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© 2004 International Monetary Fund
August 2004
IMF Country Report No. 04/270
Rwanda: Second and Third Reviews Under the Three-Year Arrangement Under the Poverty Reduction and Growth Facility, Request for Waiver of Performance Criteria, and Request for Additional Interim Assistance Under the Enhanced HIPC Initiative—Staff Report; Staff Statements; Press Release on the Executive Board Discussion; and Statement by the Executive Director for Rwanda
In the context of the second and third reviews under the three-year arrangement under the Poverty Reduction and Growth Facility, request for waiver of performance criteria, and request for additional interim assistance under the enhanced HIPC Initiative with Rwanda, the following documents have been released and are included in this package:
the staff report for the second and third reviews under the three-year arrangement under the Poverty Reduction and Growth Facility, request for waiver of performance criteria, and for additional interim assistance under the enhanced HIPC Initiative, prepared by a staff team of the IMF, following discussions that ended on February 23, 2004, with the officials of Rwanda on economic developments and policies. Based on information available at the time of these discussions, the staff report was completed on May 24, 2004. The views expressed in the staff report are those of the staff team and do not necessarily reflect the views of the Executive Board of the IMF.
staff statements of June 8, 2004 updating information on recent developments.
a Press Release summarizing the views of the Executive Board as expressed during its June 9, 2004 discussion of the staff report that completed the requests and reviews.
a statement by the Executive Director for Rwanda.
The documents listed below have been or will be separately released.
Joint Staff Assessment of the Poverty Reduction Strategy Paper Progress Report
Letter of Intent sent to the IMF by the authorities of Rwanda*
Memorandum of Economic and Financial Policies by the authorities of Rwanda*
Poverty Reduction Strategy Paper Progress Report
Technical Memorandum of Understanding*
*May also be included in Staff Report
The policy of publication of staff reports and other documents allows for the deletion of market-sensitive information.
To assist the IMF in evaluating the publication policy, reader comments are invited and may be sent by e-mail to publicationpolicy@imf.org.
Copies of this report are available to the public from
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Front Matter Page
INTERNATIONAL MONETARY FUND
RWANDA
Second and Third Reviews Under the Three-Year Arrangement Under the Poverty Reduction and Growth Facility, Request for Waiver of Performance Criteria, and Request for Additional Interim Assistance Under the Enhanced HIPC Initiative
Prepared by the African Department
(In collaboration with other departments)
Approved by Juan Carlos Di Tata and Mark Plant
May 24, 2004
A three-year Poverty Reduction and Growth Facility (PRGF) arrangement for SDR 4 million was approved on August 12, 2002. The first tranche of SDR 574,000 was disbursed upon approval, and a further SDR 571,000 was disbursed following the completion of the first review, on June 13, 2003. Upon the completion of the second and third reviews, Rwanda will be eligible to draw an amount equivalent to SDR 1.14 million (1.4 percent of quota). As set out in Appendix I, Attachment I, the forthcoming fourth review is proposed to be linked to the performance criteria for end-June 2004.
Discussions for the second and third reviews under the PRGF took place in Kigali during November 12–29, 2003 and February 2–11, 2004, and were followed by discussions at headquarters during February 19–23, 2004. The staff teams headed by Mr. Meyers consisted of Messrs. Christensen, Blavy (both AFR), and Rother (EP-PDR) for the November 2003 mission, and Messrs. Hauner (EP-AFR), and Rother (EP-PDR) for the February 2004 mission. Mr. Farah, the Resident Representative in Kigali assisted the missions. Mr. Rutayisire (Alternative Executive Director for Rwanda) participated in the November 2003 mission.
On June 13, 2003, the Executive Board completed the first review of the three-year arrangement under the PRGF. Executive Directors commended Rwanda’s strong commitment to macroeconomic stability. They stressed the crucial role of economic diversification in reducing external vulnerability, and attached a high priority to implementing the policies set out in the Poverty Reduction Strategy Paper (PRSP) for achieving external sustainability (BUFF 03/92).
Rwanda could reach the completion point under the Enhanced Initiative for Heavily Indebted Poor Countries (HIPC Initiative) at end-2004, following completion of the fourth review under the PRGF arrangement. Since the country reached the decision point in December 2000, it has been benefiting from debt relief from its multilateral and bilateral creditors. Paris Club creditors have been requested to extend the deadline for reaching bilateral agreements to June 30, 2004. Rwanda is also continuing efforts to reach rescheduling agreements with all remaining non-Paris Club creditors. The IMF did not provide HIPC Initiative Interim assistance in 2003. Interim assistance under the HIPC Initiative is being requested for the period June 9, 2004 to June 8, 2005.
Contents
I. Introduction
II. Recent Developments and Program Performance
III. Policy Discussions and Revised Program for 2004
A. Poverty Reduction Strategy and Growth
B. Fiscal Policy
C. Monetary Policy
D. External Sector Policies
E. Structural Reforms
F. Governance and Safeguards
G. Statistical Issues
H. Program Monitoring
IV. Staff Appraisal
Boxes
1. Debt Sustainability
2. Structural Conditionality
Figures
1. Real GDP Growth, 1996–2006
2. Real and Nominal Exchange Rates, January 1999–December 2003
3. Price Developments, January 2000–February 2004
4. Broad Money and Reserve Money December 2000–December 2003
Tables
1. Selected Economic and Financial Indicators, 2001-06
2. Operations of the Central Government, 2001-06
3. Monetary Survey, 2001-04
4. Balance of Payments, 2001-06
5. External Financing Requirement and Sources, 2001-06
6. External Public Debt and Debt Service, 2001-06
Appendices
I. Letter of Intent
Attachment I: Memorandum of Economic and Financial Policies of the Government of Rwanda for 2003
Attachment II: Technical Memorandum of Understanding Between the Government of Rwanda and the International Monetary Fund
II. Relations with the Fund
III. IMF-Bank Relations Annex
IV. Statistical Issues
V. Work Program—Proposed Phasing of Disbursements Under the PRGF Arrangement, 2002–05
VI. Safeguards Assessment—Summary of Conclusions
VII. Millennium Development Goals
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June 9, 2004
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June 9, 2004
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Press Release No. 04/114
FOR IMMEDIATE RELEASE
June 10, 2004
International Monetary Fund
Washington, D.C. 20431 USA
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June 9, 2004
