National Budget 2020/21: Where Will Rwanda Spend The Money?

Irrigation dam in Rulindo-Northern Province

The Minister of Finance and Economic Planning Dr Uzziel Ndagijimana presented the budget for the fiscal year 2020/21 on Tuesday, revealing that the government will spend Rwf3,245.7 billion -an increase of Rwf228.6 billion compared to Rwf3,017.1 billion which the government spent in the 2019/20 revised budget.

 Key highlights of the budget show that the government will extensively spend on activities to give the economy a kickstart after the New Coronavirus outbreak led to the economy nearly grinding to a halt due to measures which were put in place to contain the spread.

 The government has planned to spend on key sectors of the economy in the medium term in a bid to accelerate economic growth for all, with the main focus being strengthening the private sector, building a knowledge-based economy and leveraging the country’s natural resources for development. 

Where will the money go?

 The government has budgeted Rwf1,802.8 billion, which is 55.5% of the total budget for 2020/21, to go towards economic transformation.

 Rwf16.2 billion will be spent on Job creation and entrepreneurship development, with the government targeting to create some 205,500 jobs through the National Employment Program (NEP).

 Worth mentioning is that the government will provide basic materials to about 7,560 undergraduate students (TVETs) to help them create jobs and at the same time state-of-the-art equipment to artisans in order to increase the value of their work

 In the Private Sector, the government will support up to 550 small, medium and small enterprises to access financial advisory services while private companies affected by the COVID-19 epidemic will be supported through the Economic Recovery Fund.

The government announced an economic recovery fund of up to Rwf100 billion that will be given to affected businesses especially in the service and hospitality sector which were hard hit by COVID-19. 

Infrastructure

 The government will spend Rwf122.7 billion on key infrastructure projects to boost electrification, including the continuation of construction of the Mamba-Rwabusoro-Rilima power line from Hakan Peat Power Plant.

Peat to power plant under construction in Gusagara district

 The plant located in the southern province district of Gisagara produces some 80MW of electricity from peat. Dr. Ndagijimana also revealed that works on the Rwanda-Burundi-Kigoma-Ngozi and the Rusumo-Bugesera-Shango powerlines will continue. 

 He said that the government has earmarked 240 trading centers across the country which will be added on the grid to boost the different socio-economic activities happening there while 118,657 new households will be added on the main grid and 50,000 households connected through solar.

Minister Ndagijimana said that the government will accelerate domestic projects to improve transportation of people and goods, with the transport sector receiving Rwf243.3 billion in funding. 

The money will go towards the construction and repair of major national highways, including Kagitumba-Shinga-Gasoro road (66Km), currently at 80% and Huye-Kibeho-Ngoma/Munini (66Km) road now at 75%.

 The government also said it will construct or repair at least 450 km (about 60%) of the feeder roads in the districts of Gatsibo, Nyagatare, Nyabihu, Rutsiro, Gakenke and Nyaruguru Districts.

Proposed new railway line. Tanzania-Rwanda-Burundi

 In what could be a major development, Dr Ndagijimana said the demarcations of the planned railway line will be drawn but did not reveal which one it will be -whether it will be the line linking Kigali to Dar es Salaam or Mombasa.

 The Minister revealed that the government will buy a mobile relief bridge to be used during emergencies while more bridges will be constructed on Rubagabaga and Satinskyi rivers. Still in the maritime, he said the government will also build 4 ports on Lake Kivu -in Rusizi, Rubavu, Karongi and Nkora.

 Agriculture gets boost

Maize drying machine in Rwamagana – Eastern Rwanda

 The agriculture sector is expected to get Rwf122.4 billion to go towards increasing agricultural output through incentives to farmers and the development of infrastructure to combat erosion as well as boost irrigation.

Irrigation dam-rulindo district

 The Finance Minister said that efforts will be directed towards improving output while minimizing post-harvest losses. The government intends to increase agricultural stockpiles through special reserves for emergency use. At least 7,000 Tons of maize and 3,000 Tons of beans will be stored in the state silos.

Store of maize in Rwamagana, Eastern Province

 Rwf47.9 billion will be directed towards urban development projects in the City of Kigali and secondary cities, especially infrastructure for affordable housing projects.

