Economic and Political Overview

flag Rwanda Rwanda: Economic and Political Overview

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

 

Economic Indicators

From 2014 to 2023, Rwanda's GDP per capita grew at an average rate of 4.3% per year. However, this growth has been largely driven by public investment, supported by external aid, which has not led to sufficient job creation or significant improvements in productivity and poverty reduction. The economy grew by 8.9% in 2024, up from an average of 8.2% in 2022-2023, driven by strong private consumption—fueled by the creation of nearly half a million jobs, particularly in rural areas—and solid investment. On the supply side, growth was led by continued expansion in services (+10%), industry, and a recovery in food production. Furthermore, private consumption grew by 4.2% in 2024, driven by improved labour market conditions and lower inflation. Public consumption rose by 14.8%, while investment surged by 16.0%, up from a slight decline of -0.2% in 2023, mainly due to strong construction activity. Looking ahead, real GDP is expected to grow at an average of 7.1% from 2025 to 2027, fueled by continued growth in agriculture, services, and industry (data from the World Bank).

Rwanda’s fiscal position improved in the first half of FY2024/25, driven by higher tax collections and fiscal consolidation efforts. Revenue reached 21.9% of GDP, up 1.5 percentage points from the previous year, largely due to the increased use of Electronic Billing Machines (EBM). On the expenditure side, total outlays were 26.7% of GDP, in line with the budget, reflecting efforts to streamline spending. Consequently, the fiscal deficit narrowed to 4.8% of GDP, with the primary balance deficit reducing to 2.8% of GDP. The government is focused on fiscal consolidation, cutting costs through reduced official travel, virtual meetings, and expanding public services digitalization. It is also improving public investment management and revenue administration to broaden the tax base. Public debt, estimated at 78.8% of GDP in 2024 by the World Bank, is projected to peak at 86.4% in 2026 before gradually declining. Meanwhile, inflation eased to 4.8% in 2024, down from over 13% in the previous two years, driven by lower food prices, easing global inflation, and monetary tightening. However, core inflation remained high due to rising transport costs after the removal of government subsidies. The banking sector stayed stable, with private sector credit growing by 20.3%, non-performing loans at 5%, and banks maintaining strong liquidity and capitalization, as seen in a liquidity coverage ratio of 305.9% and a capital adequacy ratio of 22.8%, well above regulatory thresholds.

According to the World Bank, Rwanda's labour market improved in 2024, with unemployment falling to 14.9% and labour force participation rising to 62.3%, although gender and urban-rural disparities remain. Using the international poverty line of USD 2.15/day in 2017 PPPs, poverty in Rwanda was estimated at 47.6% in 2024. Rwanda has a low GDP per capita, estimated at USD 3,814 in 2024 by the IMF (PPP).

 
Main Indicators 2023 (E)2024 (E)2025 (E)2026 (E)2027 (E)
GDP (billions USD) 14.1013.6614.0214.9316.15
GDP (Constant Prices, Annual % Change) 8.27.06.56.87.2
GDP per Capita (USD) 1,0449869901,0321,093
General Government Gross Debt (in % of GDP) 64.571.473.373.471.8
Inflation Rate (%) 14.04.95.15.05.0
Current Account (billions USD) -1.65-1.64-1.54-1.44-1.48
Current Account (in % of GDP) -11.7-12.0-11.0-9.7-9.2

Source: IMF – World Economic Outlook Database , Latest available data

Note: (e) Estimated Data

Main Sectors of Industry

The Rwandan economy relies on a subsistence economy, exports of tea and coffee, and tourism. The mining sector is also a significant contributor to the economy, with the country being one of the largest producers of tantalum, a crucial material used in mobile phone construction. Agriculture serves as Rwanda's primary economic activity, directly employing 54.8% of the total population (World Bank). This sector constitutes 27.1% of GDP and contributes roughly 80% of foreign income from exports such as coffee, tea, hides and skins, horticulture, and pyrethrum (a chrysanthemum-based insecticide). Approximately 61% of Rwanda's land is suitable for agriculture due to its fertile soils. However, food production often falls short of demand, necessitating imports. According to the National Institute of Statistics Rwanda, in 2024, food crop production in agriculture rose by 5% thanks to good harvests. However, export crop output fell by 1%, as modest increases of 2% in coffee and 1% in tea were outweighed by an 8% drop in other cash crops such as pyrethrum and sugarcane.

