1999-2000 Rwanda Burundi

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Comparative economic indicators, 1998

EIU Country Profile 1999-2000 © The Economist Intelligence Unit Limited 1999 1

July 19th 1999 Contents

4 Rwanda

4 Basic data

5 Political background 5 Historical background 11 Constitution and institutions 12 Political forces 15 International relations and defence

17 Resources 17 Population 18 Health 18 Education 19 Natural resources and the environment 19 Transport and communications 20 Energy provision

21 The economy 21 Economic structure 22 Economic policy 24 Economic performance 26 Regional trends

26 Economic sectors 26 Agriculture, forestry and fishing 28 Mining 28 Manufacturing 29 Financial services 29 Other services

30 The external sector 30 Trade in goods 32 Invisibles and the current account 32 Capital flows and foreign debt 33 Foreign reserves and the exchange rate

34 Appendices 34 Regional organisations 34 Sources of information 36 Reference tables 36 Population 36 Population breakdown by age 36 Labour force 36 National energy statistics 37 Government finances

37 Money supply 37 Gross domestic product 37 Gross domestic product by expenditure 38 Gross domestic product by sector 38 Consumer prices 38 Food crop production 38 Agricultural production for export 39 Minerals production 39 Manufacturing production 39 Exports 40 Imports 40 Main trading partners 41 Balance of payments, IMF estimates 41 External debt, World Bank estimates 42 Net official development assistance 42 Foreign reserves 42 Exchange rates

43 Burundi

43 Basic data

44 Political background 44 Historical background 49 Constitution and institutions 49 Political forces 52 International relations and defence

53 Resources 53 Population 54 Health 54 Education 55 Natural resources and the environment 55 Transport and communications 56 Energy provision

57 The economy 57 Economic structure 58 Economic policy 60 Economic performance 61 Regional trends

62 Economic sectors 62 Agriculture, forestry and fishing 64 Mining and semi-processing 64 Manufacturing 65 Financial services 65 Other services

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66 The external sector 66 Trade in goods 67 Invisibles and the current account 68 Capital flows and foreign debt 69 Foreign reserves and the exchange rate

70 Appendices 70 Regional organisations 73 Sources of information 74 Reference tables 74 Population 75 Civil service labour force 75 Transport statistics 75 National energy statistics 76 Government finances 76 Money supply 76 Interest rates 77 Gross domestic product 77 Gross domestic product by expenditure 77 Gross domestic product by sector 77 Prices and wages 78 Food and cash crop production 78 Selected manufacturing production 78 Exports 79 Imports 79 Main trading partners 80 Balance of payments, IMF estimates 80 Balance of payments, national estimates 81 External debt, World Bank estimates 81 Public-sector debt 82 Net official development assistance 82 Foreign reserves 83 Exchange rates

Rwanda

Basic data

Land area 26,338 sq km

Population 8.08m (1998 EIU estimate)

Main town Kigali (capital) 500,000 (1997 estimate)

Climate Tropical, moderated by altitude

Weather in Kigali Average annual temperature 19°C, average monthly rainfall 85 mm

Languages English, French and Kinyarwanda

Measures Metric system

Currency Rwandan franc (Rwfr)=100 centimes. Average exchange rate in 1998, Rwfr312.3:$1; exchange rate on July 8th 1999 Rwfr336.5:$1

Time 2 hours ahead of GMT

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Political background

Historical background

The region’s pre-history Rwanda and Burundi’s human history began with the Twa, who inhabited the country’s rainforests for thousands of years, living as hunter-gatherers. Between the fourth and seventh centuries AD, a group of Bantu clans settled in the region, clearing much of the forest, cultivating the land, and bartering skins and meat for salt and iron goods. The region’s Tutsis are held by some historians to have developed from this group as a cattle-owning class; certainly cattle ownership enabled many Tutsis to act as patrons in a network of complex relationships with Hutus. However, historians who attribute a distinct ethnicity to Tutsis say that they arrived as pastoralists into a predominantly agricultural Hutu society, probably in the 11th and 12th centuries AD. The theory that Tutsis are Hamitic and originate from Ethiopia—popular with the colonial authorities and some ideologues today—has been discredited.

Pre-20th century Rwandan A Tutsi mwami (king), Ruganza Barimba, began amalgamating Tutsi monarchy chieftaincies under his rule in the 15th century. There followed a lengthy period of steady expansion for the monarchy. Kigeri Rwabugiri, who died in 1895, brought the last of the Tutsi chieftaincies under royal control. However, neither he nor his predecessors made much impact on the Hutu chieftaincies of the north, which retained independence.

The colonial period Germany began its colonisation in 1903, and predominantly French and Belgian Roman Catholic missionaries called the White Fathers began proselytising around the same time. Having started by subduing the mwami kingdom, Germany eventually also brought the Hutu chieftaincies under its imperial control. Germany ruled Rwanda and Burundi until its defeat in the first world war, when Belgium assumed power over the territory, named Rwanda-Urundi.

In the 1920s and 1930s colonial authorities oversaw extensive coffee planting and enforced tax collection in cash, not kind, to enforce coffee’s cultivation and draw Rwandans into the monetary economy. The authorities also streamlined local government. In 1926 they merged the traditionally separate land, cattle and army chiefdoms on each “hill” (Rwanda’s socio-economic unit) into one centrally appointed post, which almost invariably went to a Tutsi, greatly increasing Tutsi political control and Hutu resentment at local level.

Political polarisation on Belgium experimented tentatively with limited democratic reforms in the early the eve of independence 1950s. Displeased by slow progress and mistrustful of Belgian intentions, the UN sent a mission in 1957 which accelerated the pace of political change in Rwanda. A Hutu Catholic catechist named Gregoire Kayibanda wrote a manifesto to coincide with the visit, demanding elections and the establishment of democratic institutions before independence. Kayibanda received support from the White Fathers and the colonial administration, which had turned away from the increasingly antagonistic Tutsi elite and

sought to use their new-found commitment to majority rule to delay any loss of imperial power. Fearing that elections might see them deposed by hostile Hutu political forces, mwami Mutara and the Tutsi aristocracy agitated for immediate independence for Rwanda, with future elections to be organised by them and not the apparently treacherous Belgians, who appeared to this elite as ready to deliver them to the hostile mob.

The meanings of “Hutu” and “Tutsi”

The meanings of ethnic terms are fluid and evolve with historical events, although their attraction and authenticity derive from their appeals to tradition and history. Rwandans are profoundly divided on whether the original meanings of “Hutu” and “Tutsi” lie in class or ethnicity, and because this division has so infused the politics of the past 40 years, attempts to resolve the matter rarely remain impartial for long.

One meaning of “Hutu” and “Tutsi” is “client/servant” and “patron/master”, enabling someone to be a Hutu to one person, and a Tutsi to another. For example, during the days of the monarchy everyone was a Hutu in relation to the mwami (king). However, other meanings refer instead to parentage and lineage.

Colonial rule, which began in 1899, had a substantial impact on the meanings of “Hutu” and “Tutsi”, in part because of the speculative and inaccurate theories held by administrators and the Roman Catholic Church, who believed that Tutsis were Hamites (sic) from Ethiopia, and therefore somehow “sub-Aryan” and thus not Bantu, like Hutus. The argument continued that, as sub-Aryans, Tutsis were superior to Hutus, in part because they must once have been Christian. Bringing the Tutsis back to their ancient Christian roots evolved as the God-given duty of the White Fathers, who believed that if they succeeded in reconverting the Tutsi community, the Tutsis would ensure that Hutus saw the light too.

To “prove” the ethnic distinctiveness of Tutsis, Hutus and Twa and legislate accordingly, apparent physical differences between them were perpetually invoked by the colonial authorities, and the point was soon reached where the tallest, thinnest-nosed and longest-fingered became cast as Tutsi archetypes, with the stockiest, widest-nosed and shortest-fingered cast as their Hutu counterparts. The same physical criteria were used during the 1994 genocide to identify targets for slaughter.

Enforced coffee planting and the monetisation of the economy transformed Rwandan social relations. Patron-client relations previously based on cattle ownership and usage now incorporated coffee crop ownership for patrons and wage-labouring for clients. To wage-labourers, “Tutsi” came to imply “boss”, while owners and overseers came to equate “Hutu” with “worker”. In the charged atmosphere just before independence, these easily became “exploiter” and “the mob”.

The terms have now assumed new meanings through the atrocities that have befallen both Rwanda and Burundi since independence. Being a Rwandan Tutsi today is to belong to the community persecuted since 1959 and decimated in the genocide in 1994. Being a Rwandan Hutu is to belong to the regional community massacred in Burundi in 1972, 1988, 1990 and 1991, in northern Rwanda in 1990-94, and in eastern Zaire from late 1996 to mid-1997. As a result, the terms imply and signify more polarisation than ever, making reconciliation a profoundly difficult challenge.

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The first ethnic massacres Mwami Mutara died in 1959, and many Tutsis believe the Belgians were after independence responsible for his death. He was succeeded by mwami Kigeri V. In 1959 monarchists founded the Union nationale rwandaise (Unar), and Kayibanda the Mouvement démocratique républicain-PARMEHUTU (MDR-P). Politically orchestrated communal violence, known as the muyaga (“wind”) resulted in thousands of, mostly Tutsi, casualties. Around 300,000 Tutsis fled Rwanda for Burundi and Uganda, leaving MDR-P to win communal elections in 1960, which led to more politically orchestrated ethnic killings and more Tutsi refugees. This prompted greater UN support for Unar, but in 1961 MDR-P toppled the monarchy in a coup supported by Belgium. The party won a legislative election in 1963 and broke with Burundi, establishing the Republic of Rwanda.

General Habyarimana’s Subsequent invasions by refugees prompted increased internal repression of coup Tutsis by the new regime. At the same time, state patronage became progressively centred on Hutus from Gitarama, alienating other Hutus. Northern Hutu bakonde (lords), who had hoped the new regime would return their ancestral lands, found them occupied by MDR-P party members from central Rwanda. In 1973 the army chief-of-staff, Major-General Juvénal Habyarimana, whose father-in-law was a Hutu umkonde (lord) from Gisenyi in the north-west, staged a successful coup d’état.

There followed more politically planned violence, this time with around 100,000 people massacred. The victims were prominent MDR-P supporters, including Kayibanda, but most were ordinary Tutsis. Tens of thousands more Tutsis fled to Burundi and Uganda. Habyarimana dissolved parliament, banned MDR-P, and established the Mouvement révolutionaire national pour le développement (MRND). Civilian rule under one-party government was introduced in 1978, and a legislature called the Conseil national du développement (CND) was established in 1981. Power remained with Habyarimana and the MRND central committee.

The RPF invasion In September 1990 a group of 4,000 Uganda-based refugees, many of whom were members of the National Resistance Army (NRA) of the Ugandan president, Yoweri Museveni, invaded Rwanda. They called themselves the Rwandan Patriotic Front (RPF) and were led by Major-General Fred Rwigyema. Rwigyema was killed within a month in disputed circumstances, but the RPF fought on under Major-General Paul Kagame and seized control of large swathes of territory in Ruhengeri and Byumba prefectures. The RPF carried out extensive massacres in these areas, precipitating the flight of nearly 1m Hutus into government-held territory. In 1993 the RPF’s advance on Kigali, the capital, was halted by French military “advisers”, who were an important, although covert, part of France’s long-standing military co-operation with Rwanda.

In 1991 the Rwandan government bowed to donor pressure, particularly from France, and allowed the formation of other parties. Dozens sprang up, but the most significant was a revived MDR. In mid-1992 the MDR’s Dismas Nsengiyaremye became prime minister and chose a cabinet dominated by the

MRND but including members of MDR and three other parties. The composition of the CND, however, remained unchanged.

Peace talks in Arusha Mr Nsengiyaremye’s government negotiated with the RPF in Arusha, Tanzania, and a deal was reached in August 1993. It was agreed that a new transitional government would include RPF members in key portfolios, while the Rwandan military and the RPF would form a new national army in roughly equal portions. Opposition parties, as well as the RPF, pressed for the inclusion of measures designed to strip the president of most of his powers. The RPF also secured government agreement to the stationing of 600 RPF troops in Kigali. The UN deployed 2,500 troops to help implement the agreement, and France finally withdrew its soldiers in December 1993.

MRND resistance The Arusha accords were unacceptable to powerful MRND factions, which faced the loss of power and possible trials for crimes against humanity. Some MRND members formed the blatantly Hutu supremacist Coalition pour la défense de la république (CDR), which made much of the murder of Burundi’s first Hutu president, Melchior Ndadaye, in October 1993 (see Burundi: Historical background). Habyarimana lobbied hard for the CDR to be included in the planned new government, but this was rejected by all other parties. The CDR, some army officers and others who had remained in the MRND began to arm and train Hutu militias, particularly recruiting those displaced from Byumba and Ruhengeri by the RPF.

Throughout late 1993 and early 1994 Habyarimana skilfully orchestrated splits in the legal opposition parties, which delayed the implementation of the Arusha agreement as politicians on all sides squabbled over cabinet posts. However, by April 1994 international and domestic pressure had exhausted Habyarimana’s opportunities to delay proceedings.

The genocide and RPF On April 6th 1994, returning with the Burundian president, Cyprien takeover Ntaryamira, from a regional meeting, Habyarimana’s plane was shot down over Kigali. The identities of those responsible have still not been satisfactorily established. A rump MRND-dominated government quickly proclaimed itself, and initiated the elimination of political opponents and genocide of Tutsis the following day. The main killers were militias and the army, but thousands of civilians also participated after varying degrees of coercion and persuasion. The UN Security Council had been informed some months earlier of the government’s genocidal plans, but chose to represent the unfolding violence as chaotic tribal warfare. Rather than attempt to prevent the genocide, the UN withdrew all but 270 of its troops, and those remaining played almost no part in subsequent events.

The RPF renewed its offensive and took power in Kigali on July 19th. This stopped the genocide, but not before up to 1m people had been killed. The RPF advance precipitated a mass Hutu exodus, orchestrated by the Rwandan army and MRND government officials. In all, more than 2m people left Rwanda for Zaire, Tanzania and Burundi in 1994-95.

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The plight of refugees The refugees gathered in camps run by the office of the UN High Commissioner for Refugees (UNHCR) and international aid agencies. Tens of thousands died in a matter of weeks, with their plight broadcast live by the international media. Aid agencies slowly and painfully stabilised the situation, while old regime leaders established political control in the refugee camps, partly by supervising the distribution of food and shelter. These leaders prevented most refugees from returning home using intimidation and propaganda—their cause helped by Rwandan Patriotic Army (RPA) massacres, murders and arrests of many who did return. Militiamen among the refugees began to regroup militarily, and repeatedly raided Rwanda from Zaire and Tanzania. The RPA responded with a counterinsurgency, alienating many Hutus from the regime with its brutal reprisals for rebel attacks.

In late 1996 the Alliance des forces démocratiques pour la libération du Congo- Zaïre (AFDL) led by Laurent Kabila, and the RPA, broke up Zaire’s Rwandan refugee camps. Refugees initially scattered from the Rwandan border, but 1.2m returned voluntarily or were driven back between November 1996 and January 1997. The Tanzanian government also expelled 500,000 Rwandan refugees in January 1997. Militias in Zaire entered Rwanda during the mass return, evading the government’s screening process, and targeted Hutu “collaborators” with the Rwandan regime, military installations, genocide survivors and sometimes humanitarian workers, particularly in Ruhengeri and Gisenyi. In response, the RPA intensified its counterinsurgency, allegedly with the help of US military training.

The RPA’s role in Congo Mr Kabila took power in Zaire in May 1997, and changed the country’s name to the Democratic Republic of Congo (Congo, formerly Zaire). The RPA played a key role in his success and also, it appears, in the extensive massacres in eastern DRC of Rwandan and Burundian refugees, as well as Congolese citizens, in the first half of 1997. Rwandans initially dominated the Congolese government and armed forces command structure, but in 1998 Mr Kabila drastically curtailed their influence and began working with Rwandan Hutu militias still present in Congo. The RPA was ordered out of Congo, and the Ugandan army and Mulenge members of the Congolese armed forces (FAC) launched a major offensive against Mr Kabila’s government. The rebels formed a political organisation called the Rassemblement congolais pour la démocratie (RCD). The RCD and its allies’ bid to capture Kinshasa was thwarted by Zimbabwean and Angolan troops in late August, but they have since managed to take control of eastern Congo. The war has continued throughout 1999 despite numerous diplomatic attempts to end it, most recently the Lusaka talks in June-July 1999, which culminated in an agreement committing all regional states involved in the conflict to a ceasefire effective from July 12th 1999— although initial reports suggest that it has not been enforced. The agreement also commits the signatories to disarming the Rwandan militia that are fighting in Congo under the banner of Peuple en armes pour libérer le Rwanda (Palir), which should at least make it more difficult for Mr Kabila to co-operate militarily with them. Rwanda insists that its troops will remain until the security threat posed to the country by Hutu militia active in Congo can be contained.

