WELCOME TO RWANDA
Small and landlocked Rwanda is hilly and fertile with a densely packed population of about 12.5 million people (2018). It borders the far larger and richer Democratic Republic of Congo as well as its closest East African neighbours, Tanzania, Uganda, and Burundi.
With the support of the International Monetary Fund (IMF) and the World Bank, Rwanda has been able to make important economic and structural reforms and sustain its economic growth rates over the last decade.
Rwanda has guarded its political stability since the 1994 genocide. Parliamentary elections in September 2018 saw women fill 64% of the seats; the Rwandan Patriotic Front maintain an absolute majority in the Chamber of Deputies and, for the first time; two opposition parties: the Democratic Green Party of Rwanda and Social Party Imberakuri has been winning two seats each in the parliament. President Paul Kagame was re-elected to a seven-year term in the August 2018, following an amendment to the constitution in December 2015 allowing him to serve a third term.
Public investments have been the main driver of growth in recent years. External financing through grants, concessional and non-concessional borrowing played an important role in financing of public investments. Growth slowdown of 2016 and 2017 highlighted the limits of public sector-led growth model. Going forward, the private sector will play a bigger role in helping to ensure economic growth. Low domestic savings, skills, and the high cost of energy are some of the major constraints to private investment. Stronger dynamism in the private sector will help to sustain high investment rate and accelerate the growth. Promoting domestic savings is viewed as critical.
Rwanda’s strong economic growth was accompanied by substantial improvements in living standards, with a two-thirds drop in child mortality and near-universal primary school enrolment. A strong focus on home-grown policies and initiatives has contributed to significant improvement in access to services and human development indicators. Measured by the national poverty line, poverty declined from 59 to 39% between 2001 and 2014 but was almost stagnant between 2014 and 2017. The official inequality measure, the Gini index, declined from 0.52 in 2006 to 0.43 in 2017.
Rwanda now aspires to reach Middle Income Country (MIC) status by 2035 and High-Income Country (HIC) status by2050.This aspiration will be carried out through a series of seven-year National Strategies for Transformation (NST1), underpinned by detailed sectorial strategies that are aimed toward achievement of the Sustainable Development Goals.
The NST1 came after the implementation of two, five-year Economic Development and Poverty Reduction Strategies—EDPRS (2008-12) and EDPRS-2 (2013-18), under which Rwanda experienced robust economic and social performances. Growth averaged 7.5% over the decade to 2018, while per capita growth domestic product (GDP) grew at 5% annually.
Employment and Unemployment
Rwanda Labour Force Survey (LFS) started in 2016 with an annual sample spread into two rounds to provide bi-annual estimates of main labour market indicators at National level. From February 2019, the sample was spread into four rounds to provide estimates of labour market indicators at national level on quarterly basis with an objective to provide data on the structure and trends of labour force, employment and unemployment as well as other related labour market statistics for the implementation and evaluation of economic and social policies related to employment creation, income generation, skills development, and related decent work policies. It collects data on the labour market activities of individuals aged 14 years and above who live in ordinary household. However, this article only covers labour market activities of persons aged 16 years and above.
In August 2019 (Q3), the working age population (16 years and above) was around 7.2 million and the population in the labour force constituted the majority of working age population. The proportion of population in labour force has slightly decreased compared to the previous quarter of the survey. In August 2019 (Q3), the youth (16-30 years old) constituted 44.2 percent of the population in the labour force and this proportion has slightly increased as compared to the previous Quarter of the survey May 2019 (Q2)
From 2016 to 2018,the unemployment rate in Rwanda has been declining while the employment to population and Labour force participation Rate is increasing. Unemployment has decreased by 0.7 percentage points from 16.7 in February 2017 to 16.0 percent in February 2019. Again it has decline by 1.8 percentage points between August 2017 and August 2019.
However, during this year, Unemployment rate has shown an increasing trend. Quarter to Quarter comparison shows an increasing trend of unemployment rate from 14.5 percent in February 2019_Q1 to 15.5 and rose again to 16.0 percent in August 2019_Q3. The employment to population ratio which is the proportion of Labour force (Either employed or unemployed) to the working age population, increased from 44.9 percent in February 2019_Q1 to 45.7 percent in May 2019_Q2 and slightly declined to 43.9 percent in August 2019_Q3. Labour force participation rate follow the same patterns as Employment to population which may be due to the change in age structure or other socio economic effects.