Donor diplomacy

Donors heaped praise on Finance Minister Donald Kaberuka's Poverty Reduction Strategy Paper launched in Kigali late last month. Nevertheless, they balked at the US$250 million price tag which Kaberuka attached to the programme. The International Monetary Fund, about to open negotiations with Kigali for a new three-year Poverty Reduction and Growth Facility, worries about a widening of the budget deficit in 2002. Under the previous agreement, the deficit was meant to go down; Kaberuka insists that high spending is exceptional and unavoidable. The negotiations promise to be difficult. Yet Rwanda's macro-economic performance is strong enough ­ gross domestic product has grown by about 6 per cent this year ­ to ensure a deal next year.

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Vol 43 Number 8 - 19 April 2002