Security in Rwanda The war in Congo ruptured the supply lines of the militia active in north-west improves in 1999 Rwanda, and security in this area has greatly improved during the course of 1999. Nonetheless, up to 500,000 people in the north-west were displaced by the fighting, but they were resettled between late 1998 and mid-1999 by the Rwandan government in purpose-built villages, despite considerable international unease over this development.

Genocide trials Genocide trials began in Rwanda in December 1996 but by mid-1999 about 1,250 people had been judged out of a total prison population of nearly 130,000. More than 230 people have been sentenced to death, but only 22 have actually been executed, before a huge crowd in Kigali on April 22nd 1998. The executions encouraged several thousand prisoners to plead guilty in the hope of being given reduced sentences, although fewer have taken advantage of this opportunity than the government had hoped. In October 1998, to the anger of genocide survivors’ associations, the government announced that prisoners without complete files against them would be released, and since then about 2,000 have been allowed to go free.

Meanwhile, the International Criminal Tribunal for Rwanda (ICTR), based in Arusha, has completed five trials. In each case the accused have been found guilty, and four of them have been given life sentences. The ICTR has about 50 genocide suspects in detention, all of whom are thought to have been among the most senior organisers of the genocide.

Western powers examine In December 1997 Belgium’s Senate published the findings of its commission their role during the of inquiry into events surrounding the deaths of ten Belgian soldiers in genocide Rwanda in 1994, which were highly critical of the role of the Belgian government and the UN Security Council both before and during the genocide. The French government rejected calls for an inquiry but instead in March 1998 it instituted an “information mission” into France’s role in Rwanda between 1990 and 1994. The mission released its report in December 1998. It was mild in its criticism of France’s role but forceful in its criticism of the role of Belgium, the US and the UN Security Council.

The US president, Bill Clinton, visited Rwanda in March 1998 and publicly apologised for not having done enough to stop the genocide. The US government has, however, refused to institute its own commission of inquiry into its role in Rwanda in 1994. In March 1999 the UN secretary-general, Kofi Annan, who was in charge of peacekeeping in 1994, agreed after considerable pressure to institute an inquiry into the UN’s role. The team conducting the inquiry, headed by the former Swedish prime minister Ingvar Carlsson, began work in June 1999 and hopes to present its report by the end of the year.

The government gives itself In June 1999, a month before the self-proclaimed five-year mandate of the another four years in office Rwandan government was due to expire, the government awarded itself another four years in office. The government has, however, instituted a democratic process for lower echelons of government, with elections at cellule and secteur levels taking place in March 1999. No political parties were allowed to contest the elections, and although voting was not strictly compulsory, Rwandans who chose not to vote were obliged by the authorities to have

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“good reasons” for doing so. Turnout was estimated at 85-90%, and the elections passed off smoothly, winning a favourable reaction from international donors.

Important recent events

September 1990: The Tutsi-dominated Rwandan Patriotic Front (RPF) invades Rwanda, marking the start of three years of conflict.

August 1993: Peace talks lead to the Arusha accords—a promise of transitional government with UN aid.

April 1994: The plane carrying the Hutu President, Juvénal Habyarimana, is shot down, and a rump government initiates genocide against the Tutsis. The UN withdraws its troops.

July 1994: The RPF renews its offensive and takes power, precipitating a mass exodus of Hutu refugees into camps, which leads to thousands of deaths.

November 1996: Alliance des forces démocratiques pour la libération du Congo-Zaïre (AFDL) troops begin to break up refugee camps in eastern Zaire, causing refugees and former war criminals to take flight.

December 1996: Genocide trials begin in Rwanda.

May 1997: The AFDL and Laurent Kabila take power in Zaire (now the Democratic Republic of Congo) with Rwandan assistance.

April 1998: The International Criminal Tribunal for Rwanda, based in Arusha, records its first guilty verdict. Mass genocide trials get under way in Rwanda.

August 1998: Rwandan soldiers and Mulenge militia launch a rebellion against Mr Kabila in Congo. The conflict goes on to drag in nearly every country in the region.

March 1999: Non-party local government elections are held throughout Rwanda at cellule and secteur levels.

June 1999: The Rwandan government extends its period in office to 2003.

Constitution and institutions

Rwanda’s government is in Rwanda’s constitution was adopted by the Assemblée nationale (parliament) in theory transitional May 1995 and draws on the 1991 constitution, which introduced multipartyism; the Arusha accords of 1993; and agreements made between political parties (excluding the MRND and CDR) in late 1994. The government has no electoral mandate and is officially transitional. In 1994 a general election was scheduled for 1999, but in June 1999, one month before the completion of its first five-year period in office, the government extended the transition period to 2003.

Elections are taking place Government policy is first to hold elections at the lowest levels of government at the lowest levels first and then to work upwards. Elections at the nyumba-kumi level took place in November-December 1998 and were followed in March 1999 by elections at the cellule and secteuri level. Elections for communes and prefectures still have to be held. So far, party political candidates and campaigning have been forbidden.

The president is strong, but The president can dismiss cabinet ministers at will and the prime minister the Ministry of Defence is subject to agreement from two-thirds of parliament. Political parties put stronger forward candidates for vacant cabinet posts, which the president can then reject or accept. Parliament can force ministerial resignations, although the president wants this power overturned. Decisions properly belonging to the president—such as whether or not to wage war against neighbouring states— often seem to emanate instead from the Ministry of Defence, headed by Mr Kagame.

The parliament needs a The parliament has on occasion been willing to challenge government mandate legislation. But the delegates’ lack of a popular mandate has resulted in some disturbing developments, such as the obscurely appointed parliamentary disciplinary committee, which arbitrarily expels fellow assembly members. In June 1999 the assembly president, Joseph Sebarenzi, called for legislation to define and limit the committee’s powers and responsibilities.

The justice ministry lacks The judiciary is appointed by the government but is constitutionally political clout independent. The Constitutional Court’s rulings on the constitution are binding on the executive and the legislature. Since 1994 the justice minister in government has had no party political affiliation. An unfortunate effect of this has been that justice ministers have lacked a supportive political constituency when embroiled in controversy, which has led to a high turnover in the post. The current minister, Jean de Dieu Mucyo, unlike his predecessors, is Tutsi and a genocide survivor.

Traditional courts are Genocide trial judges were hurriedly trained and the quality of their initial revived for genocide cases work was poor, but improved markedly in 1999. Defence lawyers are supplied by international human rights and legal organisations, but not everyone has access to them. To ease the backlog in genocide cases, the government is reviving the traditional gacaca courts, with their rulings subject to appeal.

Political forces

The RPF’s agenda The RPF controls the presidency, the vice-presidency, and the key government portfolios of interior and defence. Founded and still run by former refugees from Uganda who fought and defeated the former government, the RPF is predominantly English-speaking and Tutsi, with liberal economic policies that reflect its Ugandan heritage. The RPF says that it is free of ethnic bias, and its intellectual wing argues that Hutus and Tutsis were once social classes whose differences were ethnicised by Belgian colonisers. The RPF has awarded Hutus more top posts, including the presidency, than was necessary in an attempt to

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reassure Western observers, but has tended to be happier with Hutu lightweights than with dynamic heavyweights, such as Seth Sendashonga and Alexis Kanyarengwe, both of whom were successively removed from the important interior ministry. Mr Sendashonga subsequently went into exile in Kenya, where he was assassinated in May 1998.

Party political divisions in the Assemblée nationale

Party No. of deputies Rwandan Patriotic Front (RPF) 13 Mouvement démocratique républicain (MDR) 13 Parti social démocrate (PSD) 13 Parti libéral (PL) 13 Parti chrétien démocrate (PCD) 6 Others 6 Armed forces 6 Total 70 Source: Inter-Parliamentary Union.

The RPF says that it believes in democracy, but would most likely lose a free and fair election because Rwandans would probably vote along ethnic lines, favouring predominantly Hutu parties such as the MDR. Unsurprisingly, therefore, the government has suspended party political activity indefinitely, citing reasons of security and “national unity”.

While RPF ministers want to sell off state assets, RPF deputies in parliament have slowed privatisation. The party is not committed to press freedom, and the harassment and detention of critical journalists is commonplace. Having fought French troops for three years, the RPF is hostile to France, although in its higher echelons this hostility is tempered by realpolitik.

Partners in government The MDR, independent Rwanda’s first ruling party, was the RPF’s major partner in government until a reshuffle in February 1999 left it with just two cabinet posts. Reborn in 1991, the party has retained Hutu support and its Gitarama powerbase, which will be useful in the event of a general election, but has discarded its former policy of Hutu supremacism for a more inclusive but vague agenda. The Parti social démocrate (PSD) was the major beneficiary of the February 1999 reshuffle and now has an impressive seven cabinet posts, but is a newcomer that was only formed with the advent of multipartyism in 1991, and commands no obvious electoral constituency.

Party political divisions in the government

Party No. of ministries (incl presidency) Rwandan Patriotic Front (RPF) 8 Mouvement démocratique républicain (MDR) 2 Parti social démocrate (PSD) 7 Parti libéral (PL) 1 Rwandan Democratic Congress (RDC) 1 Independents 4 Source: EIU.

Main political figures

President Pasteur Bizimungu: A Hutu Rwandan Patriotic Front (RPF) member from the north-west. Although he does not exercise unfettered executive power and simply endorses rather than formulates government policy in key areas, Mr Bizimungu is less of a puppet than most commentators suggest. A careful political operator who expresses particular outrage at the Rwandan Catholic Church’s post-genocide stance, Mr Bizimungu publicly implicated Bishop Augustin Misago of Gikongoro in the genocide at a ceremony marking its fifth anniversary in 1999. Mr Misago was subsequently arrested and is awaiting trial for genocide crimes, despite the protestations of the Vatican.

Paul Kagame: Vice-president, minister of defence and chairman of the RPF, Mr Kagame has greater prominence in Rwanda’s regional and international diplomacy and internal affairs than any other politician—the president included. Mr Kagame has directed Rwanda’s essentially military regional foreign policy since 1994, unafraid to deploy the RPA deep into Congo regardless of armed opposition in his bid to destroy Palir. Mr Kagame’s astute understanding of media control has resulted in less negative international coverage than might be expected. Mr Kagame’s relative success in containing the threat posed by Palir to Rwanda’s security has entrenched his political position, in spite of recent rumours of discontent from within the upper echelons of the RPF.

Pierre-Célestin Rwigyema: Prime minister since August 1995, Mr Rwigyema belongs to the Mouvement démocratique républicain (MDR), and has spearheaded the party’s attempts to rid itself of those identified with genocide and Hutu ethnic supremacism. In July 1998 Mr Rwigyema engineered the expulsion from the MDR of party president Bonaventure Ubarijoro, who was director of the secret police under President Gregoire Kayibanda, and in March 1999 backed the expulsion of three MDR deputees from the assembly. They in turn accused Mr Rwigyema of genocide and, despite his denials, prosecutors are examining his case with a view to a prosecution.

Donald Kaberuka: Finance minister since October 1997. Suave and articulate, Mr Kaberuka conveys the ideal image for his position—economically both literate and liberal, and primarily concerned with uplifting Rwanda’s poor. Having earned the RPF’s trust with his handling of the economy and donors, Mr Kaberuka has received the necessary political backing to pursue privatisation and other uncomfortable economic reforms. Donors like and seem to trust Mr Kaberuka, and aid to Rwanda has kept flowing in spite of the war in Congo, although this is in part because the RPA has managed to keep its war costs out of the official national accounts.

The politics of Rwanda’s The Rwandan Patriotic Army (RPA) is RPF-aligned and politically powerful. The armed forces RPA consists mostly of RPF soldiers, although many former Rwandan army soldiers have joined as well. Most Rwandan militia group themselves under the mantle of the Peuple en armes pour libérer le Rwanda (Palir). The government rejects Palir’s demands for negotiations, branding the party’s leaders as war and genocide criminals. Most of the international community agrees, although Palir has been supported since August 1998 by Mr Kabila, and has apparently been fighting in Congo under Zimbabwean army command. The recent Lusaka peace agreement, which followed talks in June-July 1999, stipulates that all the

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armed forces active in Congo, including those that have been fighting alongside Palir, are to work together in a joint military committee to disarm Palir and hand over its senior members to the ICTR in Arusha.

International relations and defence

The region Troops from Uganda, Rwanda and Angola installed Laurent Kabila as president of Congo in 1997, but when Uganda and Rwanda turned against Mr Kabila in August 1998, Angola defended him. Uganda and Rwanda have maintained their military alliance in Congo, despite the disapproval of the Organisation of African Unity (OAU) and military intervention in Mr Kabila’s defence from Angola, Zimbabwe, Namibia, Chad and perhaps Sudan. During 1999 tensions have increased in Congo between Rwandan and Ugandan troops both over which Congolese rebel coalition to support and over which country will secure Congolese business opportunities and assets. These tensions have harmed political relations, but there are no obvious rifts at the highest level. Most Rwandan imports and exports go through Uganda.

Rwanda and Burundi are both fighting the predominantly Hutu militias that operate against them inside their own territories and in Congo. Rwanda and Burundi are regional rivals, despite this common strategic interest and compete for investment and trade; while Burundi was under sanctions, which were supported by Rwanda, in 1996-99, the South African cell phone company MTN and others moved their regional operations to Kigali.

Tanzania’s relations with Rwanda improved once Dar es Salaam expelled almost 500,000 refugees in early 1997, but there have been occasional allegations from Rwanda since then of covert Tanzanian support for Palir units operating from Tanzania. These are denied by the Tanzanian government.

Rwanda has been trying since August 1998 to topple Mr Kabila, having installed him as president of Congo two years earlier, because it judges not only that Mr Kabila cannot contain Rwandan militia operating from Congo, but also that he has been reverting to Mobutu Sese Seko’s strategy of deploying them instead as an alternative to the notoriously disorganised Congolese armed forces (FAC). A daring Rwandan military manoeuvre to capture Congo’s capital, Kinshasa, in August 1998 was thwarted by Zimbabwean troops. Although Rwandan-backed rebel forces have captured nearly half of Congo, there are serious conflicts between the rebel factions, weakening their capacity to capture much more. The 1999 Lusaka ceasefire agreement (see Historical background) has paved the way for the RPA to continue its fight against the Rwandan militia fighting in Congo.

Kenya was a refuge in 1994-96 for prominent members of the former regime, and was hostile towards Rwanda. Since the fall of Mobutu in Zaire many of them have been arrested and transferred to the international genocide tribunal in Arusha, and relations between Kenya and Rwanda have improved, partly because the Kenyan president, Daniel arap Moi, fears regional isolation. Mombasa is the main port for Rwanda’s imports and exports.

Angola and Rwanda were allies in Congo in 1996 and 1997 along with Uganda. With three of the most effective armies in Africa, the alliance looked formidable, but fell apart in August 1998 in Congo. Rwanda believed it had secured Angola’s prior tacit agreement that Mr Kabila could fall but had misjudged Angolan political decision-making, wrongly believing that certain generals could always be relied on to speak for the Angolan government. Still, Rwanda and Angola have done their best to keep their troops from actually fighting one another in Congo, and rapprochement is likely once a lull can be secured in the Congolese conflict.

The international Despite widespread concerns about Rwanda’s human rights record, in community particular its massacres of Rwandan refugees in eastern Congo in 1997, and its role in the current Congolese conflict, Rwanda enjoys the support, particularly in the form of economic assistance, of the international community, which feels guilty about its role during the genocide. The US is Rwanda’s main international ally, providing military and economic aid, and the UK is also an important backer. France was Rwanda’s main Western supporter during Habyarimana’s rule and, although still a significant donor, is viewed by the current Rwandan government with intense suspicion. Belgium, the former colonial power, is supportive of the Rwandan government, although it remains critical. Most exiled opposition groups are based in Brussels. Rwanda has warm relations with South Africa, which supplies military equipment and diplomatic support where necessary.

The Rwandan government blames the UN for what happened in 1994, and remains mistrustful of it. The ongoing inquiry into the UN’s role between 1990 and 1994 will improve relations if its findings are critical, but will be dismissed by Rwanda as useless if it reaches any other conclusion.

Arms supplies and military Rwanda has bought arms from South Africa directly, but acquires most of its training military hardware via Uganda from a variety of countries. This has presented quality control problems, and in 1999 the RPA acquired helicopters which turned out to be defective from a Ugandan intermediary. South Africa, the UK and the US are thought to be providing military or police training. Rwandan militias and the former Rwandan army are acquiring new weaponry in Congo, often of east European origin, and are regrouping with the assistance of Mr Kabila and his allies, particularly Zimbabwe.

Military forces, mid-1998

RPA 30,000-40,000 Paramilitary Gendarmerie 7,000 Total 37,000-47,000 Source: International Institute for Strategic Studies, The Military Balance.

