Global rating agency Moody’s has affirmed Rwanda’s B2 long-term rating, citing institutional strengths.
A B2 rating is considered speculative and subject to high credit risk.
In its latest assessment, Moody’s noted that although Rwanda’s debt burden has risen in recent years and is unlikely to decline in the next few years, the country's demonstrated institutional strength will allow the government to maintain macroeconomic and financial stability and manage this burden.
“The quality of Rwanda's institutions supports the government's ability to manage the risks associated with a higher burden. Rwanda has a track record of effective policy implementation and reform,” said the agency.
“Budget projections have been broadly met, the government efficiently utilises concessional funding sources rather than rely on commercial sources, and the government has shown an ability to mobilise domestic revenue.”
Rwanda’s debt-to-GDP ratio has risen by 21 per cent since 2011 to 43 per cent in 2017. At this level, it is still lower than its East African neighbours’, with Uganda’s at 50 per cent, and Kenya and Tanzania at 56 per cent.
Moody’s forecast a positive outlook for the Rwandan economy, which is expected by 6.5 per cent this year, up from a projected 5.2 per cent last year, according to the country’s central bank.
