This stable stance reflects confidence in the country's economic trajectory and growth prospects.
A statement released by the agency last week shows that Rwanda's rating indicates a balance between the country's vulnerability to balance-of-payments and efforts to improve fiscal position, sustained growth, and continued access to concessional financing.
According to S&P Global, Rwanda's advantageous debt profile is visible, characterized by concessional loans with extended repayment terms. This debt structure has significantly reduced the country's debt servicing costs compared to its peers.
With projected interest payments accounting for only 9.1% of government revenue between 2024 and 2027, S&P Global predicts that Rwanda will outpace regional economies over the next five years, driven by substantial public investments.
Rwanda's economy grew by 8.2% in 2023 with year-on-year growth accelerating to 10% in the fourth quarter of 2023 and maintaining a similar pace in the first quarter of 2024.
Although agricultural output grew slowly in 2022 and early 2023, favourable weather conditions are expected to normalize production. Additionally, ongoing growth in the services sector is expected to boost private sector engagement from its current level.
While acknowledging Rwanda's economic progress, S&P Global also highlighted the country's vulnerability to climate change impacts, such as the severe flooding experienced in 2023.
The rating agency also lauded the government's swift response to the floods through the implementation of infrastructure rehabilitation projects and enhanced preparedness measures to mitigate potential future shocks over the coming four years.
Wycliffe Nyamasege
Source : https://en.igihe.com/news/article/rwanda-s-credit-rating-remains-stable-at-b-s-p-global-reveals