Defence The RPA had an estimated 55,000 troops in 1998, although it says that since then it has demobilised 10,000 soldiers. The RPA consists mostly of RPF troops with a few thousand integrated from the former Rwandan army (ex-Forces armées rwandaises; FAR). The RPA is actively engaged deep into DRC territory against Palir and the FAC. The RPA is also fighting a low-level civil war against

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Palir in north-west Rwanda, although this conflict has diminished since fighting intensified in Congo.

Resources

Population

1997 Total (m) 7.80 Sources: UN Department for Economic and Social Information and Policy Analysis; EIU.

Demographic In 1994 up to 1m of the country’s estimated 7.6m inhabitants were killed and transformation another 2m left as refugees. Since then, there have been further epic population movements. Up to 200,000 refugees have perished in exile although most of the rest have returned, as have 700,000 “old” refugees from Uganda and Burundi who left Rwanda between 1959 and 1973. Some 220,000 children are orphans who have either joined, or are seeking to join, other families (see Reference table 1 for a UN population series). At least 120,000 people are in prison on suspicion of genocide. With the mass killings over, Rwanda’s population will rise by at least 200,000 per year over the next five years.

Before the genocide, convention had it that 85% of Rwandans were Hutu, 14% Tutsi and less than 1% Twa, although this probably underestimated the size of the Tutsi community. It is now harder than ever to establish Rwanda’s ethnic make-up, in part because the government has forbidden ethnic monitoring and has removed the mention of ethnicity from Rwandans’ identity documents. However, Hutus still outnumber Tutsis by at least 4:1. The Twa community, estimated at 30,000 in 1993, is now believed to number less than 15,000.

The capital, Kigali, is more Tutsi than ever before and more populous, with 358,000 residents in 1996 compared with just 83,000 in 1991. Nonetheless, only 8% of Rwanda’s population is thought to live in towns. Population density is the highest in Africa and has risen from 183 per sq km in 1981 to over 300 in 1998; the average Rwandan family has over six children.

Approximately 50% of Rwandans are aged 15 or younger (see Reference table 2 for historical figures of population by age). Life expectancy is 48.5 years, down from 53.7 in 1991. Some 70% of the population lives below the poverty line. About one-third of households are headed by women, many of whom are widows. (See Reference table 3 for a breakdown of the labour force.)

Health

Rwanda’s health infrastructure has been rebuilt since 1994, but regaining former levels of health cover is proving difficult. Infant mortality rates are high, averaging 119 per 1,000. Although this represents an improvement compared with the 1990-95 average of 139 per 1,000, it is still the worst in Africa. According to government figures, there are 34 hospitals, 323 health centres, and an average of one doctor per 58,000 people, although ratios are much higher in rural areas than in urban areas. Around 60% of health workers left the health service in 1994 and not all of them have been replaced, partly because the health sector is a major target of the government’s civil service reduction programme. The health budget in 1999 was $11m, and donors have pledged to spend $100m on the sector between 1999 and 2001. Most healthcare is provided through state and church institutions, but there is one expensive private hospital, the King Faycal in Kigali. Very few Rwandans have health insurance, but a medical scheme is being developed for civil servants.

About 12% of the population is HIV-positive and at least 600,000 people have AIDS. This figure is expected to double by 2001. More than 18% of those aged 45-49 are infected, and a Red Cross survey in 1999 of 25-44 year olds in Kigali found that one-third were seropositive. There are more than 100,000 AIDS orphans. The latest anti-AIDS strategy, the Great Lakes Initiative against AIDS (GLIA)—launched in April 1999—has its head office in Kigali, and is targeting stopping points on the region’s main transport routes.

Coping with trauma The Ministry of Health says that psychiatric illnesses increased greatly after the genocide, and has established a national trauma unit in Kigali which has developed an outreach programme to respond to the problem. Aid agencies are trying as well: the UN has been training teachers and health workers, and other agencies also have small programmes in place.

Education

Bilingual teaching Primary school attendance in Rwanda is estimated at around 70% and has remained roughly at this level for about 30 years, dipping considerably in 1994-96. Still largely excluded from the system are the 300,000 children living in child-headed households, owing to the murder or disappearance of their parents or other responsible adults. The government aims to make primary school education universal and free by 2005, and has received considerable donor assistance towards this goal. Before the war, school teaching in Rwanda started in Kinyarwanda, continuing in French at higher levels. English has since been added and education is theoretically bilingual, although in practice this depends on teacher availability.

Primary and secondary schools were badly affected by the war, but teacher levels have recovered, and hundreds of schools have been renovated and are functional once more. The University of Rwanda’s Butare campus reopened in April 1995, but the Ruhengeri campus has remained closed.

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Natural resources and the environment

Most of Rwanda is hilly and lush; the hills become more mountainous in the north-west towards the Virunga mountains. The country is located just south of the equator and enjoys typically tropical weather. The rainy season lasts from mid-October to early December, and the main harvest follows in January. It is generally dry until minor rains in March and April, followed by the next harvest in July and August. Most planting is done in September and October, in time for the main rains.

About 75% of the land is suitable for agricultural use. Most suitable farmland has long been under cultivation, although the Ministry of Agriculture estimated in 1997 that only 85% of the land cultivated in 1990 was in use.

Transport and communications

Transport Nearly all Rwanda’s imports and exports travel over 1,500 km to Mombasa (Kenya) and Dar es Salaam (Tanzania), via the region’s road network. This keeps transport costs high, particularly since new weight limits for freight travelling through East Africa were imposed in 1998 and 1999. The Rwandan government has urged transporters to use rail instead, but Rwanda currently has no rail network and there are no regional rail links to the Rwandan border. The nearest rail heads are at Kasese in Uganda and the Lake Tanganyika port of Kigoma in Tanzania. In June 1999 the government announced plans to build a railway between Isaka and Kigali, but the project will require donor funding.

Rwanda’s arterial roads are serviceable and better than their Ugandan and Tanzanian counterparts, but unimpressive compared with Burundi’s. Rwanda has about 1,200 km of tarred roads and another 12,000 km of unpaved main and secondary roads, which are vulnerable to damage from heavy rain. In 1992 there were 27,441 registered vehicles in Rwanda. After years of state control, commercial transport is now largely in private hands. STIR, the transport parastatal, is due to be privatised.

Alliance Air Rwanda Air Rwanda, Rwanda’s state airline, was renamed Alliance Air Rwanda and restructured in 1998. The new company is 51% owned by the Rwandan government, with the remainder controlled by South African Airways (SAA) and Alliance Air, which is jointly owned by the Ugandan and Tanzanian governments. It runs regular, comfortable but expensive flights to Kampala and Johannesburg. Rwanda Airlines, a private company with one BAC 78-seater jet, was launched in January 1998.

Telecommunications Before the war there were 12,600 telephone lines in Rwanda, over 90% of which were in Kigali. The telecommunications parastatal, Rwandatel, is perennially short of money and staff and the government says it wants to privatise it, although nothing has happened yet. Rwandacel, Rwanda’s first private telecommunications company, was launched in 1998 and is the national Internet service provider. The South African cell phone company MTN

established a network in 1998 which quickly gained more than 3,000 subscribers.

Mass media Radio is Rwanda’s main communications medium. Radio Rwanda is state- owned, government controlled and does not broadcast items critical of government. Radio Burundi can be picked up on FM in Rwanda and is popular, partly because it plays better music, and the BBC’s Kinyarwanda service attracts a keen listenership. Genocide trials in Arusha are being covered by the independent Radio Hirondelle.

The printed press is largely confined to Kigali, and is hampered by the high cost of paper and print and the poverty of its intended readership. Titles include the semi-official English-language paper, New Times, and L’Arc-en-ciel, which is published by returnees from Burundi. Critical journalists from all publications are regularly harassed and detained by the authorities.

Energy provision

More than 90% of energy consumed in Rwanda comes from wood, peat and charcoal. Electricity accounts for about 1%, and petrol products make up the rest. Rwanda produced 110m kwh of electricity in 1997 and imported a further 73.2m kwh. (See Reference table 4 for historical national energy statistics.) Rwanda’s electricity is the most expensive in the region. Consumption reached pre-war levels in 1998, with Kigali accounting for about two-thirds of the total. Fewer than 2% of households nationally have electricity.

Imports of ordinary vehicle and diesel fuel in 1997 were lower than import levels in the late 1980s, but were higher than at any other time since 1994. Rwanda spent Rwafr8.9bn ($29.5m) importing fuel in 1997, 9% of its total import bill. Taxes on fuel were increased in the 1999 budget from 25% to 60%, but had little impact on pump prices because of falling international oil prices. PetroRwanda, Rwanda’s fuel parastatal, sold its filling stations to Shell Uganda for $50m in December 1998, while South Africa’s Engen bought BP-Fina’s Rwandan (and Burundian) assets earlier in the year.

Energy balance, 1998 (m tonnes oil equivalent)

Elec- Oil Gas Coal tricity Othera Total Primary production 0.00 0.00 0.00 0.04b 1.28 1.32 Imports 0.18 0.00 0.00 0.00 0.00 0.18 Exports 0.00 0.00 0.00 0.00 0.00 0.00 Primary supply 0.18 0.00 0.00 0.04b 1.28 1.50 Net transformation 0.00 0.00 0.00 –0.03 0.00 –0.03 Final consumption 0.18 0.00 0.00 0.01c 1.28 1.47

a Predominantly peat, wood and charcoal. b Input basis. c Output basis.

Source: Energy Data Associates.

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The government announced its intention to privatise the electricity parastatal, Electrogaz, in February 1996 but waited until May 1999 before removing the company’s distribution monopoly. Electrogaz’s assets will remain in state hands, and the government intends to retain the power to set the price of electricity to the consumer and influence investment decisions.

Lake Kivu contains some 55bn cu metres of natural methane gas reserves, according to a 1998 study. A small factory was established to exploit the resource in 1963 which extracts 5,000 cu metres a day, with Bralirwa’s Gisenyi brewery the main customer. Bralirwa and Electrogaz announced plans in 1999 to spend $1.25m on expanding capacity, but more substantial investment will have to await the cessation of hostilities with the Democratic Republic of Congo (Congo, formerly Zaire), whose border with Rwanda runs through the lake.

The economy

Economic structure

Main economic indicators, 1998a

Real GDP growth (%) 10.5 Consumer price inflation (av; %) 10.0 Population (m) 8.08 Current-account balance ($ m) –120.0 Total external debt ($ m) 1,200 Exchange rate (Rwfr:$; av) 312.3b

a EIU estimates. b Actual.

Source: EIU.

Mainly subsistence farming Most Rwandans are subsistence farmers, and food crops contributed about 32% of GDP in 1997. Tea and coffee are Rwanda’s main cash crops and, while accounting for under 3% of GDP, usually generate 90% of the country’s export earnings. Rwanda’s manufacturing sector is small, weak and regionally uncompetitive, and generated 15% of GDP in 1997. Manufacturing is centred on agricultural processing, and the brewing company Bralirwa is Rwanda’s largest manufacturer. Commerce and tourism dominate Rwanda’s tertiary sector, which generated 34% of GDP in 1997.

Manufacturing and services are concentrated in the capital, Kigali. Coffee is produced nationwide but plans are under way to concentrate production in areas in which the crop grows best. Tea is produced in large estates, most of which are in the north and west of the country. The north west is traditionally the most productive part of Rwanda for food crops, but has been badly affected by insecurity since 1996.

Negative savings Private consumption has accounted for more than 100% of GDP throughout the 1990s, with public consumption averaging around 12%. Gross fixed investment has averaged at about 12% as well, with over 95% supplied by donors. Gross domestic savings are negative, and reached a new low of –14.6% in 1997.

Comparative economic indicators, 1998

Rwanda Ugandaa Tanzania South Africa UK GDP ($ bn) 2.1b 6.8b 8.3ab 117.7 1,387.0 GDP per head ($) 258b 322b 256ab 2,791 23,465 Consumer price inflation (av; %) 10.0 0.0b 12.8 7.0 2.6 Current-account balance ($ m) –120b –376b –563 –2,440 2,480 Merchandise exports fob ($ bn) 0.1 0.5b 1.0 28.0 271.1 Merchandise imports fob ($ bn) 0.2 1.2b 1.5 27.1 271.1 a Fiscal year starting July 1st. b EIU estimate.

Source: EIU CountryData.

Economic policy

Reconstruction has been The economic priority for the government since 1994 has been to repair the the top priority massive damage caused by the war which culminated in the orgy of destruction that surrounded the 1994 genocide. The government sought to enable humanitarian agencies, particularly the UN Food and Agriculture Organisation, to revitalise subsistence agricultural production by providing seeds and agricultural implements, while it concentrated on securing the return of refugees, most of whom were subsistence farmers, from what was then Zaire (now the Democratic Republic of Congo). Subsistence agricultural production in the north-west was badly affected by the insecurity that raged in the area from 1996 to 1998, but the government’s decision to take the war against Palir into Congo has succeeded in restoring a measure of peace, and production is on the increase once more.

The government relied on donor assistance to revive and repair the physical assets of Rwandan commercial agriculture, and the EU has provided generous help to the sector, while the government has concentrated on liberalising the sector, reducing export taxes and improving payments to producers in an effort to boost production. The strategy has been only partly successful; although tea production has recovered, coffee production is less than half of what it was in 1990.

Rwanda’s manufacturing sector attracted little post-war aid from donors and output today is lower than before the war. The government compounded the sector’s difficulties by reducing tariff production, particularly in 1998 and 1999, arguing that manufacturers employ too few people and cost the state too much (in the form of subsidies to parastatals) to merit kinder treatment.

Rwanda’s tourism industry is based around the gorillas of the Virunga mountains, but these mountains are also home to Palir units, making the

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revival of tourism difficult, particularly since the murder of tourists by Palir in Uganda near the Rwandan border in February 1999. Nonetheless, the Virunga park reopened in June 1999, having been closed for three years.

Diversifying the export Rwanda’s tea and coffee exports are sufficient to cover only one-quarter of the base country’s import bill, so increasing export earnings and diversifying the export base is a priority. The government has tried to boost export earnings from tea and coffee by increasing both crop volumes and quality, and to diversify the export base by offering tax and other incentives to non traditional exporters from the private sector. The take-up has been slow, but a private company is now exporting flowers to Europe and South Africa. The government has also identified hydroelectricity as a potential future export and has begun co- operating with Uganda to realise this, in the hope that exports can begin in 2002.

Attracting foreign Rwanda has never attracted much foreign investment and to redress this, the investment government is trying to market the country as strategically located for regional investments, politically secure and economically liberal in its outlook. In order to entice investors, the government has established an investment centre, instituted a far-reaching privatisation programme that extends from banks to commercial agricultural assets, and has put in place tax incentives for investors in non-traditional exports, and generous profit repatriation measures. The privatisation programme has been running since August 1996 and has secured the sale of 20 state assets, with another five nearly sold and four liquidated. (See Reference table 5 for historical data on government finances.)

Economic liberalism As part of its economically liberal approach, the government has allowed the Rwandan franc to float freely, and worked hard to contain the inflation rate. The government has used primarily fiscal measures, particularly the strict control of government expenditure. Despite government claims to the contrary, monetary policy has been more lax, and the Banque national du Rwanda (the central bank) has allowed considerable growth in domestic credit since 1996. However, according to IMF figures, the money supply, once seasonally adjusted, has actually been falling since 1997 (Reference table 6 shows historical money supply figures).

Boosting revenue The government has adopted a variety of measures to control government expenditure, including the appointment of an auditor-general, the establishment of a central tender board and a move towards cash budgeting. Because the Rwandan Patriotic Army (RPA) has been able to self-finance the war in Congo, the conflict has not generated significant increases in government expenditure. State revenue has been boosted by the establishment of a semi-autonomous collection agency, the Rwanda Revenue Authority (RRA), which has wide-ranging powers.

Reducing debt Keen to reduce the national debt, the government hopes Rwanda will qualify for debt relief under the World Bank/IMF heavily indebted poor countries (HIPC) initiative by strict adherence to the conditions placed on it by the Fund’s enhanced structural adjustment process, which it joined in June 1998.

Economic integration with To enhance economic integration with the East African region, Rwanda has East Africa applied for membership of the East African Community (EAC), and is likely to join by 2000. Rwanda has sought to develop increased trading ties with South Africa, and South African companies have been among those most interested in Rwanda’s privatisation programme. Meanwhile, Congo is apparently viewed by the government as a conveniently located and well-endowed source of plunder.

The 1999 budget The 1999 budget pledged to keep real GDP growth above 7%, reduce inflation to below 5%, achieve a (donor assisted) budget surplus, and raise tax revenue from 10% of GDP to 11.7%. The finance minister, Mr Kaberuka, also promised to speed up the privatisation programme, increase expenditure on poverty reduction and improve civil service pay. In order to finance the forecast Rwfr14bn ($4.4m) current deficit, Mr Kaberuka hiked excise duties on alcohol, soft drinks, cigarettes and fuel.

