The agreement covers economic policies and reforms required to complete the first review of Rwanda’s Extended Credit Facility arrangement.
It remains subject to approval by IMF Management and the Executive Board, which is expected to consider the review in December. “The Rwandan authorities and IMF staff have reached a staff-level agreement on the economic policies and reforms needed to complete the first review,” IMF Mission Chief for Rwanda Albert Touna Mama said.
Rwanda’s economy grew by 9.7% during the first half of 2026 despite recent global and domestic shocks.
Strong exports and remittance inflows helped narrow the current-account deficit, while foreign-exchange reserves remained sufficient to cover about four months of imports.
The depreciation of the Rwandan franc also moderated. However, inflation reached 15.7% in August, remaining substantially above the National Bank of Rwanda’s medium-term target of 5%.
The IMF attributed the increase to existing price pressures and higher international oil and fertiliser prices.
All quantitative programme targets for the end of June were met. Rwanda also advanced reforms aimed at strengthening the investment framework and deepening domestic securities and foreign-exchange markets.
Fiscal performance remained strong, with the deficit falling to 4.8% during the 2025/26 financial year.
Tax collection exceeded expectations, while passing higher international costs through to pump prices limited government fuel subsidies. “Sustained fiscal consolidation will be critical to preserve a moderate risk of debt distress and rebuild policy buffers,” Touna Mama said.
The IMF called for stronger domestic revenue collection, careful prioritisation of foreign-financed capital projects and continued protection of social and other priority spending.
Economic growth is projected at 7.8% in 2026 before moderating to 7% in 2027.
Risks include volatile commodity prices, geopolitical tensions, tighter global financing conditions and El Niño-related climate shocks.
The IMF said Rwanda’s new petroleum procurement framework could improve fuel security and make purchasing costs more competitive.
The National Bank of Rwanda has tightened monetary policy in response to elevated inflation. “An appropriately tight, data-driven monetary policy stance remains important,” Touna Mama said.
The approach should prevent price increases from spreading more broadly and guide inflation towards the central bank’s 5% target.
–IMF/ChannelAfrica–
