The Minister of Finance and Economic Planning , John Rwangombwa and the World Bank Country Manager for Rwanda, Mimi Ladipo have today signed a US$125 million International eighth Development Association (IDA) Poverty Reduction Financing Agreement.
The Eighth Poverty Reduction Support Financing (PRSF-8) will help the Government’s implementation priorities in its medium term strategy, the Economic Development and Poverty Reduction Strategy.
Given Rwanda’s status as a blend country, US$60 million of the funds are on IDA grant terms and US$65 million are on IDA credit terms.
The PRSF-8 is the first operation in the third series of World Bank Poverty Reduction Support operations for Rwanda launched in 2002.
The new series particularly supports the development of policies that facilitate increased private sector investment and involvement and ease constraints to broad based growth.
“In order for Rwanda to sustainably increase its revenue base, it is important for the Government to continue to focus on developing a Foreign Direct Investment and to agree on a comprehensive private sector development strategy”.
“In particular we encourage Rwanda to act decisively to remove any remaining constraints, including as relates to infrastructure, anti-competitive policies and practices, and taxation, to inward investment and to the development of the private sector,” Said Mimi Ladipo.
During the PRSF8-10 priority areas of support will be policy measures aimed at: (i) supporting the facilitation of trade and investments; (ii) increasing access to electricity and improved infrastructure services; (iii) raising private sector participation in the agricultural sector;
Others include (iv) increasing the quality and relevance of education to build a skilled workforce; (v) improving service delivery through focused and strategic civil service reform; and (vi) strengthening the management of public resources, including increasing transparency and accountability.
The PRSF-8 financing is dependent on progress against EDPRS objectives as measured by the Common Performance Assessment Framework relied upon by all budget support partners in Rwanda.
The most recent XIV Joint Budget Support Review, held on October 24-25, 2011, showed that Rwanda is making good progress in terms of implementing the targets and policy actions within the harmonized framework of budget support.
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