Financial operations of the central government, 1998

(Rwfr bn)

Fiscal receipts 63.452 Non-fiscal receipts 2.031 Total revenue 65.483 Current expenditure 79.127 Capital expenditure (domestic financed) 3.035 Capital expenditure (externally financed) 39.747 Total expenditure –121.909 Balance –56.425 Financing 56.425 loans 18.828 grants 30.237 domestic financing 7.360 Source: Ministry of Finance.

Economic performance

Agricultural recovery The war and genocide of 1994 halved Rwandan GDP, but even before then, underpins economic revival average growth rates throughout the early 1990s were negative. Since 1994 Rwanda has experienced a high GDP growth rate, reflecting the economy’s gradual but sustained recovery, but only in 1998 did it attain its 1993 level in real terms. Post-war GDP growth has been based on the successful revival of Rwanda’s subsistence agricultural sector, although Rwanda has yet to regain its pre-war self-sufficiency in food. In the secondary sector, electricity production since 1997 has exceeded levels reached in the early 1990s as power stations put out of action by the Rwandan Patriotic Front (RPF) in that period have been recommissioned. Industrial production reached 1993 levels in 1998, while figures for construction show activity to be still lower than before the war, despite the rebuilding that has taken place in many of the urban areas devastated in 1994. In the tertiary sector, commercial activity and tourism

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remain depressed, because of Rwandans’ diminished purchasing power and because tourists continue to perceive Rwanda as too risky to visit. (See Reference table 7 for GDP growth in 1994-98.)

Gross domestic product (% real change)

Annual 1998 average 1994-98 GDP 10.5 2.18 Source: EIU estimates.

Gross fixed investment has Gross investment is far lower today in real terms than before the war. declined According to government figures, gross investment in 1997 was worth 59% of the 1993 figure, at constant 1995 prices. Before the war, the private and public sectors provided roughly equal levels of fixed investment, but in 1997, public investment accounted for 82% of the total. Over 90% of publicly funded fixed investment is financed by foreign inflows.

Inflation

(% change; annual average)

Annual 1998 average 1994-98 Consumer prices 10.0 22.5 Source: EIU estimates.

Inflation has come down— The government has a good track record on inflation, particularly since 1996, when the rate came down to 9%, at which level it has roughly remained since then. The inflation rate is vulnerable to fluctuations in agricultural production; in December 1997, for example, inflation increased to 17% year on year because of the impact of increased Palir insurgency on food production in the north-west.

Urban prices, Jun 1999

Unit Price (Rwfr) $ Beer (Primus) 1 bottle 300 0.90 Coca-Cola 1 bottle 120 0.36 Soap (Lux) 1 bar 300 0.90 Oil (palm) 1 litre 450-500 1.34-1.50 Sugar 1 kg 300-350 0.90-1.05 Tomato 1 tin 100 0.30 Rice 1 kg 250-350 0.75-1.05 Chicken 1 live animal 2,000-2,500 5.98-7.46 Kerosene 1 litre 180-200 0.54-0.60 Newspaper 1 issue 200-300 0.60-0.90 Cigarettes 1 pack (20 items) 300 0.90 Source: EIU.

Food price inflation has tracked the overall inflation rate fairly accurately in recent years, although with cereal price increases usually lower and dairy product increases usually higher than the mean. Increases in the cost of clothing, education, health products and entertainment have been lower than the inflation rate since 1996, but the cost of water, electricity, transport and communications have been much higher.

—but still exceeds salary Most Rwandans are unsalaried subsistence farmers. The minimum wage in increases Rwanda remained unchanged between 1980 and 1995. The rate increased by 20% in 1996, from Rwfr2,000 per month to Rwfr3,000, and has since remained unchanged. Salaries for skilled employees have remained unchanged as well, and as a result purchasing power for salaried workers is on the decline. (See Reference table 7-9 for historical GDP data and Reference table 10 for consumer prices figures.)

Regional trends

Rwanda is a small country with a relatively uniform, tropical climate. However, the northern provinces are at a higher altitude than those in the south and are colder at night, making them more suitable for tea and coffee cultivation.

Ruhengeri and Gisenyi in the north-west are traditionally Rwanda’s main food producing areas, but have suffered from violence and insecurity which has harmed production. The capital, Kigali, is larger and more developed than other Rwandan towns and is the home to 94% of Rwanda’s banks, 96% of its industry, 65% of the civil service, 80% of the informal sector and 90% of the hotel space. The city also has the most reliable supplies of water, electricity and telephone lines.

Rwandan government is centralised and hierarchical. The country is divided into prefectures, with each prefecture divided into communes. Communes are divided into secteurs, and these into cellules, with the final subdivision being the nyumbakumi, which comprises only ten households. Local government officials wield immense power, particularly at communal and prefectural level, and are appointed by central government.

Economic sectors

Agriculture, forestry and fishing

Subsistence agriculture About 90% of the Rwandan population work on the land, and adequately sized plots are in chronically short supply. Many people own their fields, more than half of which are smaller than 1 ha. Farming conditions can be difficult; some plots are on slopes so steep that farmers have to tie themselves to posts to cultivate them without falling over. The land is overworked and soil exhaustion has been a problem for nearly 100 years. The main crops are plantain, sweet bananas, sweet potato, Irish potato, cassava, beans, sorghum,

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and maize. Together, plantains and sweet bananas make up 60% of the total crop, and sweet potatoes account for another 20%. (See Reference table 11 for food production figures for 1993-97.)

Agricultural production collapsed in 1994, and only started to recover in 1996. Overall production in 1998 was at 90% of pre-war levels. Bananas were the only crop to exceed pre-war levels, and while production of most others neared pre-war levels, the figure was only 60% for cereals. Poor rains have harmed prospects for the 1999 harvests. Rwanda has yet to attain food self-sufficiency again, and the UN World Food Programme is providing food rations for tens of thousands of people in the north-west prefectures of Ruhengeri and Gisenyi (because of the fighting), and the south-eastern prefecture of Kibungo (because of drought). (See Reference table 12 for agricultural production for export figures.)

Coffee Arabica coffee is Rwanda’s main export crop. Quality is traditionally high but has declined since 1993 because of war-induced neglect of the crop, and a lack of pesticides and other inputs. Around 700,000 farmers grow coffee, but if the government succeeds in concentrating coffee production in optimal areas, numbers will fall to around 560,000. The coffee harvest starts in May and continues until December, with the crop year running from April to March. Yields are 700kg/ha, but if new varieties of bush are planted, could increase to 2.5 tonnes/ha.

Before the war production for export neared 40,000 tonnes, but slumped to 1,800 tonnes in 1994/95. Production recovered somewhat in 1995/96 but then fell back, reaching only 13,000 tonnes in 1998/99. This is because coffee trees are old and need replacing, and because of bad weather, fighting in north- western coffee-producing areas, and smuggling to Uganda, where prices are better for producers. This is partly because there is no coffee export tax in Uganda, and until 1999 when the tax was abolished, there was a 16% levy in Rwanda.

The government is liberalising the coffee sector. The parastatal Ocir no longer buys and sells coffee, but still distributes inputs (though not for much longer), controls quality, and broadcasts on the radio what buyers ought to pay producers, based on what buyers receive for the crop at washing stations.

Rwanda produces under 1% of the world’s coffee supply—below the threshold at which the coffee producers’ quotas begin—enabling it to benefit from high prices without having to reduce exports. In 1999/2000 there will be a bumper global coffee harvest, which will harm Rwanda’s export earnings from the crop this season.

Tea Rwandan tea is of exceptional quality and consistently fetches high prices at international markets. Production reached 13,200 tonnes in 1998, just 400 tonnes short of the pre-war record. Yields are 1.4 tonnes/ha, compared with 3.5 tonnes/ha in Kenya, mainly because of a lack of inputs. Officials believe that with better input supplies, yields could reach Kenyan levels, causing output to nearly treble. All Rwanda’s nine tea estates are due for privatisation, with the bulk of the sales expected in 1999 and 2000.

Livestock Livestock numbers fell drastically between 1990 and 1994. Since then cattle herds have recovered, mainly because of the influx of cattle accompanying Tutsis returning from exile in Uganda, and numbers now far exceed pre-war levels. Pig stocks are roughly the same as in 1990, but there are far fewer sheep and goats than before. Poultry numbers are steadily increasing, and will reach 1990 levels in the course of 1999.

Forestry The UN Food and Agriculture Organisation (FAO) estimates that 9% of total land in Rwanda is forested. Wood is the main fuel source for most people, but there is hardly any commercial timber production. Reforestation programmes have lapsed, as has protection of the Virunga and Akagera national parks.

Fishing Fishing in Rwanda, particularly in Lakes Kivu and Ihema, has not been fully exploited. The pre-war annual catch was 5,000-6,000 tonnes. This halved in 1994 but has since recovered to almost 4,500 tonnes.

Mining

Rwanda has deposits of cassiterite, wolfram, colombo-tantalite, tin, gold and sapphires. The cassiterite deposit is estimated at 90,000 tonnes. Annual exports averaged around 560 tonnes between 1987 and 1993, and after dropping sharply in 1994 recovered to 453 tonnes in 1997. In 1997, cassiterite exports were worth an estimated $1m.

Rwanda mined 141 tonnes of wolfram in 1993 but none in 1994. In 1997 42 tonnes were produced. In 1993, 171 tonnes of colombo-tantalite were mined, and after falling sharply in 1994, a record 250 tonnes was produced in 1997. Gold is mined in small quantities by members of the Coopimar co-operative in Myove, Byumba, but no official figures are available for production. The Rwandan Patriotic Front (RPA) has been facilitating the illicit import of gold from the Democratic Republic of Congo (Congo, formerly Zaire) since August 1998. Sapphires are mined informally in the Nyungwe forest in Cyangugu prefecture. (See Reference table 13 for minerals production figures.)

Manufacturing

Rwanda had virtually no manufacturing sector at independence, but subsequently developed an agricultural processing capacity for tea, coffee, dairy products, animal feed, sugar, leather, tobacco and beverages. Rwanda also produces textiles, some paper products, a selection of chemical goods including paint, soap and toothpaste, building materials such as corrugated roofing, tiles and bricks, and farming implements. Manufacturing accounted for 14% of GDP in 1997. (See Reference table 14 for historical manufacturing production figures.)

The war and genocide slashed production in every sector. Most companies have since resumed operations, although at reduced output levels. Most Rwandan industries are regionally uncompetitive, and the problem is compounded by extensive smuggling. Manufacturers have appealed to the

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government for protective tariffs but the government has refused, promising sterner measures to stop smuggling instead. The government also says that it will consider ways in which industry’s water and energy costs, which are among the highest in the region, can be reduced.

Financial services

The Banque nationale Rwanda first established a central bank, the Banque nationale du Rwanda du Rwanda (BNR), in 1960. It was looted in July 1994 but reopened later in the year. Its governor, Gerard Nyetegeka, went into exile in December 1995, protesting at human rights violations and interference from the Rwandan Patriotic Front (RPA) in the running of the central bank. The government denied the allegation, accused him of embezzlement, and replaced him with François Mutemberezi.

The commercial banks There are four main commercial banks, of which two pre-date the war and two were established in 1995. The former are the Banque de Kigali, jointly owned by the state and two Belgian institutions—Belgolaise bank and Générale de Banque—and the Banque commerciale du Rwanda (BCR), in which the state is a 44.44% shareholder, while the Banque Nationale du Paris has 7.73%, the BBL Bruxelloise has 7.73% and Geneva’s SFOM has 23.19%. The BCR is believed to be financing the RPA’s war in Congo with the help of the BBL, though they both deny it. The government is considering selling its stake in both the Banque du Kigali and the BCR banks as part of the privatisation process, but has yet to make a formal announcement on the matter. The new banks are the Banque de commerce, développement et l’industrie (BCDI), whose main shareholders are Rwandans, and the Gold Trust Bank of Rwanda, whose main shareholders are Ugandan Asians.

The government savings and development bank, the Banque Rwandaise de développement (BRD), was looted in 1994 and reopened in mid-1995 with Rwfr3bn ($114m) of bad debt. Its problems have continued and two senior directors were sacked by the government in 1998. The co-operative Banque Populaire, which specialises in lending money for housing construction, has 137 branches in Rwanda, and was established with Swiss assistance in 1975. Two insurance companies have restarted operations on a modest scale since 1994: the state-owned Sonarwa and Soras, owned by French group UAP.

Lending rates are between 17% and 20%. The deposit rate peaked at 12% in 1996 but has since fallen back to a lowly 8%. The discount rate was 11.5% in mid-1999, with interest on the government’s overdraft 2% lower.

Other services

Tourism Rwanda’s tourism has traditionally centred on the Akagera game park and the gorillas of the Virunga mountains. The Akagera park never had the appeal of much larger parks in East Africa and was reduced in size in 1995 to make way for new human settlements. The Rwandan gorillas live dangerously close to the

war zones of east Congo, but Rwanda’s Virunga park reopened nonetheless in June 1999 after three years of closure.

The external sector

Trade in goods

Foreign trade, 1998 ($ m; fob)

1998 Merchandise exports 82.1 Merchandise imports –326.0 Trade balance –243.9 Source: Ministry of Finance.

Trends in the overall trade Rwanda’s export earnings covered 30% or less of its import spending balance throughout most of the 1980s and 1990s, and the resulting gap was met by borrowing and unrequited transfers, mainly in the form of bilateral and multilateral grants. In the first few years after the 1994 genocide the trend was distorted by the fact that Rwanda’s export capacity recovered faster than its import capacity, and export earnings covered 39% of import costs in 1997. However, imports increased by 16% in 1998 while export earnings fell both because of falling coffee harvests and a decline in international prices (see below), with the result that export earnings covered only 25% of import costs in that year. Once again, the gap has been financed by borrowing and foreign aid.

Despite government attempts to revitalise the tea and coffee sectors through liberalisation and privatisation, and to encourage non-traditional exports, there is no foreseeable prospect of Rwanda ever earning enough from exports to pay for its imports, so the government needs to ensure continued inflows of aid and fresh loans. (See Reference tables 15 and 16 for historical data on imports and exports.)

Fluctuations in the The impact of the decline in Rwanda’s coffee production since its temporary fortunes of tea and coffee recovery in 1995/96 was initially reduced by rising international prices. Rwandan coffee is classed on the international market as “Other milds”. Other milds sold for 120c/lb in 1996 and 185c/lb in 1997, but fell back to 132c/lb in 1998. Since then, prices have kept falling, and in April 1999 stood at 99.69c/lb, with the trend still downwards. The result of the high price of coffee in 1997 was that despite a poor harvest of 14,800 tonnes, Rwanda still earned about $45m from the crop, but in 1998 earnings appear to have been under $30m.

Rwandan tea export volumes are rising steadily and look set to continue to do so. Rwanda exported about 12,400 tonnes of tea in 1997 at $1.6/kg, earning

EIU Country Profile 1999-2000 © The Economist Intelligence Unit Limited 1999 Rwanda 31

the country $19.5m. The value of Rwanda’s exports of hides increased by an impressive 43% between 1996 and 1997, while cassiterite exports increased by 20% in value over the same period to reach $1m. Pyrethrum and chincona exports have also increased substantially, and were worth $3.4m in 1997, compared with only $300,000 the year before.

Principal exports, 1997 ($ m; fob)

Coffee 45.0 Tea 19.5 Hides 4.6 Source: BNR.

Changes in regional Rwanda’s main route to the sea is via Uganda and Kenya to the port of trading patterns Mombasa. The more difficult route through Tanzania to Dar es Salaam is also used, but carries far less trade. The war has halted most formal trade between Rwanda and the Democratic Republic of Congo (Congo, formerly Zaire), but informal trade between the two continues to thrive. Trade with Uganda is growing, in part because of the family and business networks of returned “old” refugees, and has resumed at an official level with Burundi since the lifting of sanctions in January 1999. Imports from South Africa have grown markedly in recent years, but have yet to be matched by a significant increase in Rwandan exports to South Africa. (See Reference table 17 for historical data on the direction of trade.)

Main trading partners, 1996a ($ m)

Exports to: Imports from: Brazil 82 Tanzania 47 Germany 27 Kenya 44 US 8 US 41 Netherlands 5 Belgium-Luxembourg 26 UK 4 Germany 17

a Based on partners’ trade returns; subject to a wide margin of error.

Source: IMF, Direction of Trade Statistics Yearbook.

Rwanda and regional trade Rwanda is a member of three regional trade organisations: the Common organisations Market for Eastern and Southern Africa (Comesa), the Communauté économique des états de l’Afrique centrale (CEEAC), and the Communauté économique des pays des grands lacs (CEPGL). Rwanda is a marginal member of Comesa and the CEEAC. CEPGL consists only of Rwanda, Burundi and Congo and has never functioned effectively, although trade between the three countries has proved remarkably resilient, mostly in the hidden economy. Rwanda has applied to join the East African Community (EAC) and its application has been accepted, but it has not yet formally joined. The EAC looks set to be Rwanda’s most important regional trade grouping, deepening Rwanda’s links with its major regional trade partners. Even relatively minor

agreements that reduce tariffs and other legal trade costs between group members will have a beneficial effect on the Rwandan economy.

