EDPRS 2 Towards Achieving Self Reliance National Dialogue Council December, 13-14th 2012

GDP/capita doubled in 5 years As I said that I will use a few indicators that show progress towards economic development and especially economic self reliance: the first one of those is the GDP per capita. Over the last 10 years, Rwanda has tripled its GDP per capita from USD 200 to about USD 600. If we consider only the EDPRS 1 period, GDP per capita has doubled over the last 5 years from around USD 300 to USD 600. This was achieved thanks to an average overall GDP growth of above 8% annually. => mu myaka itanu ishize, umusaruro ku munyarwanda wikubye kabiri (kuva kuri USD 300 kugera kuri USD 600)

To be a Middle Income Country by 2020 GDP growth $600 2011 2020 11% $1200 In our ambition to become a middle income country by year 2020, we need to double GDP per capita. This imply achieving a growth of real GDP of 11% to achieve more USD 1200 from the current USD595. It also means that on average, every Rwandan needs to be producing, in 2020, the double of what he is producing today. It also calls for doubling of the ratio of private investment to GDP from around 10% to 20%. => umusaruro ku munyarwanda ugomba kwikuba kabiri kuva kuri USD 600 kugera kuri USD 1200 mu mwaka ya 2020. Ibyo bisaba ko buri mwaka umusaruro wa buri wese wihongera nibura 10% buri mwaka.

Trade values tripled in 5 years External Trade figures allow to see how we interact with the rest of the world. They also the strength of our external sector and the degree of exposure to external shocks. Exports that were at around USD 150 million in 2006, over the last five years have tripled to reach USD 460 million. Over the same period, imports have also more than tripled from USD 450 million in 2006 to USD 1560 million.

Need more Forex earnings $5000 Mios Exports growth 28% $500 Mios Our economy needs increased inflows of foreign exchange – among others as a means to finance its growth. Our objective is to achieve 28% growth of exports on average over the next decade (in 2020, exports will be 10 times higher than in 2011); while also improving the competitiveness of locally produced goods as compared to imports (kwongera ibyo twohereza hanze n’ibyo to gurisha imbere mu gihugu – ku buryo tugabanya ibyo tugura hanze kandi tushobora kwikorera) => Tukeneye gukuba inshuro icumi ibyo twohereza hanze kuva kuri USD 500 million kugera kuri USD 5000 million 2011 2020

Millions out f poverty I also want to talk about progress and ambitions in terms of living conditions as measured by the proportion of people living in poverty: Over the years, millions of Rwandans have graduated from poverty (more than 3 million people since 1995). Only over the 5 years from 2005/06 to 2010/11 (under EDPRS1), we reduced poverty by 12 percentage points corresponding to more than a million Rwandans getting out of poverty. Less talked about but of significant importance is the fact that extreme poverty (ubukene nyakurya) was at the same time (last five years) reduced from 37% to 24%. Our goal is one of reducing poverty further from about 45% today to less than 30% over the next five years, while our ambition in Vision 2020 is also one of increasing the proportion of people who are self reliant by eradicating extreme poverty and vulnerability (gusezera burundu ubukene nyakurya). Note that we call extreme poverty the fact of having an income below the food poverty line = ubukene nyakurya = abatashobora kwihaza

EDPRS 2 Guiding Principles Innovation for productivity 1 Innovation for productivity Need to focus on new interventions as well as new ways of thinking and delivering Inclusiveness and Engagement 2 Ownership at all levels 3 Ensure that programs and targets achieved from EDPRS 2 are long lasting Sustainability

Census 2002 – 2012 Population Allow me to talk briefly of the recent data from the latest census: those show that over the last decade, Rwanda population has been growing at a rate of 2.6% (from 8.2 million inhabitants in 2002 to 10.5 million) in 2012. These results further strengthen the point that when Rwandans buy into Government policies, those deliver the results expected. These are also good news in the sense that if the trend continues, achieving higher GDP per capita will be happen faster The main point from the census, and maybe the most important of all those made up to now, is that at 10.5 million of Rwandans, our population is our main asset. We need to develop our people and all become more productive if we are to achieve our ambitions. We need to ensure that all participate to the development of the country, that each one makes his contribution in shaping our destiny. the EDPRS 2 is about that, making us all more productive by participating and contributing to the development of Rwanda.