The industrial sector in Rwanda is closely tied to the processing of primary agricultural products and represents 21.5% of GDP and 14.5% of employment. Nearly 70% of industries are concentrated in Kigali, with minimal activity in urban centres in the hinterland. The government is committed to gradually privatizing the productive sector and fostering the development of the private sector. Rwanda's manufacturing industry is modest yet expanding, witnessing a transition from basic production to more value-added activities across various sub-sectors. These include fast-moving consumer goods like detergents, body care products, and plastics, as well as construction materials such as cement and steel bars. Additionally, there's a growing presence in furniture, laboratory equipment, electronic products, and automotive assembly, including phones, computers, and vehicles. Overall, the World Bank estimates the manufacturing sector to contribute 10% of GDP. In 2024, Rwanda’s industrial sector grew by 10%, driven by strong gains in manufacturing and construction—up 7% and 12% respectively—boosted by growth in metal products, chemicals, textiles, and infrastructure projects. This was partly offset by a 12% decline in mining and quarrying (data NISR).

The tertiary sector accounts for approximately 44.3% of GDP and employs 30.7% of the total workforce. Rwanda's banking sector consists of 15 commercial banks, microfinance banks, development banks, and cooperative banks. The sector posted strong growth in 2024, with total banking assets reaching RWF 7.8 trillion and net profits rising by 36.7% to RWF 132.5 billion in the first half of the year, supported by increased lending and greater operational efficiency (data Rwanda Bankers' Association). Additionally, Rwanda aims to bolster the growth of its tourism industry and position itself as a regional leader in information and communication technologies. Tourism has emerged as a significant source of foreign exchange, driven in part by the rise in international conferences, and is expected to continue growing due to substantial investments in infrastructure (in 2024, it generated USD 647 million in revenue, a 4.3% increase from the previous year). The services sector grew by 10% in 2024, driven by an 18% surge in wholesale and retail trade. Transport expanded by 9%, with air and land transport rising by 18% and 10% respectively. Strong growth was also recorded in information and communication services (25%), hotels and restaurants (11%), public administration (10%), financial services (7%), and education (5% - data NISR).

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 54.8 14.5 30.7
Value Added (in % of GDP) 27.1 21.5 44.3
Value Added (Annual % Change) 1.7 10.2 11.2

Source: World Bank - Latest available data.

 

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Monetary Indicators 20162017201820192020
Rwandan Franc (RWF) - Average Annual Exchange Rate For 1 MUR 22.1724.1225.3825.3423.97

Source: World Bank - Latest available data.

 
 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
68,3/100
World Rank:
47
Regional Rank:
2

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 
 

Country Risk

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Foreign Trade in Figures

Rwanda's economic policy is open to foreign trade which accounts for 66% of the GDP (World Bank, latest data available). In addition to benefiting from the U.S.-Rwanda Bilateral Investment Treaty (BIT), Rwanda is a member of the East African Community (EAC) - one of the most dynamic regional communities in Africa - the Common Markets of Eastern & Southern Africa (COMESA) and the WTO. Custom duties are relatively low in the country and non-tariff barriers are virtually non-existent. Rwanda mainly exports food and live animals (22.8%, mostly tea and coffee), crude materials, inedible, except fuels (13.4%), and manufactured goods classified chiefly by material (6.7%). In contrast, imports are led by machinery and transport equipment (18.7%), food and live animals (17.1%), other commodities & transactions, n.e.s (15.1%), manufactured goods classified chiefly by material (14.3%), mineral fuels, lubricants and related materials (11.0% - data National Institute of Statistics Rwanda, 2023).
 
Rwanda's main export partners in 2023 were the United Arab Emirates (56.8% of total exports), the DRC (10.4%), China (5%), Hong Kong (2.6%), and the U.S. (1.1%). On the other hand, imports came chiefly from China (18.7%), Tanzania (13.6%), India (10.5%), the United Arab Emirates (5.4%), and South Africa (2.7% - data National Institute of Statistics Rwanda).

Due to its strong growth and demand for manufactured goods, Rwanda has a structural trade deficit. In 2023, the country exported USD 2.47 billion worth of goods, while it imported USD 3.89 billion (+17.4% and +9.2% y-o-y, respectively – data WTO). Concerning services, exports stood at USD 1.04 billion against USD 949 million in imports. According to the World Bank, the country’s trade deficit stood at around 15.1% of its GDP in 2023 (from 16.2% one year earlier). Preliminary figures from the National Institute of Statistics show that total export receipts for 2024 amounted to USD 4.2 billion. The UAE remained the largest export market, accounting for 63.9% of total exports.