Invisibles and the current account

According to government statistics (which differ from the IMF figures given below) Rwanda earned $29.2m from services in 1997, and spent $189.3m, leaving a $160.1m deficit, 24% higher than the year before. Most service revenue comes from hotels though telecommunications is growing in importance too. Service payments are mostly for shipping and financial services, as well as interest payments on foreign debt, which amounted to $12.3m in 1997. Unrequited transfers, mainly in the form of grants and concessional loans, almost precisely cancel out the otherwise persistently negative current account Fortunately for Rwanda, this support seems assured for the medium term. (See Reference table 18 for historical data on the balance of payments.)

Current account, 1997 ($ m)

Merchandise exports fob 93.2 Merchandise imports fob -245.6 Trade balance –152.4 Net services –184.5 Net income –15.7 Net current transfers 259.8 Current-account balance -92.7 Source: IMF, International Financial Statistics.

Capital flows and foreign debt

None of Rwanda’s debt is private and non-guaranteed, which is to be expected as the country is a poor credit risk. Almost all its foreign debt consists of concessional loans from multilateral donors. The new government in 1994 inherited foreign debt of $945m, $70m of which was principal and interest arrears. The debt stock had risen to $1.2bn by 1998, but thanks to significant GDP growth in 1997 and 1998, this represented only 58% of GDP, down from 78% in 1996. Debt arrears stood at $97.5m, with the government prioritising payments to multilateral donors, the World Bank, the International Fund for Agriculture Development (IFAD) and the African Development Bank (ADB).

About 80% of Rwanda’s debt is owed to multilateral institutions. Debt servicing cost Rwanda $39.6m in 1997, which was 45% of export earnings. A multilateral debt trust was established in July 1998 with an initial contribution from donors of $41.7m to assist Rwanda in servicing its debt, and the Rwandan government is pushing hard for inclusion in the controversial heavily indebted poor countries (HIPC) debt-reduction programme. Meanwhile, in July 1998 Paris Club bilateral creditors enabled Rwanda to obtain debt relief under the

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Naples terms, which provide for a reduction of 67% of the total debt and generous rescheduling for the remainder.

Rwanda’s post-war borrowing began in January 1995 when a roundtable conference in Geneva pledged $587m in the form of grants and concessional loans, mostly from the EU, the World Bank, the US and Germany. A conference to review progress on the programme in Kigali in mid-July 1995 saw an additional $135m of pledges. The follow-up conference in June 1996 endorsed the Rwandan government’s growth strategy, drawn up with World Bank assistance, and pledged $627m of the requested $830m for 1996-98.

By November 1996, when the next conference was held, $696.5m had been disbursed. The next conference took place in June 1998 and resulted in a further $250m pledged over three years. This money included the multilateral fund to assist Rwanda’s debt servicing (see above), which enabled the IMF to formally grant Rwanda enhanced structural adjustment fund (ESAF) lending rights. These are worth $95m over three years. The IMF held a mid-term review in January 1999 and concluded that Rwanda had met or nearly met all its major targets. Other donors have felt less generous in 1999, primarily because of Rwanda’s role in the war in DRC, which has led the EU in particular to slow aid and lending disbursal. (For historical series on Rwanda’s debt structure and the origins of aid see Reference tables 19 and 20.)

Foreign reserves and the exchange rate

Foreign reserves, 1998 ($ m; end-period)

Foreign exchange 144.31 SDRs 24.44 Total reserves excl gold 168.75 Source: IMF, International Financial Statistics.

On March 6th 1995 the Rwandan franc was allowed to float for the first time. This resulted in an immediate depreciation of 85%, as the official exchange rate fell from Rwfr130:$1 to Rwfr240:$1, and then depreciated steadily to Rwfr320:$1. The franc appreciated in 1996 and 1997 but slipped back in 1998 because of weaker revenue from coffee and delays in the disbursement of donor funds. The currency averaged Rwafr312.3:$1 for the year. (See Reference table 22 for historical data on the exchange rate.) Parallel exchange dealers offer a small premium on the bank rate, usually of about 0.5%, but the floating of the franc and the legalisation of foreign-exchange bureaux in Kigali have diminished their appeal.

Total reserves excluding gold stood at $47m at the end of 1993. They fell to $32m in 1994, but increased to over $168m in 1998, entirely because of donor support. (See Reference table 21 for a breakdown of Rwanda’s foreign reserves position.)

Appendices

Regional organisations

For information about the regional organisations to which Rwanda belongs, see Burundi: Regional organisations. The two countries belong to the same regional organisations.

Sources of information

National statistical sources Rapport Annuel/Mensuel, Banque nationale du Rwanda, Kigali. The Banque nationale de Rwanda (BNR, the central bank) publishes monthly and annual bulletins, providing a wide range of information on the country.

Rwanda Development Indicators 1998, Ministry of Finance. A handy, clearly presented and pretty comprehensive selection of official economic and social statistics.

Except for agricultural produce statistics, where production and export figures are given, official statistical sources give no clues as to the size and extent of the parallel economy. Academic and informal studies suggest that it constitutes over 60% of total economic activity in Rwanda, particularly in regional merchandise trade and retail trade.

International statistical The principal international sources for Rwanda are: the World Bank’s Global sources Development Finance, World Tables and World Development Report; the IMF’s International Financial Statistics and Direction of Trade Statistics; the UN Food and Agriculture Organisation (FAO)’s yearly production statistics; Energy Data Associates; and the International Coffee Organisation. Most of their figures are based on national returns, and are thus no more reliable than national statistics.

Select bibliography African Rights, Rwanda: Death, despair and defiance, London, 1994

African Rights, Rwanda: The Insurgency in the Northwest, London, 1998

Amnesty International, Rwanda, the hidden violence: ‘Disappearances and killings continue, London, 1998

Colette Braeckman, Rwanda, Histoire d’un genocide, Fayard, Paris, 1994

Philip Gourevitch, We wish to inform you that tomorrow we will be killed along with our families: stories from Rwanda, Farrar Strauss and Giroux, London, 1998

Human Rights Watch, Rwanda/Zaire: Rearming with Impunity, New York, 1995

Human Rights Watch, Leave none to tell the story, New York 1999

René Lemarchand, Rwanda and Burundi, Faber, Pall Mall, London, 1970

La Lettre du Collectif des Ligues et Associations de Défense des Droits de l’Homme au Rwanda (CLADHO) (monthly), Kigali

EIU Country Profile 1999-2000 © The Economist Intelligence Unit Limited 1999 Rwanda 35

Ian Linden, Church, State, and Revolution in Rwanda, Manchester University Press, Manchester, 1977

L Minear and P Guillot, Soldiers to the Rescue: Humanitarian Lessons from Rwanda, London, 1996

Catherine Newbury, The Cohesion of Oppression, Columbia University Press, New York, 1988

Gérard Prunier; The Rwanda Crisis: History of a Genocide , Hurst and Co, London, 1995 and 1997

UN Steering Committee of the Joint Evaluation of Emergency Assistance to Rwanda: The International Response to Conflict and Genocide: Lessons from the Rwanda Experience, Copenhagen, 1996

UN, The United Nations and Rwanda 1993-1996, New York, 1997

Internet sites Alertnet: http://www.alertnet.org (continuing series of articles on the humanitarian response to crises in the Great Lakes)

African Rights: http://www.unimondo.org/AfricanRights

Amnesty International: http://www.amnesty.org

BBC Africa service: http://news.bbc.co.uk/hi/english/world/africa/newsid_376000/376752.stm (East African news review)

ICTR: http://www.un.org/law/rwanda (ICTR news including verdicts)

Ubutabera: http://intermedia-org/ubu.html (independent newsletter monitoring developments at the international criminal tribunal for Rwanda)

Mail & Guardian: http://www.mg.co.za/mg/africa_archive/rwanda_archive.html

Banque Commerciale du Rwanda: http://www.bcr-rwanda.com

Hotel reservations: http://www.abt-travel.com/hotels/AFRICA/RWANDA.HTML

Reference tables

These reference tables provide the most up-to-date statistics available at the date of publication.

Reference table 1 Population (m)

1994 1995 1996 1997 1998a Total 5.80 5.95 6.20 7.80 8.08 % change -23.0 2.5 4.2 25.8 3.5

a EIU estimate, based on UN statistics.

Sources: UN Department for Economic and Social Information and Policy Analysis, Population Division; EIU.

Reference table 2 Population breakdown by age (% of total)

1991 1997 0-14 48 47 15-34 32 32 35-54 13 14 55-75+ 7 7 Source: Ministry of Finance.

Reference table 3 Labour force (m)

Total Male Female Economically active 4.41 1.96 2.44 primary sector 4.02 1.70 2.30 secondary sector 0.07 0.07 0.00 tertiary sector 0.27 0.17 0.11 Source: Ministry of Finance.

Reference table 4 National energy statistics

1993 1994 1995 1996 1997 Electricity (m kwh) Available supply 189.54 49.60 112.93 153.76 183.16 Domestic production 92.46 24.0 53.6 71.2 110.0 Imports 97.08 25.6 59.3 82.6 73.2 Natural gas (cu metres) production 378.9 240.9 378.9 309.8 356.6 consumption 0.4 – 0.4 0.3 – Source: Rwandan authorities.

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Reference table 5 Government finances (Rwfr m)

1991 1992 1993 1994 1995 Revenue 26,056 28,723 29,597 5,882 23,128 Grants 13,682 10,796 19,171 1,515 20,889 Expenditure –47,658 –54,868 –68,742 22,183 42,089 Net lending 369 315 384 n/a n/a Overall balance –7,551 –15,034 –19,590 n/a n/a Source: IMF, International Financial Statistics.

Reference table 6 Money supply (Rwfr m unless otherwise indicated)

1994 1995 1996 1997 1998 Demand deposits 16,165 22,586 24,979 34,523 28,509 Money (M1) incl others 28,810 40,658 45,423 55,746 55,291 % change, year on year 15.6 41.1 11.7 22.7 -0.8 Quasi-money 8,375 22,388 23,052 32,626 36,193 Money (M2) 37,185 63,046 68,475 88,372 91,484 % change, year on year –3.8 69.5 8.6 28.6 3.5 Source: IMF, International Financial Statistics.

Reference table 7 Gross domestic product (market prices, unless otherwise indicated)

1994 1995 1996 1997 1998 Rwfr bn At current prices 165.1 347.7 427.0 561.6 635.8 At constant (1995) prices 254.5 347.7 389.6 432.2 n/a Real change (%) -49.5 36.6 12.0 10.9 10.5a

a EIU estimate.

Sources: IMF; Ministry of Finance.

Reference table 8 Gross domestic product by expenditure (Rwfr bn; at current prices)

1994 1995 1996 1997 1998 Private consumption 196.5 345.7 423.0 518.6 592.4 Government consumption 13.6 30.9 42.5 49.9 54.5 Gross domestic investment 15.9 51.3 66.8 84.5 99.5 Exports of goods & services 7.1 25.7 27.3 35.3 35.6 Imports of goods & services –105.0 –104.3 –118.3 –126.7 -146.1 GDP at market prices 165.1 347.7 427.0 561.6 635.8 Source: IMF, International Financial Statistics.

Reference table 9 Gross domestic product by sector (Rwfr bn unless otherwise indicated; at current prices)

1993 1994 1995 1996 1997a Agriculture 95.9 66.1 126.8 156.8 205.1 % of total 33.7 23.2 44.6 55.1 43.7 Industry 52.1 33.0 68.4 89.7 126.4 % of total 18.3 20.0 19.7 21.0 22.5 of which: manufacturing 32.6 27.5 46.5 60.4 88.4 % of total 11.5 16.7 13.4 14.1 15.7 Services 119.5 61.7 133.7 152.4 189.7 % of total 42.0 37.4 38.5 35.7 33.8 GDP at factor cost 267.6 160.7 328.9 401.0 521.3

a Estimates.

Sources: IMF; Ministry of Finance.

Reference table 10 Consumer pricesa

1993 1994 1995 1996 1997 Index (1989=100) 142.88 151.14 285.3 311.90 365.27 % change 11.2 5.8 88.4 9.3 17.1

a Middle-income group, Kigali.

Source: IMF, International Financial Statistics.

Reference table 11 Food crop production (‘000 tonnes)

1993 1994 1995 1996 1997 Plantain 2,136 1,489 2,002 2,105 2,170 Beans 169 50 132 184 145 Sorghum 128 55 77 102 94 Maize 87 66 55 66 81 Sweet potatoes 997 673 551 665 689 Cassava 291 228 148 221 229 Source: Ministry of Finance.

Reference table 12 Agricultural production for export (tonnes unless otherwise indicated)

1994 1995 1996a 1997 1998 Coffeeb 1,800 21,800 15,200 14,800 13,000 ‘000 60-kg bags 30 363 253 247 217 Tea 4,136 5,413 9,058 13,228 13,400

a EIU estimates. b Crop years (April-March), starting in year stated.

Sources: Ministry of Agriculture; F O Licht.

EIU Country Profile 1999-2000 © The Economist Intelligence Unit Limited 1999 Rwanda 39

Reference table 13 Minerals production (tonnes)

1993 1994 1995 1996 1997 Cassiterite 653.0 358.1 247.0 330.0 453.0 Wolfram 141.1 n/a 19.2 62.3 42.0 Colombo-tantalite 170.9 56.2 53.9 97.0 250.0 Source: Rwandan authorities.

Reference table 14 Manufacturing production

1993 1994 1995 1996 1997 Beer (m litres) 102.3 44.1 49.1 59.6 76.7 % change – –57 11 21.4 29 Soft drinks (m litres) 19.1 6.2 13.7 18.4 24.8 % change – –68 121 34 35 Sugar (tonnes) 2,912 509 0 0 0 % change 44 -83 – – – Cigarettes (m) 432 106 36 129 253 % change 16 –75 –66 258 96 Soap (solid & liquid; tonnes) – – 4,988 6,883 8,277 % change n/a n/a n/a 38 20 Textiles (m yards) 13.2 3.3 2.9 5.8 8.6 % change – –75 –12 100 48 Source: Rwandan authorities.

Reference table 15 Exports ($ m; fob)

1993 1994 1995 1996 1997a Coffee 37.6 17.4 38.8 43.2 45.0 Tea 18.6 5.8 3.8 9.3 19.5 Hides 2.5 1.2 2.2 3.2 4.6 Cassiterite 1.5 0.5 0.9 0.8 1.0 Pyrethrum & chincona 0.6 0.3 0.4 0.3 3.4 Total 67.7 1.8 4.3 5.2 14.0

a Estimate.

Sources: Banque Nationale du Rwanda (BNR); IMF.

Reference table 16 Imports ($ m; fob)

1993 1994 1995 1996 1997a Capital goods 72.0 36.0 49.8 54.1 63.8 Intermediate goods 91.2 22.8 41.1 54.7 70.4 Energy goods 35.1 23.6 21.8 26.7 31.2 Total 267.7 367.4 194.1 213.3 280.4

a Estimates.

Sources: BNR; IMF.

Reference table 17 Main trading partnersa ($ m)

1992 1993 1994 1995 1996 Exports to: Belgium-Luxembourg 17 16 4 1 1 Germany 2431121227 Netherlands 14 10 7 12 5 Pakistan 10 8 6 2 4 UK 43234 Imports from: Belgium-Luxembourg 49 36 16 21 26 US 5 8 38 42 41 Tanzania 23 27 33 40 47 Kenya 2826313844 France 20 25 19 15 13

a Based on partners’ trade returns; subject to a wide margin of error.

Source: IMF, Direction of Trade Statistics, yearbook.

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Reference table 18 Balance of payments, IMF estimates ($ m)

1993 1994 1995 1996 1997 Goods: exports fob 67.7 42.2 56.7 61.7 93.2 Goods: imports fob –267.8 –480.6 –219.1 –218.5 -245.6 Trade balance –200.1 –438.4 –162.5 –156.8 -152.4 Services: credit 34.3 n/a 17.9 21.5 58.3 Services: debit –136.4 –143.4 –154.7 –150.6 -242.8 Income: credit 3.0 n/a 24.3 5.4 8.4 Income: debit –18.2 n/a –17.5 –18.8 -24.1 Current transfers: credit 208.5 521.4 354.9 293.9 287.2 Current transfers: debit –20.1 n/a –4.9 –1.7 -27.4 Current-account balance –129.0 –60.4 57.5 -7.1 -92.7 Net direct investment 5.8 n/a 2.2 2.2 2.6 Financial balance 88.5 –16.4 –10.7 24.8 45.8 Net errors & omissions –8.1 81.8 5.8 2.7 77.5 Overall balance –49.9 5.0 52.6 20.3 30.5 Source: IMF, International Financial Statistics.

