Rwanda has achieved high growth and macroeconomic stability under three successive Poverty Reduction Growth Facility (PRGF) arrangements. Executive Directors welcomed the new Private Sector Investment (PSI) program, which aims to consolidate macroeconomic stability and achieve sustained broad-based growth while reducing Rwanda’s aid dependency. They emphasized that this can be achieved by maintaining sustainable fiscal position, strengthening monetary and exchange rate policies, and supporting growth with structural reforms. In view of this, Directors approved a three-year PSI for Rwanda for preserving macroeconomic stability, consistent with the authority's poverty reduction and growth strategy, Economic Development and Poverty Reduction Strategy (EDPRS).
Consistent with debtmanagementconcerns, the treasury bill market should be designed with a view to sterilizing the structural liquidity of the banking sector in the cheapest possible way and contributing to the development of financial markets . In reality, many countries, especially developing and emerging market ones, use both central bank and treasury bills. In such cases, the overriding factors should be the extent to which: (i) operational independence for the central bank is ensured; (ii) the development of liquid markets is fostered; and
ultimate means to reduce poverty in a sustainable manner. That is why the scaling up of economic infrastructure investments to foster growth is key and remains an unwavering policy stance of my authorities in the dialogue with partners. While being cognizant of the need to maintain debt ratios at sustainable levels, my authorities have continuously drawn the attention of their partners on the fact that debtmanagementconcerns should accommodate countries’ pressing and huge needs of infrastructures and capital goods.
Two of my authorities’ strategic investment projects
This paper discusses the challenging question of whether central banks should use treasury bills or central bank bills for draining excess liquidity in the banking system. While recognizing that there are practical reasons for using central bank bills, the paper argues that treasury bills are the first best option especially because positive externalities for the financial sector and the rest of the economy. However, the main considerations in the choice should be: (i) operational independence for the central bank; (ii) market development; and (iii) the strengthening of the transmission of monetary policy impulses.
maturity is expected to be a little higher than one year (the rest is assumed to be long-term debt). It is assumed that 60 percent of the short-term domestic debt rolls over each year, at which time it is affected by the higher interest rates.
27 Nonetheless, individual countries would need to be mindful of longer-term debt sustainability and more immediate debtmanagementconcerns in making decisions about placing additional debt.
28 In SSA, energy subsidies amounted to 1½ percent of regional GDP or 5½ percent of total government revenues in 2011, with
An assessment of vulnerabilities and risks in LICs remains important both for LICs themselves and for the international community. There are currently 74 LICs, eligible for concessional financing from the Fund. This group of countries has a total population of about 1.3 billion, with an average per capita income of around $850. They typically face the steepest challenges in meeting the Millennium Development Goals (MDGs) and are increasingly the focus of global development assistance to assist them in this endeavor. This report serves several purposes. It provides a cross-cutting analysis of the economic vulnerabilities of LICs, yielding some general policy conclusions and messages aimed at strengthening their resilience to external shocks. It delivers a richer coverage of developments in LICs than is typically contained in the major IMF multilateral surveillance reports, where analysis is focused primarily on developments in the advanced and emerging market economies. The report serves as an effective outreach tool to country authorities and the wider public. Finally, it provides useful information to other international financial institutions (IFIs) and donors that provide financial resources to LICs on the potential financing needs of these countries under varying global scenarios.