By: Jennifer Fierberg
Rwanda is often touted as a “financial success story” in many publications yet the smoke screen of propaganda quickly dissipates when the reality of facts and statistics confront the mirage. While there certainly are development successes in the country since the war in 1994 the cover up of the financial challenges are much deeper in number.
In 2009, an paper entitled “Rwanda Today: When Foreign Aid hurts More than it Helps,” was published by co-authors Dr. Emmanuel Hakizimana of the University of Quebec in Montreal and American Professor Dr. Brian Endless at Loyola University who is the Director of African Studies and the African Diaspora set out to analyze the financial situation in Rwanda. Dr. Emmanuel Hakizimana granted an interview regarding this paper and how the financial climate has changed in Rwanda has changed since its publication and how these developments directly affect reconciliation inside the country.
Dr. Emmanuel Hakizimana is an economist and Secretary General of the Rwanda National Congress. He is a distinguished graduate where he studied and taught at the National University of Rwanda until 1993. He continued his studies in Canada earning a Master’s Degree at the University of Montreal and a Doctorate from the University of Quebec in Montreal. He currently teaches at the University of Quebec in Montreal and his fields of research are international finance, business cycle fluctuations and economic development.
The interview is in full below:
JF: How has the economic climate changed since 2009 when you published your paper with Professor Brian Endless, “Rwanda Today: When Foreign Aid Hurts More Than It Helps”? What inspired you to write that piece at the time?
EH: I wrote this paper in 2009, but the issues raised then were a major concern for me long before, and I had already written a few short articles on the topics. Like many observers of the political scene in Rwanda, I had noted how the RPF regime was leading the country on a dangerous path, where another tragedy was looking more and more as the ineluctable end result. Increasing income inequalities year over year, discriminatory policies among survivors of the Rwandan tragedy, human rights and economic rights violations were and still are among other troubling patterns everyone could see.
Unfortunately, the international community that has always showered the regime with millions of dollars in direct aid did not seem to read the same menacing signals. The question of whether or not all that foreign aid helped to foster reconciliation among the people of Rwanda is not keenly asked even though donors are cognizant of how fragile the social fabric has become since the war, crimes against humanity and the Tutsi genocide that came with it.
For the majority of the Rwandan population, economic situation has not changed since 2009. In some aspects, it is even worse.
JF: In the above named publication, you state, “no successful fight against poverty is possible in Rwanda as long as the issue of power sharing between Hutu and Tutsi remains unsettled.” What does one have to do with the other?
EH: As co-author Brian Endless and myself established, pairing statistical data to other known facts allows painting a picture of systematic discrimination against Hutus. For instance, agriculture in the rural sector where Hutus are disproportionately employed has been underfunded; no recognized assistance was put in place for Hutu orphans and widows, survivors of various crimes against humanity; the suppression of French as an education language in favor of English rendered irrelevant their education assets and professional skills for Hutu intellectuals; scores of abuse, injustices and basic rights violations disproportionately targeted Hutus.
Economical analysis of the RPF policies and practices showed the majority of the Hutu population put on the path of increasing pauperization in the short to long run. Data collected for the 2009 paper confirmed a significant under-representation of Hutus in higher echelons of public administration and the army, and consequently their de facto exclusion from the decision making process in important matters of their country.
This is what led us to conclude that as long as the problem of power sharing between Hutus and Tutsis remains unresolved, there is no guarantee that each group’s interests, including economic, will be fairly protected.
We must underline however that the current regime does not represents the interests of the Tutsi. Far from it! Many Tutsi have been imprisoned, tortured, killed or driven into exile. The regime in Kigali, a fierce dictatorship which has ruthlessly exploited the 1994 genocide of Tutsis to blackmail the international community into a “guilt” sympathy, does not defend anybody’s interests but those of an ever shrinking small circle of individuals around President Kagame. The systemic discrimination against Hutus is not an end in itself, but rather a mean to eliminate all opposition to President Kagame’s bad policies, including opposition from fellow Tutsis.
JF: How have the aid cuts in 2012 affected Rwanda in the long run?
EH: The long term impact is likely to occur in areas such as education, health, infrastructures and other programs primarily targeting poverty reduction. Like all dictatorial regimes, the Rwandan government did not make good use of the scarce resources after budgetary aid cuts. On the contrary, the Kigali regime has continued to direct the bulk of the budget to the purchase of heavy and sophisticated armaments as well as maintaining a plethoric army and excessive security forces. This is clearly the proper of a dictatorial regime which, having been unable to win the trust of the citizens relies on its army and police forces. Another example of ineffectual expenditure is the funding of extravagant presidential travels to Europe and North America where paid gatherings of President Kagame admirers are organized frequently.
As a direct consequence of the foreign aid cuts, the fiscal burden borne by the population is heavier than what the official statistics would reveal. The Kigali regime introduced among other disguised taxes the contribution to the Agaciro Fund or the payment to the “Local Defense”, without even revealing the use of the collected amounts. People, especially the most economically vulnerable among them, cannot hope to break the vicious circle of poverty by sending their children to school, their disposable income shrinking year after year.
We have to bear in mind that the foreign aid cuts were a direct response by various donors to a damning report by UN experts documenting the support of Kigali to the M23, a rebel group wreaking havoc in Eastern Democratic Republic of Congo (DRC). Rwandans, ultimately, are paying the costs of the criminal adventures of their president.
JF: You were quoted in an interview in the Toronto Star in 2013 ahead of Rwanda Day where you stated, “We want true reconciliation, freedom and economic progress.” Yet, Rwanda is hailed as an economic success story, via their development, in the West. Why do the mixed messages differ so greatly?