Reference table 19 External debt, World Bank estimates ($ m unless otherwise indicated)

1993 1994 1995 1996 1997 Total external debt 909 952 1,029 1,043 1,111 Long-term debt 838 905 970 985 994 Official creditors 836 904 968 983 992 Multilateral 688 754 811 834 850 Bilateral 148 150 157 149 142 Private creditors 1 2 2 2 1 Use of IMF credit 12 13 26 24 40 Short-term debt 59 34 32 34 77 of which: interest arrears on long-term debt 10 16 18 20 29 Total debt service 22 4 20 18 22 Principal 11 2 11 10 13 Interest 10 3 9 7 10 of which: short-term debt 6 1 1 1 2 Ratios (%) Total external debt/GNP 46.4 127.5 77.2 75.5 60.0 Debt-service ratioa 19.9 9.9 20.4 19.8 13.3 Short-term debt/total external debt 6.5 3.5 3.1 3.3 6.9 Concessional long-term loans/ long-term debt 91.9 94.8 93.5 93.6 88.7

a Debt service as percentage of earnings from exports of goods and services.

Source: World Bank, Global Development Finance.

Reference table 20 Net official development assistancea ($ m)

1993 1994 1995 1996 1997 Bilateral 201.3 487.4 339.2 252.0 178.7 of which: US 26.0 194.0 101.0 10.0 9.0 Germany 38.6 46.6 52.1 45.6 26.0 UK 1.2 44.6 34.5 19.3 10.0 Netherlands 7.2 32.2 46.7 41.1 29.2 Belgium 36.7 29.0 13.9 31.3 21.0 Multilateral 154.5 226.2 373.2 421.2 412.4 of which: UNHCR 6.1 75.1 100.2 87.1 112.8 WFP 53.9 47.7 150.7 183.8 145.0 EU 36.0 45.6 17.9 55.4 46.0 UNICEF 0.0 32.3 32.7 22.4 18.3 IDA 36.6 11.1 29.0 38.1 47.5 Total 358.2 714.6 712.1 674.4 591.5 of which: grants 303.2 704.4 672.7 631.8 543.5

a Disbursements minus repayments. Official developments assistance is defined as grants and loans with at least a 25% grant element, provided by OECD and OPEC member countries and multilateral agencies, and administered with the aim of providing development and welfare in the recipient country.

Source: OECD, Geographical Distribution of Financial Flows to Aid Recipients.

Reference table 21 Foreign reserves ($ m; end-period)

1994 1995 1996 1997 1998 Foreign exchange 34.40 78.80 88.47 126.84 144.31 SDRs 2.55 20.29 18.28 26.50 24.44 Reserve position in the IMF 9.79 n/a n/a n/a n/a Total reserves excl gold 51.25 99.10 106.74 153.34 168.75 Source: IMF, International Financial Statistics.

Reference table 22 Exchange rates (averages; per unit of currency)

1995 1996 1997 1998 Rwfr:$ 262.2 306.8 301.5 312.3 Rwfr:£ 413.4 479.1 493.8 519.5 Rwfr:SDR 397.8 445.4 414.9 439.7 NUSh:Rwfr 3.7 2.3 3.6 4.0 Rwfr:KSh 5.1 5.4 5.1 5.2 Source: IMF, International Financial Statistics.

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Burundi

Basic data

Land area 26,338 sq km

Population 631m (mid-1998 EIU estimate)

Main town Bujumbura (capital), 400,000 (estimate)

Climate Tropical

Weather in Bujumbura Average annual temperature 24°C; driest months, June-September; wettest months February-May; average monthly rainfall 65 mm

Languages Kirundi and French

Currency Burundi franc (Bufr)=100 centimes. Average exchange rate in 1998, Bufr447.8:$1; exchange rate on July 5th 1999 Bufr550:$1

Time 2 hours ahead of GMT

Political background

Historical background

The expansion of the During the 12th century, a monarchy evolved from the clan system in Burundi monarchy asserting a holy status for itself that transcended clan divisions. In the centuries that followed, Burundi’s monarchy extended the kingdom through military conquest, and consolidated its hold with the appointment of loyal ganwa (clan lords), who were supposed to enable the kings to collect fealty from local clan leaders, but who often ended up as formidable power-brokers in their own right. (For early history, see Rwanda: Historical background.)

Clan-based The chief architects of the Burundian monarchy’s expansion were mwami fragmentation— (king) Ntare I in the 17th century and Ntare II Rugamba (1795-1852). Conflict and fragmentation in Burundi began with the death of Ntare II. He was succeeded by his son, Mwezi I Kitabo of the Bezi clan, but the succession was disputed by Mwezi’s elder brothers of the Batare clan. German imperialists entered the fray in 1899, first opposing and then supporting Mwezi. With German assistance, Mwezi secured the throne but had to cede ultimate authority to Germany, whose administrators ruled Burundi through him.

—is reinforced by In 1919, after Germany’s first world war defeat, Burundi came under Belgian colonial rule rule. Belgian local government reforms initiated in 1926 further enhanced Bezi power by granting the clan far more ganwa positions than their Batare rivals. Ganwa power as a whole was deepened; ganwas were made Burundi’s tax assessors, collectors and appeal judges, and also administered forced labour for public works. After 1945 relations between the colonial authorities and Bezi ganwa cooled and they soon demanded immediate independence while Batare ganwa urged internal reform and elections first. Belgium, a whose government was reluctant to decolonise, supported the Batare ganwas.

The way to independence In 1957, the year of a UN visit designed to speed up moves towards independence, Bezi ganwa Léopold Bihumagani formed the Union pour le progrès national (Uprona). Uprona was soon taken over by the ruling mwami Mwambutsa’s son, Prince Louis Rwagasore, who used the monarchy’s alleged transcendence of ethnicity to build a diverse support base that encompassed a large portion of the Hutu peasantry and Bujumbura’s small industrial working class, as well as the Bezi clan and clans related to it. Uprona’s chief rival, the Parti démocratique chrétien (PDC), led by Joseph Biroli, was supported by the Batare and related clans and large sections of the emerging urban middle class. The PDC also received the overt support of the colonial administration.

In 1959 Belgium granted Burundi internal autonomy, and communal and legislative elections were held in 1961. Uprona won comfortably, but the triumphant Rwagasore was assassinated in 1961 by agents of the PDC, with a strong suspicion of Belgian involvement. Burundi became independent a year later. Both mwami Mwambutsa and Uprona then set to work appointing Bezi clan members to positions of power.

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A series of coups Between 1963 and 1965 there were four governments, with the last cut short by the assassination of Hutu prime minister, Pierre Ngendanduwe. Uprona, which was at that time mainly Hutu, won legislative elections soon after but Mwambutsa appointed Leopold Biha, a Tutsi ganwa, as prime minister. Biha ignored the Uprona-dominated parliament and began replacing elected Hutu local government officials with his own supporters. Hutu army officers attempted a coup later in the year, and Hutu sections of the army mutinied. Mwambutsa went into exile, while Biha purged Uprona and the army of Hutus. Hutu civilians were also massacred. After a brief interregnum Mwambutsa’s son Ntare V became the new mwami in September 1966. Fearful of Biha’s influence, Ntare replaced him with Captain Michel Micombero, but Mr Micombero deposed Ntare in a coup two months later, instituted a military government and declared a republic.

Some remaining Hutu army officers attempted another coup in 1969 and more purges followed. When Hutu villagers killed Tutsis in two communes in 1972, the army carried out widespread revenge massacres that resulted in between 80,000 and 200,000 casualties. Intellectuals were among those targeted, and it remains the lament of Hutu politicians that many of their brightest talents were killed in 1972. Many Hutus left as refugees, spreading out into Zaire (now the Democratic Republic of Congo), Rwanda and Tanzania.

In 1974 a new constitution made the leader of Uprona the automatic head of government and president of Burundi. Two years later, in 1976, Colonel Jean- Baptiste Bagaza staged a successful coup. Mr Bagaza, like Mr Micombero a Tutsi from the southern province of Bururi, was a socialist and courted Soviet, Chinese and Libyan support. Most of his politics, however, concerned continued consolidation of Tutsi control over the state and by the end of his rule the process was virtually complete. Mr Bagaza’s authoritarian attempts to extend state hegemony brought him into conflict with the Roman Catholic Church in the early 1980s. By the mid-1980s, Burundi needed increased financial aid, which donors would only give in return for human rights improvements. Mr Bagaza made a few concessions and Burundi entered a structural adjustment programme in 1986. In 1987 Mr Bagaza was ousted by the army commander-in-chief, Major Pierre Buyoya, who repaired relations with the church and halted some of the more glaring instances of corruption.

Militia activity In 1988 Hutu refugee militia initiated a violent peasant uprising resulting in hundreds of Tutsi deaths. Retaliation by the armed forces killed thousands of Hutus, with thousands more becoming refugees. At the same time, Mr Buyoya brought loyal Hutu members of Uprona into government, including Adrien Sibomana as prime minister. In 1990 Mr Buyoya launched a “charter of national unity” and supplanted the ruling military committee with an enlarged Uprona central committee with Nicholas Mayugi, a Hutu, as its secretary-general.

The introduction of This did not satisfy Hutu militias, who stepped up their military campaign. multiparty politics Renewed attacks in November 1991 prompted army reprisals that killed thousands of Hutus but Mr Buyoya persisted with his reforms. A referendum in March 1992 endorsed a constitution that legalised a multiparty system and

instituted a democratic electoral process. A general election was called for 1993. Melchior Ndadaye and other Hutu intellectuals who had fled in 1972 but had since returned formed the Front pour la démocratie au Burundi (Frodebu). Frodebu’s public platform was pluralist and espoused human rights, but the party acquired a de facto ethnic mantle, attracting overwhelming grass-roots Hutu support. This meant that while the Frodebu leadership explicitly rejected Hutu supremacism, the issue was more ambiguous at local level. Mr Buyoya meanwhile could rely on the support of most Tutsis, who dreaded the implications of a landslide victory for Frodebu.

Frodebu’s victory is The June 1993 election resulted in easy victories for Ndadaye and Frodebu. followed by a coup Ndadaye formed a coalition government, giving Uprona the premiership, and the defence and internal security ministries to the military. Ndadaye initiated a crash affirmative action programme to bring Frodebu supporters into the civil service but had not got far in this when the armed forces staged a coup in October 1993 and killed Ndadaye and other senior Frodebu members. Hutu militias then indiscriminately massacred Tutsis in most parts of the country with apparently genocidal intent. The extent of Frodebu’s involvement in the killings is disputed, although Frodebuists admit to party involvement in some areas. The armed forces moved fast to stop the massacres and carry out their own. Up to 100,000 people were killed in all, and thousands of Hutus fled for Zaire and Tanzania.

Frodebu tries to rule again The military failed to form a government the international community would recognise and senior officers distanced themselves from the coup. Frodebu’s Cyprien Ntaryamira was elected interim president by the Assemblée nationale (parliament) in January 1994, but was killed three months later when the plane he was travelling in with the Rwandan president Juvénal Habyarimana was shot down over the Rwandan capital, Kigali. Frodebu was greatly weakened and it was not until September 1994 that its Sylvestre Ntibantunganya was confirmed as president. Shortly afterwards the government and opposition signed a convention that institutionalised power-sharing at local, national and diplomatic levels. The convention was rejected as a sell-out by many senior Frodebuists including the interior minister, Léonard Nyangoma, who left Burundi and founded the Conseil national pour la défense de la démocratie (CNDD) with its military wing, the Forces pour la défense de la démocratie (FDD), which has pledged to defeat the Burundian armed forces. The convention was also rejected by Mr Bagaza’s Parti pour le rédressement national (Parena).

Civil war dragged on throughout 1995. Mr Ntibantunganya’s government grew progressively weaker and called repeatedly for international intervention but with Uprona and the armed forces so opposed, no country was prepared to risk sending troops. In March 1996 the former Tanzanian president, Julius Nyerere was appointed by regional heads of state as mediator in the Burundian conflict, with the endorsement of the UN and the Organisation of African Unity (OAU). In June 1996 Mr Nyerere secured the agreement in Arusha, Tanzania, of both the president and Uprona’s prime minister, Antoine Nduwayo, for an independently commanded regional armed force for Burundi, but once he was

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back home Mr Nduwayo denounced the deal and accused Mr Ntibantunganya of undermining Burundian sovereignty. After receiving threats from the military, Mr Ntibantunganya took refuge in the US embassy in July 1996. Mr Buyoya stepped into the power vacuum, proclaimed head of state by an unidentified group of “wise Burundians”, suspended the parliament and all political activity, and formed a government of his own.

Regional sanctions and Mr Nyerere quickly co-ordinated regional and OAU condemnation of the coup, further instability and regional heads of state imposed economic sanctions on Burundi in August 1996, with the aim of securing the restoration of the parliament and political activity and immediate, unconditional negotiations with rebel militias. Mr Buyoya’s coup was the signal for the Burundian armed forces and the FDD to intensify their war and civilian casualties multiplied accordingly. In late 1996 FDD bases in eastern Zaire were largely destroyed by Laurent Kabila’s Alliance des forces démocratiques pour la libération du Congo-Zaïre (AFDL) and the Burundian armed forces. Tens of thousands of refugees streamed back into Burundi, and the FDD regrouped in Burundi and the refugee camps of western Tanzania.

The regime tries to win the To entrench the military advantage of the Burundian armed forces, a civil war with controversial regroupment policy was enforced in 1997-99 involving the regroupment removal of nearly 700,000 people, almost all of them Hutus, to special guarded camps. The policy was a humanitarian disaster and attracted international condemnation, though security did improve in some areas.

Dealing with sanctions In April 1997 regional heads of state removed sanctions on most goods but retained them for fuel imports (except for humanitarian agencies) and Burundi’s exports after Mr Buyoya disclosed that there had been secret contacts between the government and CNDD for several months previously in Rome, Italy. Following vehement disapproval from Tutsi political groups, the government ended the Rome talks in July 1997. At meetings in August 1997 and February 1998, regional heads of state elected to maintain the remaining sanctions.

Frodebu joins Mr Buyoya’s The government and Frodebu parliamentarians agreed to share power in late government April 1998 and shortly afterwards adopted an interim constitution which legalised Mr Buyoya’s rule. Senior Frodebuists joined Mr Buyoya’s government in June, the Constitutional Court was revived and the parliament enlarged. The power-sharing agreement was denounced by both CNDD factions and Tanzanian-resident Frodebu president, Jean Minani, though the latter reluctantly accepted the deal soon afterwards.

Multiparty talks begin in Multiparty talks facilitated by Mr Nyerere and paid for by donors began in Arusha, Tanzania Arusha in June, with another round in July. Frustrated by the slow progress, donors urged a reconsideration of the region’s policy of sanctions while Frodebu ministers in Burundi’s government took up the call for the sanctions to be lifted. Arusha III took place in October 1998 with talks ending early owing to lack of funds. Burundi’s donors met in New York in January 1999 and agreed to resume assistance to Burundi whether sanctions were lifted or not.

Regional leaders then suspended the embargo indefinitely on January 23rd. The fourth round of Arusha talks ended on January 31st.

Burundi sends troops to Despite official denials, Burundi sent troops to the Democratic Republic of Congo Congo following the outbreak of a rebellion against Mr Kabila in August 1998, and by mid-1999 had at least 3,000 soldiers deployed in the country. Their main task is to engage the CNDD-FDD, which has increased its presence in Congo and is fighting on the side of Mr Kabila, apparently under Zimbabwean army command. The Burundian army’s Congolese operations have elicited threats of bombing raids on Bujumbura from the Congolese commander-in- chief, Major Faustin Munene; the Burundi government says that it will retaliate if attacked.

Important recent events

June 1993: Melchior Ndadaye’s predominantly Hutu Frodebu party wins Burundi’s first multiparty elections since 1965, and forms a coalition government.

October 1993: Tutsi-dominated armed forces stage a coup and murder Ndadaye. Hutu militias then massacre Tutsis while the armed forces target Hutus.

January-April 1994: After only three months as president, Frodebu’s Cyprien Ntaryamira is shot down while flying with Rwanda’s president, Juvénal Habyarimana.

July 1996: The former president, Pierre Buyoya, ends a year of conflict by staging a coup and proclaiming himself head of state.

August 1996: Regional sanctions against Burundi, co-ordinated by Tanzania’s former president, Julius Nyerere, begin.

February 1997: Hutus are placed in regroupment camps by mainly Tutsi army. Rebel attacks continue.

June 1998: Frodebu ministers join Mr Buyoya’s government; Mr Buyoya is sworn in as constitutional head of state; the constitutional court is reinstated; and the parliament is enlarged. Multiparty talks in Arusha, Tanzania, begin.

January 1999: Sanctions are suspended indefinitely by regional heads of state.

