Rwanda's fight against coronavirus has been boosted with $109
million credit from the International Monetary Fund (IMF), which is
expected to help in softening the economic impact of the pandemic.
The funds will “serve to meet Rwanda’s urgent balance of payment needs stemming from the outbreak of the Covid-19 pandemic.”
“The
IMF emergency support under the Rapid Credit Facility will help with
Covid19-related pressures on trade, tourism and foreign exchange
reserves, and will provide much-needed resources for health expenditure
and for households and firms affected by the crisis. It should also help
to catalyse donor support," said Tao Zhang, IMF Deputy Managing
Director.
The global lender said that while the
Covid-19 pandemic is quickly unfolding, with the near-term outlook
deteriorating quickly, Rwandan authorities had acted fast by putting in
place measures to help contain and mitigate the spread of the disease.
“A
temporary widening of the budget deficit is appropriate to mitigate the
health and economic impact of the pandemic. Spending should be
well-targeted and cost-effective to not crowd-out other priority areas,”
IMF said.
It also advised that once the crisis abates,
Rwanda should adjust its fiscal policies to preserve debt
sustainability in the medium-term, and contingency plans should be
prepared given the uncertain outlook.
Reacting on the development, Rwanda’s Central Bank Governor,
John Rwangombwa, said Kigali was "grateful for the quick approval of
this support."
"Together we shall overcome this pandemic and mitigate its negative impact," said Mr Rwangombwa.
Last week, Rwanda received $1 million from the American government to fight the virus pandemic.
The
country implemented a countrywide lockdown last month and extended it
by a further two weeks till mid-April in the face of rising coronavirus
cases.
The lockdown has all but stagnated the economy
by freezing major economic activities, grounding both air and road
transport and closed the borders, as well as putting a halt on
conference tourism, which the government has prioritised as its major
cash cow.
The situation created an urgent balance of
payments need, and the uncertainties surrounding the duration and spread
of the pandemic, the economic fallout could intensify further, IMF
warns.
Rwanda has as at Thursday recorded 82 cases of coronavirus.
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