EH: It’s an open secret that the Rwandan regime is among the most generous patrons of lobbying agencies in various foreign capitals. Despite its image being keenly and constantly polished, the truth on the ground keeps coming up to state the opposite. To illustrate the above, let’s look at two so-called success stories: fight against poverty reduction and income distribution.
According to the World Bank, 63% of the population lived on less than $ 1.25 per day in 2011. That is exactly the same proportion as in 1985. So, despite the hundreds of millions of dollars that were handed to the regime placing Rwanda among the top destinations for international aid, the majority of the population suffers as much poverty as thirty years ago!
With respect to income distribution, facts speak to a less vibrant economy than the government would have us believe. The proportion of the richest 20% in the national income climbed from 39% in 1985 to 51% in 2000 then rose further to reach 57% in 2011. In other words, 80 % of the population in 2011 shared only 43% of the country’s production. That’s exactly the share of income of the 10% richest people. Unfortunately, this is specific to societies where leaders don’t care about the well-being of the majority of the population. It underscores once again the impossibility of combating poverty in Rwanda without first solving the political problems.
JF: Why does Rwanda lack poverty reduction programs in rural areas? Is it that the rural areas are primarily Hutu or simply a location issue with the greater focus being on Kigali?
EH: To an untrained eye, extreme poverty that continues to plague rural areas might seem like a simple consequence of a difficult policy decision where scarce resources are allocated to Kigali and other cities instead of the campaigns. However, given the regime’s documented tendency to consider Hutus as second class citizens, this situation is in total agreement with other discriminatory policies against Hutus who predominantly live in rural areas. It concords with the already mentioned non assistance of Hutu survivors, the violation of their most fundamental rights, and more recently the “Ndi Umunyarwanda” program which, in order to conceptualize the practices that discriminate against them indefinitely, obliges all Hutus, even those who were not born in 1994, to ask for forgiveness for the crimes committed by their congeners.
JF: Access and affordability of education is key to poverty reduction in any society. The government of Rwanda proudly boasts free education and high enrollment rates but your figures from 2009 paint a different picture. Poverty continues to be a pervasive problem in Rwanda as well as low education enrollment. If education is free for all in Rwanda why are the poorest in Rwanda continuing to struggle to pay for education?
EH: To better assess the picture, let’s review the overall plan and compare Rwanda to similar countries, in this case Sub-Saharan Africa.
According to the 2014 UNDP report, the rate of school dropout was 64.4% among children at the elementary level while the average for Sub-Saharan Africa was 37.7%. According to the same report, the average length of education in Rwanda is 3.3 years, while the average for Sub-Saharan Africa is 4.6 years. Finally, the population over 25 years old who completed a high school education or higher was 7.7% in Rwanda, when Sub-Saharan Africa average was 28%. These figures are a clearly not good cause for celebration if the concern about the well-being of the population in Rwanda is real.
Obviously, it is among the most vulnerable that the impact is largest, and they are a big fraction of the population. In fact, 34.6% of the Rwandan people live in extreme poverty. These are people who struggle for a meal even once per day. So, it is not surprising that adverse effects on education are this durable.
JF: What are your thoughts on Christine Lagarde’s, of the IMF, visit to Rwanda and the statements she made while there? Do you think her visit will effect change for the positive in Rwanda? Does Kagame only respond to such pressure when money is at stake?
EH: Ms. Lagarde’s speech raised some crucial points but, at the same time, it showered the regime in Kigali with unwarranted praise. For that reason, I doubt it will bring about positive change in Rwanda. For example, she commended Rwanda for its governance, but two days after her speech, Transparency International Rwanda issued a report revealing that all 30 districts of Rwanda are plagued by bad management of public funds. Just for fiscal year 2012/13, corrupt misconduct accounted for RWF 107.2 billion on a budget allocation of RWF 277.9 billion. Furthermore, it is common knowledge that president Kagame is entangled in huge conflicts of interest that cannot be tolerated in any well-run society. He grants enormous public contracts to an RPF company – Crystal Ventures, of which he is president and which is the second largest employer in Rwanda behind only the government. Ignoring such blatant abuse and many others will be interpreted as an unjustified recognition for the regime extremely deplorable practices.
JF: In your opinion, what changes need to happen for all Rwandans to have economic equality inside Rwanda? What do you see at the top priorities for economic change in Rwanda?
EH: As I already mentioned, economic development requires some prerequisites in the business environment. It is indispensable, for example, that people enjoy economic freedom and that property rights are respected and protected. There must be political stability based on democratic principles. However, we know that none of these conditions is met in Rwanda. The greatest violations of economic rights are perpetrated against peasants and farmers who cannot use their land and dispose of their crops as they see fit for their families. Similarly, under various pretexts, people are dispossessed of their property and/or killed because of their possessions. The case of businessman Assinapol Rwigara recently murdered while he had pending lawsuits against the Rwandan authorities to recover his possessions is very eloquent.
Rwanda should make good use of the existing regional integration bodies like the East African Community (EAC) and the “Communauté Économique des Pays des Grands Lacs” (CEPGL). Unfortunately, due to its belligerent adventures, Rwanda has become the epicenter of instability in the African Great Lakes region.
Rwanda is in urgent need for foreign capital and better integration to regional markets to grow. However, it will not get there until it has cleaned up the business environment by adopting the principles enunciated above and has eliminated the risk of instability by becoming a rule of law state based on principles of democracy and fairness.