May 1999: Negotiating parties at Arusha split along ethnic lines into two negotiating blocs, with the multiparty government remaining aloof from both.

June 1999: Mr Buyoya proposes a ten-year transition which would leave him as president for at least five years.

Mr Buyoya proposes a ten- In May 1999 seven predominantly Hutu parties, including the CNDD and the year transition external wing of Frodebu, met in Moshi, Tanzania at Mr Nyerere’s behest to forge a common position prior to Arusha process committee meetings. The parties assumed joint positions on a number of issues and are now known as the Moshi group or G7. In response, eight predominantly Tutsi parties present

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in Arusha have since formed a negotiating bloc called G8. Delegations representing Uprona, the Burundi government and the national assembly have remained outside the two blocs. Donors have threatened privately to withdraw funding, but Mr Nyerere is predicting substantial agreement at Arusha by November. Meanwhile in June Mr Buyoya proposed a ten-year transition which would leave him in the presidency for at least five years.

Constitutions and institutions

A power-sharing Mr Buyoya suspended the constitution that he himself had drawn up in 1993 constitution after he seized power in 1996 and imposed instead a statutory order as the legal basis for his government, which Frodebu refused to recognise. The Frodebu- dominated Assemblée nationale and Mr Buyoya’s government compromised in April 1998, and announced a new partnership. As part of this deal, a transitional constitution was agreed and signed in June, which merged the 1993 constitution and the statutory order. The cabinet has been reduced, and the post of prime minister abolished and replaced by two vice-presidential posts, of which the more senior is held by Frodebu. The parliament, which had been much depleted by the murder and exile of many Frodebu delegates, has been expanded with 40 new appointments from across the political spectrum. Most of the parliament’s powers have been restored, with the exception of the main one—the right to remove the government through a vote of no confidence.

The judiciary is not Despite constitutional provision for the judiciary’s independence, it is independent appointed by government and largely subservient to the president’s wishes. Judicial personnel are predominantly Tutsi, though some Hutus have been appointed since June 1998, including the attorney-general. Thousands of people are in prison on suspicion of participation in the 1993 massacres and their trials began in 1997. Many have been sentenced to death and some have been executed, despite international protest. The trials of those accused of complicity in the 1993 coup also began in May 1997, but progressed more slowly. Five soldiers were sentenced to death for the murder of Ndadaye in May 1999, but all the senior military officers and politicians involved in the case were acquitted, to the anger of Ndadaye’s family and supporters.

Political forces

Frodebu The Front pour la démocratie au Burundi (Frodebu) won Burundi’s multiparty elections in 1993 under the leadership of Melchior Ndadaye and ruled, albeit only nominally towards the end, until 1996. Today the party is deeply divided, having split twice in its short lifespan over the issue of sharing power with political elements representing the interests of the country’s predominantly Tutsi military. The first split was in 1995 following power-sharing agreements Frodebu made with Uprona in late 1994, and led to the interior minister, Leonard Nyangoma, to form the CNDD (see below). The latest split began in 1998, after Frodebu’s internal wing led by the party secretary-general, Augustin

Nzojibwami, joined Mr Buyoya’s government. The external wing led by the party president, Jean Minani, rejected the decision, and the two wings have bickered and denounced each other ever since. The two wings have taken contrasting approaches at the Arusha talks. Frodebu’s external wing joined a negotiating bloc of Hutu parties known as G8 in May 1999 but the internal wing stayed out, denouncing G8 as unacceptably ethnicist. The internal wing negotiates in Arusha as the dominant element of the parliamentary delegation and as part of the government delegation.

Uprona The Union pour le progrès national (Uprona) began life as a national party but came over time to champion primarily Tutsi interests. Uprona was Burundi’s only legal party from 1966 till the advent of multipartyism in 1991. Uprona participated in the coalition government from 1993 to 1996 but then helped engineer its collapse, which was shortly followed by Mr Buyoya’s coup and subsequent presidency. Under the party president, Charles Mukasi, Uprona opposed Mr Buyoya, working with Frodebu and negotiating with rebel Hutu militia, and boycotted both the Burundi parliament and the Arusha multiparty talks. Mr Mukasi was deposed as leader of Uprona in October 1998 and replaced by Luc Rukingama, a Buyoya loyalist. Since then Uprona has fully supported Mr Buyoya’s political approach and has resumed its participation in the parliament and the Arusha talks.

CNDD The Conseil national pour la défense de la démocratie (CNDD) was founded by Leonard Nyangoma in 1995. Mr Nyangoma, then the interior minister, saw Frodebu’s 1994 power-sharing deal with Uprona as a sell-out and left the country to recruit a militia to defeat the Burundian army. The militia was called the Forces de la défense de la démocratie (FDD), with the CNDD established as its political wing. Mr Nyangoma proclaimed the CNDD the “true” Frodebu, and attracted a number of Frodebu parliamentarians, who joined him in exile and helped with fundraising and recruitment. But the CNDD lost its all- important armed wing in May 1998 when the FDD commander, Jean-Bosco Ndayikengurukiye, publicly broke with the party and formed the CNDD-FDD (see below), taking the bulk of FDD militia fighters with him. However, Mr Nyangoma has been able to retain influence through the Arusha talks, in which the CNDD is allowed to participate, but the CNDD-FDD is not. In mid- 1999 both the CNDD and the external wing of Frodebu joined the predominantly Hutu negotiating bloc at the Arusha talks, pointing to a growing rapprochement between the two.

CNDD-FDD Established by Mr Ndayikengurukiye in May 1998, after he broke with the CNDD leader, Mr Nyangoma (see above), the CNDD-FDD is the current political wing of the FDD militia. The CNDD-FDD claims that it wants to talk to the government but is being prevented by the structure of the Arusha multiparty talks. Meanwhile, the FDD is busy fighting for Mr Kabila in Congo and rearming itself in the process.

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Main political figures

Pierre Buyoya: President between 1987 and 1993 and now president again following a coup in July 1996. Those who installed Mr Buyoya in 1996 hoped that his presence would temper international hostility to the coup, but instead Mr Buyoya’s fellow heads of state imposed sanctions on Burundi. Concessions followed which Mr Buyoya insisted he had planned all along, and which he reminded the world would come faster if the sanctions were lifted. This helped weaken the resolve of the sanctions states and made donors impatient for the embargo’s end. In a personal triumph for the Burundian president, sanctions finally ended in January 1999 without Mr Buyoya having conceded anything that threatens his political position to his many opponents. Mr Buyoya has since felt confident enough to outline proposals for a lengthy transition that leaves him as president for a long time to come.

Jean Minani: President of Frodebu, Mr Minani escaped to Rwanda during the attempted coup of October 1993, and his broadcasts from there are alleged by many Tutsis to have incited genocide against them. Mr Minani has been in exile since July 1996 and lives in Tanzania. He is busy battling Frodebu secretary-general, Augustin Nzojibwami, for control of the party, while at the same time drawing closer to other predominantly Hutu parties at the Arusha talks, such as the CNDD.

Augustin Nzojibwami: Secretary-general of Frodebu. One of Frodebu’s main young talents who in 1998 chose to compromise with Mr Buyoya and the Burundian armed forces rather than to renew the armed struggle. Within Frodebu Mr Nzojibwami is more combative, particularly with Mr Minani, and there are signs that this is alienating other members of Frodebu’s internal wing.

Mathias Sinamenye: Second vice-president. A quiet spoken and well-regarded former head of the central bank whose daunting task it is to generate the economic growth needed to underpin Mr Buyoya’s latest strategy for Burundi’s political development. Mr Sinamenye tours the country regularly inspecting Burundi’s battered economic infrastructure and taking note of what needs doing to restore it, but until donors provide balance-of-payments support there is not much more that he can do.

Palipehutu The Parti pour la libération des peuples Hutu (Palipehutu) was founded in the 1970s and is still active. Palipehutu’s aim is to bring down the Burundian government through armed force, though it is also participating in the Arusha talks. Palipehutu competes with the FDD for influence in Burundi and the two militias occasionally clash.

The armed forces The armed forces number about 30,000-40,000, including five infantry brigades, their ranks swollen by the recruitment of university and secondary school students in 1996. Tutsis from Bururi dominate the officer corps, and Tutsis throughout Burundi tend to regard the armed forces as the principal guarantor of their security. Hutus meanwhile saw them as oppressors and Hutu political parties called for greater ethnic balance in their ranks. Increasing Hutu representation in the armed forces became government policy in 1998, but the process is voluntary and does not use quotas, to the relief of many Tutsis.

International relations and defence

Military forces, mid-1998

No. Army 30,000-40,000 Paramilitary gendarmerie 3,500 Total 33,500-43,500 Source: International Institute for Strategic Studies, The Military Balance.

Rwanda The Rwandan and Burundian governments both want to destroy the threat to them posed by Hutu militias operating in the region, and since late 1998 have been co-operating militarily to that end in the Democratic Republic of Congo (Congo, formerly Zaire). However, the legacy of mistrust between the two states that dates back to independence lives on. The Burundian government distrusts Rwanda’s regional ambitions, and regarded Rwanda’s participation in the regional sanctions initiative as opportunistic, designed for profit rather than founded on principle. Meanwhile the Rwandan government views Mr Buyoya’s administration as “old style” and ultimately doomed; it is still looking for signs of a Burundian political force concerned more with the leanness and efficiency it prides itself on than the political survival of one man as president.

Democratic Republic of The government of Congo was an ally until 1998 but has since accused Congo Burundi of invading its territory. The Burundian government concedes the presence of its armed forces in Congo, but says they are just there to protect trade routes and keep Burundian Hutu militia in Congo away from Burundi. This aim is inexorably taking Burundi’s troops deeper and deeper into Congo but the high profile of Rwanda and Uganda’s military intervention against Mr Kabila and his regional allies has enabled the Burundi government’s official position on the issue to remain less challenged than it otherwise might.

Tanzania More than 450,000 Burundian refugees live in Tanzanian camps. Tanzanians are tired of their presence and want them to leave, and their government is trying to achieve this by sponsoring multiparty talks and providing political assistance to delegations from Burundi’s predominantly Hutu parties. Some refugees in the camps have reconstituted militias that make armed raids into Burundi, straining relations between Burundi and Tanzania, and the two drifted close to war in late 1997. The Tanzanian government was the main supporter of sanctions against Burundi and only suspended them in 1999 after sustained donor pressure.

The international Having endorsed Mr Nyerere as mediator in March 1996 and approved the community region’s efforts at a unified Burundi policy, Western governments were dismayed at sanctions and forced their suspension in early 1999. In order not to be seen as abandoning their policy of “African solutions for African problems” those Western governments who have traditionally been Burundi’s main donors linked the resumption of aid to progress at the Arusha talks,

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which they are paying for. Since there has not been much progress at the talks substantial non-emergency aid to Burundi is still frozen. But the donors are restless once more, pressuring the Arusha talks facilitator and former Tanzanian president, Mr Nyerere, to try to force a deal so they can resume funding.

Resources and infrastructure

Population

Population indicators, 1995

Burundi Sub-Saharan Africa Population (m) 6.0 600 Growth rate (%) 2.8 2.7 Life expectancy (years) 50.3 52.0 Crude birth rate (per ‘000) 45.2 43.8 Crude death rate (per ‘000) 17.0 14.8 Infant mortality rate (per ‘000) 98.0 92.0 Source: IMF.

Burundi had an estimated population of 6.3m in 1998. There is no reliable information on the proportion of each ethnic group beyond the fact that there are many more Hutus than Tutsis and only a few thousand Twa (see Reference table 1 for population data). The often-quoted statistics—83% Hutu, 16% Tutsi, 1% Twa—are based on a Belgian census from the 1920s of dubious accuracy. There is a small expatriate trading, religious and humanitarian community.

Fewer than 8% of Burundian live in towns, compared with a Sub-Saharan African average of nearly 40%. Average population density is over 240 people per sq km, which is among the highest in Africa. There no reliable data on income distribution, but 20% of public spending is used to pay the salaries of 2% of the population. (See Reference table 2 for civil service labour force figures.)

Less than half the population have access to safe drinking water. Infant mortality is about 98 per 1,000 live births, compared with 138 in 1970. The birth rate is 43 per 1,000 and the death rate 17 per 1,000, roughly in line with the Sub-Saharan African average. Life expectancy is 50 years.

If peace returns, the World Bank estimates that population growth will slow from its current rate of 3% per year to 2% over 25 years leading to a population of 10.6m in 2020. If it does not, the Bank estimates that growth rates will climb to 3.7% per year over the same period, leading to a population of 14m in 2020.

Health

Events since 1993 have Burundi has 34 hospitals and around 270 health centres, a parastatal devastated the health pharmaceuticals manufacturing company and an innovative health insurance sector scheme. Drugs manufacture has collapsed since 1993 and the insurance scheme is barely functioning, owing to a combination of lack of resources and escalating demand.

Health provision is unevenly spread: for example, more than 70% of doctors work in Bujumbura. Since 1993 medical staff and patients across the country have been ensnared in the fighting, while the conflict has made it impossible for international aid agencies to operate at times. Displacement, war and growing poverty have worsened access to medical assistance and increased incidence of ordinary and life-threatening diseases, as well as malnutrition. In 1993 an estimated 6% of Burundi’s children were malnourished but regional studies conducted in 1996 and 1997 revealed a 20% rate.

At least 60 health centres have been completely or partially destroyed since 1993; previously there was one centre per 20,000 inhabitants, but today there is one per 25,000. In some provinces, such as Cibitoke and Bubanza, the destruction has been so bad that there are almost no health services left, while in others, such as Muyinga and Karuzi, there has been little change.

Sanctions increased the price of medicine and led to lower vaccination cover, which was over 80% before the crisis, despite the exemptions granted for the importation of health products in April 1997. Vaccination cover fell to under 50% in 1996 but has improved markedly since, largely because of international humanitarian efforts. The availability and price of medicines have still not returned to pre-sanctions levels, when health centres on average had 90% of the medicines they needed, in part because of declining government budgetary allocations in real terms. These allocations currently cover only 20% of the minimum needs of hospitals and health centres.

HIV rates are climbing fast In 1994 the rate of HIV infection was estimated at 15% in urban areas and 1% in rural areas. Three years later, the urban infection rate was estimated at 21% and the rural rate at 6% and in December 1998 the government put the overall rate at 20%. According to the government three-quarters of hospital beds nationwide are occupied by HIV/AIDS patients.

Education

About 35% of the population are literate. Primary school enrolment reached 70% in 1993, but had fallen to below 50% by 1998. Enrolment is below 30% in some provinces. The Sub-Saharan African primary school enrolment average is 65%. The fall in Burundi’s primary school enrolment is partly because of social disruption but also because of increased poverty. A 1990 survey found that schooling cost poor households less than 1.5% of their income, but in 1997 it

EIU Country Profile 1999-2000 © The Economist Intelligence Unit Limited 1999 Burundi 55

cost an estimated 4%, leading many to simply remove their children from school.

Almost all the primary education budget goes on salaries, leaving virtually nothing for infrastructural maintenance or school materials. Hundreds of primary school teachers have been killed or have fled their areas since 1993, and the percentage of remaining teachers who are qualified has fallen from 85% to 76%.

Secondary school enrolment levels have increased from 6% to 8% since 1993. University enrolment is stable at around 4,300 though the proportion of Hutus has fallen sharply, while enrolment in technical colleges has risen from 4,800 to 5,700 since 1993. These increases are because most secondary schools and tertiary education institutions are in Bujumbura, Bururi, Gitega, Muramvya and Ngozi provinces, which are among the least affected by the fighting. The increases are also because of the large subsidies provided by the government to secondary and tertiary education. Some 65% of state spending on education went on these sectors in 1997, compared with 53% in 1992.

Natural resources and the environment

Burundi is hilly and tropical with extensive marshlands and generally fertile land. Land has been overfarmed for more than a century, greatly diminishing yields. Each year sees substantial top soil loss, leading some environmentalists to predict that if current trends continue arable farming will become impossible within 20 years.

There are three crop seasons. The agatasi or A season, runs from September to mid-January, with the bulk of the rains falling from October to December. The next season, called the impeshi or B season, lasts from February to June, with most of the rain falling from March to May. The third season, the marshland or C season, is supposed to take place from July to September and is the best time for cash crops, vegetables and maize. Most planting is done in September and October, in time for the main rains. However rainfall patterns have been unpredictable in recent years.

Some 60% of the land is used for pasture and 25% is under cultivation. Land is either owned privately by peasant farmers, 80% of whom hold 1.5 ha or less, or is leased from the local commune. Burundi’s other main natural resources are peat and minerals including a substantial nickel deposit at Musongati.