All four thematic areas under EDPRS 2 aim at achieving our Vision 2020 Economic Transformation 11.5% Real GDP growth Rural Development Less than 30% of poor Improved Productivity & Youth Employment 200,000 jobs p/annum Accountable Governance 28% Export Growth Private Investment at 20% of GDP 30% Urbanisation 70% planned grouped settlements 8.5% Agric Growth SMEs for jobs education TVET for skills Participation in development Delivery of quality service All 4 thematic areas under the EDPRS 2 aim at achieving our Vision 2020 of becoming a middle income country with better living conditions for all in Rwanda. I will discuss two of them as there is a specific session to discuss youth employment. Ndavuga cyane cyane kubikenewe mu rwego rwo kugera kuri (1) iterambere ry’ubukungu – izamuka n’ihinduka ry’imiterere ry’ubukungu (2) n’iterambere y’icyaro.

To become a middle-income country by 2020, we need to double GDP 11% Growth Rate p/annum $ 1000USD $595USD Exports 20% of GDP Private Investment 10% of GDP GDP 28% Growth 2011 2020

Four priorities have been identified under Economic Transformation to drive rapid growth and exports Diversifying the economy Rapid Growth of Exports Productivity and Competitiveness Urbanisation for Growth

1. Improved Business orientation and thinking Profit Everyone is expected to play a role in achieving economic transformation 1. Improved Business orientation and thinking Profit Thinking market satisfaction (with improved market information) Increased business innovation (profitable competition/ new unsaturated markets => increased diversification) Business association Cities as pillars of growth Good for rural development and employment 2. Urbanisation Priorities identified under the economic transformation thematic area include: Diversifying the economic base through the development of new industries and services with focus on exports orientation – this will also ensure rapid growth of exports. Our objective is also to develop the country into a hub for services (financial, IT and logistics and transport) building the current comparative advantage from previous investment in IT and location at center of eastern and central Africa as well as bilinguism. Increase the productivity and competitiveness of the private sector, including by Focusing on larger size of firms (not only attracting medium to large firms for investment in specific sectors, but also encouraging private business to come together into business association – cooperatives, joint ventures, etc.) that have proven to be more productive and offering full package solutions for business (infrastructure, skills, finance) Using urbanisation as a driver of growth by planning for it around the economic potential of cities

Our goal under rural development is to reduce poverty from 45% to less than 30% over the next five years

There are four priorities under rural development to reduce poverty fast ensure sustainability Sustainable Rural Settlements Integrated land use planning and quality of rural housing Increased productivity of agriculture through: Proximity extension services, Irrigation, Land Husbandry Private investment in agriculture On-farm productivity Social Protection linked to Development Improved targeting and coverage of schemes Enabling graduation from Social Protection to self reliance Connecting to Markets Feeder roads and access to new finance mechanisms

Improved productivity and youth employment 200,000 jobs per annum Rural Development Improved productivity and youth employment 200,000 jobs per annum Accountable Governance Important part of EDPRS 2 - discussed under other sessions As mentioned before, I want to note two other thematic areas under EDPRS 2. These are very important for of our development outcomes in terms of translating our economic transformation and rural development into income for individuals (by increasing individual productivity through training – skills development and creating jobs) and contribution of all to the progress that we want to achieve (through participation to development delivery and quality of service rendered in all areas). I decided not to dwell on them as they are part of presentations that are being discussed during other sessions.

Everyone has a role to play in supporting rural development Living in well planned imidugudu Access to basic infrastructure Proximity to production place Developing contractual mindset – respect the terms of the contract; repay loans and credit Increased uptake of micro-insurance Increase individual productivity amongst farmers Agriculture becoming more profitable and less risky Private sector orientation in agriculture Self reliance mindset Not over-relying on solidarity