 
Foreign Trade Indicators 20192020202120222023
Imports of Goods (million USD) 2,6592,5422,8953,5693,897
Exports of Goods (million USD) 1,2411,4081,5312,1112,479
Imports of Services (million USD) 1,033520701878949
Exports of Services (million USD) 1,0155215768811,047
Imports of Goods and Services (Annual % Change) 18.0-3.62.717.914.4
Exports of Goods and Services (Annual % Change) 19.9-9.62.429.425.8
Imports of Goods and Services (in % of GDP) 36.235.935.138.740.6
Exports of Goods and Services (in % of GDP) 21.819.319.522.525.4
Trade Balance (million USD) -1,465-1,650-1,659-1,989-2,369
Trade Balance (Including Service) (million USD) -1,482-1,649-1,746-1,985-2,274
Foreign Trade (in % of GDP) 58.055.254.661.166.0

Source: WTO – World Trade Organisation ; World Bank , Latest Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2022
Democratic Republic of Congo 38.0%
United Arab Emirates 29.2%
China 4.8%
India 3.5%
United Kingdom 2.3%
See More Countries 22.1%
Main Suppliers
(% of Imports)
2022
China 21.0%
Tanzania 11.1%
Kenya 9.3%
India 9.3%
United Arab Emirates 8.2%
See More Countries 41.1%

Source: Comtrade, Latest Available Data

 
 

Main Products

1.0 bn USD of products exported in 2018
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 13.1%
Tea, whether or not flavouredTea, whether or not flavoured 9.0%
Coffee, whether or not roasted or decaffeinated;...Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion 8.2%
Gold, incl. gold plated with platinum, unwrought...Gold, incl. gold plated with platinum, unwrought or not further worked than semi-manufactured or in powder form 7.3%
Precious stones and semi-precious stones, whether...Precious stones and semi-precious stones, whether or not worked or graded, but not strung, mounted or set, ungraded precious stones and semi-precious stones, temporarily strung for convenience of transport (excl. diamonds and imitation precious stones and semi-precious stones) 7.1%
See More Products 55.2%
2.8 bn USD of products imported in 2018
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 18.4%
Telephone sets, incl. telephones for cellular...Telephone sets, incl. telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, incl. apparatus for communication in a wired or wireless network [such as a local or wide area network]; parts thereof (excl. than transmission or reception apparatus of heading 8443, 8525, 8527 or 8528) 4.8%
RiceRice 2.5%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 2.3%
Wheat and meslinWheat and meslin 2.1%
See More Products 69.9%

Source: Comtrade, Latest Available Data

 
 

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Main Services

Source: United Nations Statistics Division, Latest Available Data

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Sources of General Economic Information

Ministries
Official list of ministries
Ministry of Finance and Economic Planning
Ministry of Agriculture and Animal Ressources
Ministry of Foreign Affairs and International Cooperation
Ministry of Trade and Industry
Ministry of Infrastructure
Statistical Office
National Institute of Statistics Rwanda
Central Bank
National Bank of Rwanda
Stock Exchange
RSE - Rwanda Stock Exchange Limited
Search Engines
Google Rwanda
Economic Portals
Fortune of Africa Rwanda
Financial Times Rwanda
The New Times

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Political Outline

Current Political Leaders
President: Paul KAGAME (since April 2000, re-elected in 2017) – RPF
Prime Minister: Edouard NGIRENTE (since 30 August 2017) - PSD
Next Election Dates
Presidential: July 2029
Senate: September 2029
Chamber of Deputies: July 2029
Main Political Parties
Rwanda is a one-party dominant state, with the Rwandan Patriotic Front (RPF) in power. The RPF, a Tutsi nationalist and populist party, overthrew the Hutu-led government in 1994. While opposition parties are allowed, they are generally considered to have limited influence and no real chance of gaining power. Some of the other notable political parties in Rwanda include:

- Social Democratic Party (PDS): Centre-left

- Liberal Party (PL): Centre, liberalism

- Social Party Imberakuri (PSI): Social-democratic

- Democratic Green Party of Rwanda (DGPR): Green-liberal
Type of State
Rwanda is a presidential republic.
Executive Power
The President of Rwanda is the head of state, while the Prime Minister serves as the head of government. Executive power is exercised by the Prime Minister and the Council of Ministers, under the authority of the President. The President is elected by popular vote. Under the 2015 constitutional reform, presidential terms are now five years (after a transitional seven-year term) and are renewable. The President appoints the Prime Minister as well as all other members of the Cabinet.
Legislative Power
Legislative power in Rwanda is vested in Parliament, which is composed of two chambers: the Chamber of Deputies and the Senate. The Chamber of Deputies has 80 members elected every five years. The Senate consists of 26 members who serve eight-year terms (Article 64 of the Rwandan Constitution). Of the 26 senators, 12 are elected by local government entities, 8 are appointed by the President to ensure the representation of historically marginalised groups, 4 are designated by the National Consultative Forum of Political Organisations, and 2 are elected by academic staff from one public and one private university.
 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
156/180
 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Not Free
Political Freedom:
6/7

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House

 

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Latest Update: May 2025