Kagame’s Currency And External Trade Collapsed In 2019

The Rwandan Franc has plummeted to the lowest level of RWF930 to US$1

Data from General Paul Kagame’s own government paints a dismal picture of Rwanda’s currency and external trade for 2019. The currency kept collapsing and currently trades at RWF930 to US$1. Meanwhile, all principal exports sharply declined – thus inflicting pain on exporters and Rwandans who make a living in the export sector. How would Kagame explain this if there was a genuine parliament to hold him accountable? We of course know that on February 27, 2019, Kagame closed the border with Uganda – Burundi border is also suppressed. Here, Kagame played with fire. The Northern Corridor is the busiest and most important transport route in East Africa, providing a gateway for land-locked Rwanda through Uganda to the Kenyan seaport of Mombasa. Does the collapse of the currency and the dismal trade figures have anything to do with this self-inflicted sabotage? These are the issues Kagame would explain to the people of Rwanda if he were accountable to them.

It turns out that almost all Rwandan principal exports dropped substantially in the first seven months of 2019.

Rwandan export performance in the seven months of 2019 was dismal. The National Bank of Rwanda’s data provides a rather gloomy picture in this regard.

  1. Coffee exports dropped by 5 percent from US$36.1 million in January-August 2018 to US$34.3 million in January-August 2019.
  2. Tea exports dropped by 10 percent from US$66.2 million to US$59 million.
  3. Cassiterite exports dropped by 22.3 percent from US$35 million to US$27.3 million.
  4. Coltan exports dropped by 39.5 percent from US$49 million to US$29.6 million.
  5. Wolfram exports dropped by 6.6 percent from US$13.3 million to US$12.4 million.
  6. Hides and Skin exports dropped by 50.4 percent from US$5 million to US$2.5 million.
  7. Only Pyrethrum increased by 56.6 percent from a miserable US$2.4 million to US$3.7 million.

In total, the value of Rwanda’s principal exports dropped by 18.5 percent from US$207.5 million in January-August 2018 to US$169.2 million in January-August 2019.

Meanwhile, Rwanda’s import bill increased by 15.7 percent from US$1.5 billion in January-August 2018 to US$1.7 billion in January-August 2019.

That is where genuine accountability would come into the picture. Kagame would explain why Rwanda’s balance of payments worsened in 2019. His government would also explain future plans regarding border closure and international trade. This is a man who travels the world singing about how Rwanda will soon prosper by participating in the African Continental Free Trade Agreement (AfCFTA). How does one close a border to his immediate East African trading partners and participate in the broader AfCFTA?

I realize, of course, that I am engaged in fantasy here. Kagame might as well be an alien who does not give a damn about his actions as he often says.

General Kagame reminds me of the often repeated story of the forest and the axe. Because the axe’s handle is wood, the trees mistakenly imagined that the axe was one of them. But Mr axe kept chopping down the trees while the forest kept shrinking. Sadly, the trees in the forest had no means of getting rid of the axe. The forest was subsequently destroyed. Likewise, Rwandans are at the mercy of the axe – General Kagame.