24.6, 23.6, 22.9, 23.2, 24.1, 23.8, 24.2 - Taxes (percent of GDP): 15.7, 15.9, 16.5, 17.3, 17.2, 17.5 - Grants (percent of GDP): 6.9, 6.6, 4.4 - Expense (percent of GDP): 20.5, 20.2, 20.3, 20.6, 19.3, 18.2, 18.6, 18.4, 18.1, 17.0 - Net acquisition of nonfinancial assets (percent of GDP): 11.2, 12.4, 11.6, 9.6, 9.9, 10.1, 10.2 - Net lending (+) / borrowing (-) (NLB) (percent of GDP): -8.6, -7.9, -7.6, -6.3, -5.7, -6.9, -4.9, -5.6, -4.7, -3.2, -3.0 - NLB excluding grants (percent of GDP): -11.6, -12.4, -13.0, -13.5, -13.2, -12.1, -9.3, -10.0, -8.8, -9.2, -7.4, -7.3, -6.7 - Net incurrence of liabilities (percent of GDP): 6.4, 8.9, 9.0, 10.4 - Domestic (percent of GDP): 2.2, -0.5, 1.8, -0.6, 1.7 - Foreign (percent of GDP): 8.6, 6.3, 3.2 - Overall fiscal balance (incl. grants, policy lending) (percent of GDP): -8.1, -9.1, -8.7, -6.1, -6.5, -5.2 - Public debt — Total public debt incl. guarantees (percent of GDP): 56.8, 72.4, 73.3, 73.1, 71.3, 75.2, 73.9, 75.9, 76.8, 74.2, 77.3, 73.6, 75.7, 71.7 - External public debt incl. guarantees (percent of GDP): 44.3, 56.4, 54.5, 57.6, 53.0, 58.0, 55.9, 60.8, 60.1, 63.1, 59.1, 62.5, 62.1 - External public debt incl. guarantees, PV (percent of GDP): 29.7, 34.0, 34.9, 36.1, 33.6, 38.2, 35.8, 39.2, 38.9, 38.7, 40.4, 37.6, 39.9, 35.7, 39.5 - Total public debt incl. guarantees, PV (percent of GDP): 42.9, 51.1, 54.4, 52.7, 56.6, 55.0, 55.3, 56.1, 53.7, 55.8, 52.9, 53.9, 51.3, 52.1 - Investment (percent of GDP): 23.5, 25.1, 26.3, 25.8, 24.5, 28.4, 29.0, 28.6, 29.5, 28.9, 28.2, 28.1 - Savings (excl. grants) (percent of GDP): 16.3, 15.6, 17.7, 0.9, 4.3, 10.0, 13.0, 14.9, 14.4, 13.4 - Exports (goods and services) (percent of GDP): 18.9, 19.1, 23.4, 27.1, 28.5, 26.6, 28.8, 26.7, 29.2, 27.0 - Imports (goods and services) (percent of GDP): 35.1, 34.8, 41.7, 40.0, 41.2, 41.1, 40.8, 41.4, 40.9, 40.2, 38.5, 40.1, 38.0 - Current account balance (incl. grants) (percent of GDP): -11.9, -10.9, -12.6, -10.5, -11.7, -8.9, -11.0, -7.7 - Gross international reserves (In millions of US$): 1,382, 1,722, 1,889, 1,868, 1,894, 1,869, 2,052, 2,063, 2,309, 2,093, 2,378, 2,229, 2,442, 2351, 2643 - Gross international reserves (In months of next year's imports): 5.6 - GDP at current market prices — Rwanda francs (billion), CY basis: 9,314, 9,607, 10,944, 12,672, 13,075, 14,698, 14,904, 16,585, 16,880, 18,800, 19,083, 20,942, 21,429, 23,340, 23,898 - Nominal growth (percent): 13.9, 14.0, 13.3, 13.1 - Population (million): 12.7, 13.6, 14.8 *Source: IMF Executive Board press release, December 12, 2022.* --- ## References - [PRESS CENTER](http://presscenter.imf.org/) - [Rwanda and the IMF](http://www.imf.org/external/country/RWA/index.htm) - [IMF-World Bank Debt Sustainability Framework for Low-Income Countries -- A Factsheet](https://www.imf.org/en/about/factsheets/sheets/2023/imf-world-bank-debt-sustainability-framework-for-low-income-countries) - [Press Releases](https://www.imf.org/en/news/searchnews) - [Press Release No.19/258](https://www.imf.org/en/News/Articles/2019/06/29/pr19258-rwanda-imf-executive-board-concludes-2019-article-iv-consultation-request-three-year-pci) - [https://www.imf.org/en/home](https://www.imf.org/en/home) _Source: https://www.imf.org/en/news/articles/2022/12/12/pr22426-imf-executive-board-approves-319-million-arrangement-for-rwanda_