How Rwanda’s growth since 1994 measures against other economies and what explains the figures
Rwanda seems to be a country of extremes. Its turnaround since the
genocide has been as astounding as the tragedy itself. The scale and
speed of the Rwanda genocide was unprecedented. Rwanda’s rapid state and
economic reconstruction has been equally unprecedented. One measure for
success of a country is the growth of the Gross Domestic Product (GDP).
Because this is based on statistical evidence rather than on opinion,
it is a more preferred way to assess the performance of any government.
For example, statistical evidence shows that very few countries in
the history of humankind have sustained economic growth rates above 7%
on average for 25 years. These include South Korea, China, Japan,
Malaysia, Taiwan, Singapore, Mauritius and Botswana. Many countries have
had short sprints at growth but have not been able to sustain it over a
One way to measure the success of post genocide Rwanda is to look at
the growth of GDP. I went to the IMF website and downloaded GDP growth
figures of 191 countries and sought to see how Rwanda ranks over the
last 25 years (since 1988), over the last 19 years (since 1994) and over
the last 13 years (since Paul Kagame became president in 2000). The
figures for 2014 are not yet available as we are only half way through
Over the last 25 years, Rwanda’s GDP growth rate has averaged 4.5%
thus making it the 75th fastest growing economy in the world. This
sample is affected by the last six years of the Juvénal Habyarimana
government and three months of the genocide that destroyed 60% of that
nation’s GDP. But if the years are reduced to 19 (to account for the
time since RPF took power), average growth has been 6.6% making it the
23rd fastest growing economy in the world. However, when this figure is
reduced to 13 years to account for the time Kagame has been president,
its average growth rate has been 7.7% and ranks as the 15th fastest
growing economy in the world.
Since 2,000 world prices of oil have been at exceptionally high
levels. This has brought revenue windfalls to oil producing and
exporting countries thus boosting their growth even without hard work.
It is no surprise therefore that out of the 15 fastest growing economies
of the last 13 years, seven have been oil producers and exporters.
China is the 5th largest producer of oil in the world but the 29th
largest oil exporter. However, most of its growth is driven by export of
manufactured products. Therefore, although China has been the 7th
fastest growing economy in the world over the last 13 years, I have not
included it in the sample of oil exporters. Therefore, without oil
exporters distorting the sample, Rwanda has been the 8th fastest growing
economy in the world since Kagame assumed office in 2000. I must admit
that Rwanda is not an African exception. Indeed, our continent has been
the fastest growing region of the world over the last 13 years. Out of
the top 15 fastest growing economies in the world, Africa has six
countries. If the time is reduced to the last ten years, Africa has six
out of the ten fastest growing economies in the world. Therefore, we
need to test Rwanda against Africa’s growth story.
For the last 13 years, Rwanda has been the sixth fastest growing
economy on the continent. However, if you remove oil exporters from the
sample (Angola, Equatorial Guinea, Nigeria, plus Sierra Leone which
exports diamonds), Rwanda has been Africa’s second fastest growing
economy behind Ethiopia.
Rwanda’s growth story is much bigger than this if one accounts for
its many disadvantages. It lacks the natural advantages that can make a
country grow faster economically.
First, neighbourhood: Countries like South Korea, Taiwan and
Singapore on the Pacific Rim enjoyed close geographical proximity to
Japan which had industrialised earlier and was enjoying a Post-World War
Two reconstruction boom. Supplying Japan’s hungry industries with raw
materials, labour and cheap manufactured goods - like industrial parts,
became their speciality. Rwanda, on the other hand, lives in a bad and
dangerous neighbourhood – bordering the Democratic Republic of Congo to
the West and Burundi to the south – both of which countries have been
mired in civil war for most of post genocide Rwanda’s history.
The second factor is proximity to the sea. Rwanda is 1500kms from the
sea and this journey is traversed over treacherous and narrow roads in
Kenya (until recently Mombasa-Nairobi-Busia road was bad) and Uganda
(till now Katuna-Mbarara road is under reconstruction).
The third factor is Rwanda’s lack of rich minerals or rich soils; its
hilly landscape makes agriculture an expensive enterprise as rains wash
away the soils.
Four: where countries in East Asia enjoyed the advantage of a
pre-existing high level of skills and education, the RPF inherited a
country with two lawyers, 30 doctors and hardly any engineers at all –
leave alone people with skills and experience to manage a modern
And five: Rwanda did not have a strategic advantage to attract a big
power to bankroll its reconstruction. Therefore, over the last twenty
years, Rwanda has succeeded in spite of numerous obstacles that would
under normal circumstances have relegated it to slow, stagnant, or
declining economic growth. Rwanda has achieved this rapid growth
because of the quality of its institutions and public policies and the
hard work of its leaders and citizens. This has only been possible
because of the political arrangements that have underpinned post
Most Western “experts” on Rwanda claim that Kagame has presided over a
police state, suffocating individual freedoms, and terrorising its
citizens. It is difficult to make people work hard through coercion. So
consent is fundamental to growth. Rwanda’s stability and success has
come from decisions that have fostered social reconciliation and
political inclusion in the governance.
Rwandans know all too well their ugly history and the political and
social accommodations necessary for them to live in a stable political
order. There are political restrictions in Rwanda that may seem
authoritarian to a foreign visitor armed with an abstract notion of
freedom but which its people, knowing all too well their own
circumstances, see and accept as absolutely necessary for their
stability and cohesion. That is possibly why, when asked how free they
feel, Rwandans in a July 04 Gallup poll ranked higher in feeling free
than citizens of the United States, the world’s oldest democracy.
Sunday, July 13, 2014
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