 Rwf49.6 Billion will be channelled into sustainable conservation of natural resources while Rwf27.4 billion will go towards disaster prevention initiatives.

 Social Protection & Health

 Among the economic clusters, getting a lion’s share of the 2020/21 budget is social protection which will see the government invest Rwf960.4 billion, equivalent to 29.6% of the total budget, in programmes to improve the well-being of the people through strategies that help the people to have the necessary skills, live well and be safe.

 Of that amount, Rwf129.2 billion will go directly into social protection programs such as Vision Umurenge Programme (VUP) which targets vulnerable and disadvantaged people.

 Dr Ndagijimana said that the government will review the Ubudehe categories to have more reliable information to use while allocation social protection benefits to the citizens.

 In order to solve problems that are detrimental to social and human development, districts are building about 541 houses for the survivors of the 1994 Genocide against the Tutsi while another 44, 822 houses for needy families are being constructed or refurbished.

 In healthcare, the government will invest Rwf261.1 billion towards bringing healthcare services closer to the people by building health infrastructure across the country including hospitals, health centres and primary health centres commonly known as postes de santé, among other things.

 The hospitals to be completed include Nyabikenke Hospital, Munini Hospital and construction of the Training and Research Centre for Rheumatoid Arthritis (IRCAD). 

Munini Hospital

Dr Ndagijimana said that a portion of the money will go towards continuing awareness campaigns and prevention measures against the spread of the COVID-19 epidemic as well as treatment for Tuberculosis, Malaria and HIV/AIDS.

 Some Rwf61 billion will go into sustaining the fight against Malaria and other epidemic diseases such as AIDS and tuberculosis.

 In the 2020/21 financial year, Rwf52 billion will go to clean water distribution projects, including the launch of Kanzenze Water Treatment Plant in Bugesera District and continued construction of the Gihira II water treatment plant in Rubavu District in Rubavu districts among other projects.

 Still in the social sector, Rwf2 billion, will be invested in strengthening the principle of gender equality and family development, especially in combating violence against women.

 Governance

 In other key areas, the government will sink Rwf482.6.3 billion, equivalent to 14.9% of the total budget for the year 2020/21 in promoting good governance and justice as a pillar of sustainable development.

 At least Rwf57 billion of the amount will go towards improving service delivery in the public, private and non-governmental organizations (CSOs).

 The government targets increasing the number of services provided through technology, especially those that will be launched on the IREMBO website as well as using technology to access healthcare services. Dr Ndagijimana said that more than 100 services will be added to the services provided digitally.

Irembo platform

 Among other things, the government will establish a system that register births, marriages, divorces and registering deaths at the scene (healthcare facilities).

 The Judiciary will get Rwf316.1 billion to go towards upporting the activities of Legal Aid (MAJ), and Mediators, construction of local courts in Bugesera, Gasabo, Rulindo and Muhanga Districts.

 Part of the funds will go towards the construction of Phase II of Mageragere Prison, and Nyamagabe Prison.

 In Education, the Government will invest Rwf106.7 billion in a project to improve the quality of basic education in order to increase the number of staff while Rwf77.8 billion will be allocated to construction and renovation of classrooms across the country. Similarly, Rwf20.1 billion will be sunk in the Anti-Childhood and Child Maltreatment Project.

 Worth noting, the government will invest an additional Rwf6 billion in further installing surveillance equipment on public roads and public safety areas while Rwf4.4 Billion will go into cyber security initiatives.

 Rwf3 billion will be invested in building a state-of-the-art Automated Driving License Centre while Rwf1.9 billion will be dedicated to the National Police Capacity Building Project.

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Elias Hakizimana

Elias Hakizimana, CEO&Founder of The Inspirer Ltd,(www.rwandainspirer.com) is a professional Rwandan Journalist with Bachelor’s Degree in Journalism and Communication, received from University of Rwanda’s College of Arts and Social Sciences (CASS) in 2014. He served various media houses in Rwanda including Rwanda Broadcasting Agency (RBA) in 2013 and became passionate with English Online and Print Media Publications where he exercised his talent as a Freelance News Reporter for The New Times, The Independent, The Rwanda Focus, Panorama and more before he became a Self-Entrepreneur as the CEO and Founder of The Inspirer Limited in early 2017.

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