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Rwanda’s Economic Success Story

After the 1994 Rwandan genocide against the Tutsi that killed 800,000 people, Rwanda has developed as a nation, improving its economy and decreasing its poverty rates. Rwanda Vision 2020 seeks to bolster Rwanda’s economic success by investing in a knowledge-based society.

World Economic Forum calls Rwanda “one of the fastest growing economies in Central Africa.” The country increased its GDP growth to eight percent per year between 2001 and 2014. However, more than 60 percent of the population still lives on less than $1.25 a day.

Foreign assistance continues to expand Rwanda’s economy by investing in programs such as education, youth workforce development and the coffee sector. Rwanda benefited from foreign assistance since the genocide, with 30 to 40 percent of the nation’s budget coming from aid. The Rwandan government’s initiative, Rwanda Vision 2020, focuses on long-term goals to grow from an agricultural and subsistence economy to a diversified economy less dependent on foreign aid.

Struck by economic disadvantages, including high unemployment and fluctuating prices in coffee and tea exports, Rwanda hopes to transform into a middle-income country and knowledge-based society.

Rwanda Vision 2020 promotes macroeconomic stability and wealth creation to reduce dependency on aid and develop the private sector. The initiative will expand Rwanda’s domestic resource base and increase its exports and promote diversification in non-traditional exports.

Rwanda recognizes that it must improve education and health standards to provide an efficient and productive workforce. Entrepreneurship is crucial to Rwanda’s economic success. Instigating wealth, employment and educational services in sciences and technology will create a new class of entrepreneurs.

USAID partners with the Rwanda Education Board to enhance investments in training, teaching and materials to ensure that all children learn to read within their first years of schooling.

While Rwandan youth are challenged by poverty and social instability, they increase their chances for success through USAID’s programs for basic life skills and work training, which promote education and employment. As a result, over 20,000 youth are equipped with workforce skills, and over 60 percent of these youth gained new or better employment, including self-employment. More than 40 percent of the youth choose to pursue further schooling.

With a history of poverty, Rwanda’s economic success comes from embracing present challenges and adjusting its approach. Rwanda’s changing landscape promotes socio-economic stability and harnesses a new identity as it becomes a middle-income nation and knowledge-based society.

Sarah Dunlap

Photo: Flickr