Rwanda: Exports grew by 58.8 percent in third quarter

Rwanda's exports grew by 58.8 percent in the third quarter of 2021 driven by factors including rising commodity prices, good…

Rwanda’s exports grew by 58.8 percent in the third quarter of 2021 driven by factors including rising commodity prices, good performance of domestic manufacturing activities as well as blossoming horticulture, an official report indicated Sunday.During the quarterly Monetary Policy Committee meeting of the Central Bank whose mission is to assess economic trends and ideal approaches to maintain economic stability, it was noted that in the third quarter, exports grew by 58.8 percent compared to the same period last year with growth in traditional exports by 43.1 percent (coffee, tea, minerals) and 47.5% growth in non-traditional exports (manufactured products and horticulture).

Imports into Rwanda grew by 12.7 percent which was largely driven by increased cost of oil prices by about 75 percent. 

 Imports of intermediate goods used in manufacturing grew by 7 percent.

Crude oil prices have been rising steeply globally to surpass pre-covid-19 levels by about 69.5 percent and are expected to exert pressure on Rwanda’s inflation which is currently quite low at 0.6 percent from about 0.7 percent recorded in the second quarter of 2021.

Thierry Kalisa, the Chief Economist at the Central Bank noted that fuel prices are further expected to rise in the coming months but said with the current low base of inflation, it is projected to end the year at 0.7 percent and 5.4 percent in 2022.

“We know it is going to increase and can expect that it will increase up to about the second  half of next year. Inflation is currently low, this will put pressure on our import component, it will influence inflation in 2022, that is how it gets to 5.4 percent in 2022,” he said.

With fuel prices increasing globally to surpass pre-covid-19 levels, the government in October adjusted its fuel subsidy intervention to cushion Rwandan consumers against increased cost of living.

With that, diesel prices remained unchanged at Rwf 1054 per litre while those for petrol rose to Rwf 1143 per litre from Rwf1,088.

Soraya Hakuziyaremye, the Deputy Governor of the Central Bank noted that subsidies had played a huge role in keeping inflation low to allow economic recovery.