Rwanda GDP grows by 11.9% in 2019 third quarter

On 12 December 2019 at 05:01

Rwanda’s Gross Domestic Product (GDP) in the third quarter of 2019 has grown by 11.9%, reaching Rwf 2,358 billion from Rwf 2,065 billion recorded in the third quarter of 2018, the National Institute of Statistics of Rwanda (NISR) has announced.

Statistics published this Thursday, December 12th, 2019 show that the service sector contributed 49%, agricultural sector 27% and industrial sector 17%.

Some of the factors that led to the growth in GDP in the industry sector include booming construction activities that rose by 29% as well as manufacturing whose value increased by 13%. However, the mining sector’s performance reduced by 16%.

Yusuf Murangwa, the Director-General of the National Institute of Statistics of Rwanda says that the poor performance in the mining sector was due to low outputs of Cassiterite, Coltan, and Wolframite which led to a reduction in exports.

The prices of the aforementioned minerals have also considerably reduced on the market, hence the low income.

GDP in the service sector increased by 13% due to the high performance of privately owned companies of which output increased by 25%.

Transport increased by 18% and the investment sector by 9% while hotels and restaurants output increased by 15%.

In agriculture, an increase in output by 8% resulted from the increase in cash crops by 5% and the increase in agricultural exports by 22% including a large portion of coffee production by 22% and tea by 29%.

Murangwa explained the volatility of market prices these days which contrasts and compromises the high GDP increase reported by NISR. He explained that there is a growing demand that does not match the supply.

“We are facing high demand due to population increase and the scarcity inevitably results into the increase of prices on the market. The economic situation was stable until July this year and if there is a satisfying harvest and favorable weather in December, prices might get back to normal.”

Currently, the prices used to determine GDP are from 2014 but Murangwa explained that the income approach used to calculate GDP allows NISR to use market prices for a period of 5 years. Starting next year, Rwanda will be using new market prices to calculate GDP.

The prices of the aforementioned minerals have also considerably reduced on the market, hence the low income.