Transport and communications

A battered transport Burundi has no railways and 5,162 km of road, 370 km of which are all- system weather routes. Burundi’s main export routes are by road to Mombasa in Kenya via Rwanda and Uganda, and to Dar es Salaam in Tanzania. The road to Mombasa is better, although the Tanzanian route crosses only one border. The Burundi transport parastatal, Otraco, is barely surviving. The once vibrant privately owned public transport sector has been harmed since 1993 by

increased insecurity on most routes, fuel price increases and by shortages of spare parts. (See Reference tables 3 and 4 for historical transport statistics.)

Deteriorating The government-owned Onatel has a monopoly on terrestrial telecommunications telecommunications but cell phones can be used in Bujumbura. There are services about 10,000 terrestrial telephone lines (3 per 1,000 people). There has been little telephone maintenance and no expansion since the war. Onatel is a prime potential candidate for privatisation but no decision by the government is expected soon. Burundi has one Internet service provider, the Centre Nationale d’Informatique (CNI), which became a private company in 1997.

The importance of radio Radio is Burundi’s main communications medium. There are three legal radio stations: Radio Burundi, Radio chambre du commerce et d’industrie du Burundi (CCIB) FM +, and Radio Umwizero (Hope). In addition the British Broadcasting Corporation (BBC) English and Kirundi language services are popular.

Radio Burundi is state-owned and government-controlled. Radio CCIB FM + is Burundi’s first legal privately owned radio station, but has close links with the Ministry of Commerce and is pro-government. It broadcasts for a few hours a day, within a 30-km radius of Bujumbura. Radio Umwizero was established in February 1996 by France’s former co-operation minister, Bernard Kouchner, and takes a less predictable stance on events than the other two stations. The Hutu militia-controlled Radio Democracy, which used to broadcast from Uvira in the Democratic Republic of Congo (Congo, formerly Zaire), has not been heard for some time. The station previously issued statements on behalf of the Conseil national pour la défense de la démocratie (CNDD).

Burundian television is state controlled and news bulletins invariably dwell lengthily on President Pierre Buyoya’s public appearances, followed by those of his cabinet ministers. Foreign news coverage is licensed from French television news.

Burundi’s main news agency is the state-owned Association Burundais de Presse. The independent Netpress agency, which tends to be critical of government attempts to negotiate with Hutu political groups, is often in trouble with the law and is suspended from time to time and its journalists’ harassed. The government newspaper is Le Renouveau. Most of the partisan newspapers have been banned since Mr Buyoya came to power in 1996.

Energy provision

Output is steady in spite of Around 93% of Burundi’s energy consumption is of wood, charcoal and peat, disruptions 6% of petrol products and 1% of electricity. Only 1.5% of the population have electricity in their households, while more than 90% of electricity is consumed in Bujumbura. Electricity consumption fell by 31% from 142m kwh in 1994, to 100m kwh, in 1996 but recovered to 140m kwh in 1998. Production reached its highest levels for many years in 1998 at 109.6m kwh, because of improvements in output at both the Mugere and Rwegura hydroelectric

EIU Country Profile 1999-2000 © The Economist Intelligence Unit Limited 1999 Burundi 57

stations. Poor rains look set to harm electricity production in 1999, with the Kayenzi hydroelectric dam particularly hard hit.

The embargo depressed fuel import and consumption levels during 1996 and 1997 and pushed prices up. However, imports and consumption levels recovered strongly in 1998 and the price dropped sharply, as the effectiveness of the sanctions regime steadily ebbed. Early indications are that fuel import and consumption levels in 1999 will be even higher, and will be more or less equal to those seen in 1994. (See Reference table 5 for historical energy data.)

Energy balance, 1998 (m tonnes oil equivalent)

Elec- Oil Gas Coal tricity Other Total Primary production 0.00 0.00 0.00 0.03a 1.35 1.38 Imports 0.04 0.00 0.00 0.01a 0.00 0.05 Exports 0.00 0.00 0.00 0.00 0.00 0.00 Primary supply 0.04 0.00 0.00 0.04a 1.35 1.43 Net transformationb 0.00 0.00 0.00 –0.03 0.00 –0.03 Final consumption 0.04 0.00 0.00 0.01c 1.35 1.40

a Expressed as input equivalents on an assumed generating efficiency of 33%. b Transformation input and output, plus energy industry fuel and losses. c Output basis.

Source: Energy Data Associates.

The economy

Economic structure

Main economic indicators, 1998

Population (m) 6.31 GDP growth (%) 4.5 Consumer price inflation (av; %) 17.0 Current-account balance ($ m) –33 Foreign debt ($ m) 1,200 Exchange rate (av; Bufr:$) 447.8 Source: EIU.

Around 92% of Burundi’s population live in rural areas and work the land. Subsistence agriculture accounts for about 50% of Burundi’s recorded GDP. Burundi is fertile—despite a century of overworking the soil—and was self- sufficient in food until 1993, but has been reliant on emergency relief since then. Commercial agricultural production, primarily of tea and coffee, contributes less than 5% of GDP, but generates over 95% of official export earnings. (See Reference table 5 for historical data on government finances.)

Burundi’s industrial sector, which consists of agricultural processing and food industries and a small selection of chemicals, textiles and construction manufacturers, and has been badly affected by war and sanctions. Manufacturing contributes less than 5% of GDP. Mining currently contributes a minute amount to national GDP but the picture could change dramatically if nickel mining from the Musongati deposit proceeds according to plan.

Gross consumption has been roughly equal to 100% of GDP for at least the last five years, with private consumption contributing between 85% and 95% of the total. Fixed investment has declined as a proportion of GDP in the same period, and was an estimated 7.2% in 1998. Private investment constituted only 2.2% of GDP in 1997 and 2.1% in 1998, which is one of the lowest percentages in Africa. The Sub-Saharan African average (excluding Nigeria and South Africa) was 14.2% in 1997. Gross domestic savings in 1998 were negative, and equivalent to -0.8% of GDP, mainly because of negative government savings. The Sub-Saharan African average in 1997 for savings as a proportion of GDP was 11.6%.

Comparative economic indicators, 1998

Burundi Ugandaa Tanzania South Africa UK GDP ($ bn) 0.9b 6.8b 8.3ab 117.7 1,387.0 GDP per head ($) 150b 322b 256ab 2,791 23,465 Consumer price inflation (av; %) 17.0 0.0b 12.8 7.0 2.6 Current-account balance ($ m) –33b –376b –563 –2,440 2,480 Merchandise exports fob ($ bn) 0.0 0.5b 1.0 28.0 271.1 Merchandise imports fob ($ bn) 0.1 1.2b 1.5 27.1 271.1 a Fiscal year starting July 1st 1998. b EIU estimate.

Source: EIU CountryData.

Economic policy

Burundi is small and land-locked, with few natural resources and a profoundly impoverished population, all of which presents a formidable economic challenge. Since October 1993 Burundi has suffered a vicious and debilitating civil war, frequent changes of government, two coup attempts (one of them successful), investor and aid donor flight, more than two years of regional sanctions, and proximity to a civil war in the Democratic Republic of Congo (Congo, formerly Zaire) which has drawn in Burundi and nearly all the country’s other neighbours.

There is consensus in Burundi that all economic improvements hinge on ending the civil war, or at least containing it, but no consensus over how to attain that goal. The government’s approach is to use Burundi’s armed forces to engage rebel militia on the ground both in Burundi and Congo, and to explore means of negotiating with their political leadership. Most small Tutsi parties reject negotiations. The political leadership of the Hutu rebel militia and its allies want the civil war to end with their overwhelming victory over Burundi’s armed forces.

Since 1996 Burundi’s armed forces have been relatively successful in containing The government is courting the civil war but their inability to end it has led to an almost complete absence foreign investment in of international investment and donor developmental assistance. The mining— government has responded by courting international investment in particular sectors, specifically mining, and an Australian mining company is now preparing to invest in the exploitation of Burundi’s nickel reserves (see Mining). It remains to be seen, however, whether the armed forces can guarantee sufficient security around its mining operations to secure the investment in the long term.

—while appealing for The government has attempted to attract back donor-funded developmental international development assistance by direct appeals to donors and trying to meet the conditions that assistance the donors have placed upon resuming their aid. The main condition donors have made is for there to be progress at the Arusha peace talks. The government has participated in the talks even though it privately and sometimes publicly doubts their effectiveness. Donors have not yet relented but probably will this year.

Burundi used to have one of the most dynamic industrial sectors in the region but it has been badly damaged by the events of the past six years. Short-term government policy is to control the allocation of foreign exchange through the Banque de la République du Burundi (BRB, the central bank) to ensure that sectors it considers strategic can keep going, but in the longer term it wants to build up Burundi’s foreign-exchange position so that it can relax these exchange controls. This will require donor-funded balance-of-payments support which is subject to the same conditions as development assistance.

Commercial agriculture is Burundi desperately needs to increase its export earnings. Earnings from tea due to be liberalised and coffee are currently depressed by low output, in part because of the effects of war but also because of the weak incentives offered to producers. The government intends to liberalise the commercial agricultural sector and reduce export taxes but is lagging behind the Rwandan and Ugandan governments in this regard. This has encouraged substantial smuggling, particularly of coffee, to Rwanda and Uganda.

Government policy is also to diversify the export base but this appears a remote dream at present. However, if nickel mining proves successful it will substantially increase overall earnings.

Government is trying to The government is committed to containing public expenditure and managed contain its spending— to reduce it from 28% of GDP in 1996 to an estimated 19% in 1998 despite maintaining high military spending levels. The main cuts have been in education and health expenditure, while total military spending increased from 5.4% of GDP in 1996 to 6.2% in 1997. The government has reduced its lending to parastatals but most remain unprofitable and a major drain on the public purse and government policy is to privatise them. However, progress on privatisation stalled in 1993 and has not resumed since then.

—but the economic Government attempts to increase revenue have been stymied by the decline in downturn has harmed import and export levels, since excise taxes, import and export duties revenue collection

contribute nearly 60% of the total. Government revenue fell from 15.5% of GDP in 1996 to an estimated 12.5% in 1998. (See Reference table 6 for money supply figures.)

The lack of aid has forced a Monetary policy since 1996 has been driven by the need to compensate for the lax monetary policy absence of foreign aid flows. Government has taken to borrowing from the central bank and Burundian private sector, and central bank credit to government in June 1998 was equivalent to 21% of the broad money supply in June 1997. Credit to the private sector has been easily available too, and the total money supply rose by an estimated 12.2% year on year in 1998. Real interest rates are negative, suggesting that stimulating Burundi’s savings levels is not high on the government’s list of priorities at present. (See Reference table 7 for historical data on interest rates.)

Burundi wants closer As long as regional sanctions were in place, it made little sense for Burundi to economic integration with pursue a policy of deeper economic integration with East Africa, but now that East Africa they have been lifted, the issue is once more on the agenda. Burundi has applied to join the East African Community (EAC) which comprises Uganda, Kenya and Tanzania, and the building designed to house the headquarters of the PTA bank in Bujumbura is nearly finished, despite the absence of a final decision about whether or not the bank will be sited there.

Economic performance

Gross domestic product (% real change, year on year)

Annual 1998 average 1994-98 GDP 4.5 –5.7 Source: EIU estimates.

Years of decline GDP growth was positive during the 1980s and early 1990s but sharply negative between 1993 and 1996. According to official statistics, Burundi recorded real growth of 0.4% in 1997 and 4.5% in 1998. Between 1993 and 1996 there were real declines in every sector. The greatest were in the secondary sector, particularly manufacturing and construction, but there were sharp falls in the real value of commercial activity and the production of export crops as well. The recovery in 1998 was the result of a 7% real increase in the value of officially recorded food production, while manufacturing barely registered any improvement and the value at constant 1980 prices of export crop production fell by a further 16% year on year. The value of official commercial activity increased by 2% in real terms during 1998. It is important to note, however, that one effect of the continued crisis in Burundi since 1993, and particularly of the sanctions between 1996 and 1999, has been a significant increase in unofficial and illegal economic activity that is not recorded in the available statistics.

Urban prices, Jun 1999

Unit Price (Bufr) $ Beer (Primus) 1 bottle 350 0.65 Coca-Cola 1 bottle 150 0.28 Soap (Lux) 1 bar 200-300 0.37-0.56 Oil (palm) 1 litre 350 0.65 Sugar 1 kg 440 0.81 Tomato 1 tin 200 0.37 Rice 1 kg 400 0.74 Chicken 1 live animal 3500 6.48 Kerosene 1 litre 350 0.65 Newspaper 1 issue 300 0.56 Cigarettes 1 pack (20 items) 300 0.56 Source: EIU.

Fixed investment as a proportion of GDP has declined in recent years (see Economic structure). Net foreign direct investment has been so low that the World Bank records it as 0.0% of GDP in 1993-97 with the exception of 1996, where it is estimated at 0.1%. The Sub-Saharan African average over the period was 0.6%. (See Reference tables 8 and 9 for historical GDP data.)

Inflation (% change; year on year)

Annual 1998 average 1994-98 Consumer prices 12.5 22.0 Source: EIU estimates.

The inflation rate triples Inflation averaged 7.2% between 1988 and 1993, but tripled in the following five years to an average of 22%. The price of food stuffs is the main determinant in the overall inflation rate in Burundi. Most food is locally produced and the increases in food prices have had markedly different effects in different regions. In communities which are net consumers of food staples the price increases have had a devastating effect, while those that have managed to sustain their food productive capacity have benefited from windfall profits. Overall, poverty incidence is growing. A World Bank study in 1997 put rural poverty at 58%, representing an 80% increase compared with 1993. The same study estimated urban poverty at 66%, twice its level five years earlier. (Reference table 11 shows historical inflation data.)

Regional trends

Cibitoke and Bubanza get Burundi is a small country of only 26,338 sq km, about 140 times smaller than poorer Congo. Karuzi, Kayanza and Bubanza provinces have the highest percentage of households below the poverty line and Cankuzo and Kirundo the lowest. Cibitoke and Bubanza, which used to be the richest provinces because of their agricultural productivity but which have been severely affected by the civil war,

have seen the biggest decline in their poverty profile. Rutana province, which has been only slightly affected by the war, has always been poor because of its inadequate soil and rains.

Bourgmestres are key to the Provincial governors, who are appointed by the president, are powerful. Many implementation of of the governors appointed by President Pierre Buyoya are military men whose government policy main job is security. Below them in the local government hierarchy are the communal bourgmestres, who are also appointed by the president although often on advice from others. These are the main enforcers and explainers of government policy, particularly in rural areas.

Economic sectors

Agriculture, forestry and fishing

Some 90% of the population are farmers, with women responsible for 70% of production. Burundi’s main subsistence crops are bananas, sweet potatoes, cassava, pulses, beans, sorghum and maize. Burundi was self-sufficient in food until 1993, but has depended on aid since, because of constant disruptions to the subsistence agricultural sector and the massive displacements endured by farmers. Most of Burundi’s refugees and internally displaced people are farmers and the civil war has been most intense in the main agricultural provinces, particularly Cibitoke, Karuzi and Bubanza.

Increasing soil infertility is diminishing crop yields. Growth in agricultural output in the 1980s was achieved by bringing new areas into cultivation, which masked declining yields, but by the end of the decade there was little new land available for arable use. Yields are declining because land is in such short supply that few can afford to leave fields fallow. Also, livestock herds have been reduced, resulting in a decline in the availability of manure for use as fertiliser. Commercial fertilisers are not readily available either, even though the sanctions have been lifted, because of a shortage of funds. Even before the crisis, in 1992, Burundi used less fertiliser per hectare than the Sub-Saharan African average. (See Reference table 12 for food crop production figures).

Comparative fertiliser use in Sub-Saharan Africa, 1992 (kg/ha)

Burundi Kenya Mali Rwanda Average Fertiliser use 3.7 22.1 9.2 0.8 14.9 Source: World Bank.

Coffee Burundi’s main cash crops are tea and coffee, supplemented by cotton, sugar, palm oil, pyrethrum, and tobacco. Almost all Burundi’s coffee is arabica, and is mostly grown on peasant small-holdings. Coffee output and quality has declined steeply over the past three years, mainly because of the civil war which has badly affected coffee growing regions and kept farmers away from

the crop. Also, sanctions and the international aid freeze have conspired to reduce the availability of fertilisers and other inputs.

Burundi’s coffee trees are generally old, and need replacing. Yields are low, ranging from 300 kg to 1 tonne per hectare. The Office des cultures industrielles du Burundi (Ocibu), the commercial agriculture parastatal, aims to replace them with varieties which in Kenya yield over 3 tonnes per hectare. Ocibu also wants to concentrate coffee production in areas most suited to it, primarily in the north.

Coffee producers are poorly paid, and so often either do not bother to cultivate much or have their crop smuggled to countries where prices are better. Burundi’s coffee producer prices went up by 28% in the 1998/99 season but even so, producers still only receive 33% of the international price compared with over 40% in both Tanzania and Uganda.

In keeping with the regional trend, the Burundian government plans to liberalise the sector. There has been no progress since 1993, although there is one private milling company with a small quota, and another is due to start soon. Burundi’s first private washing station was also seeking to open in 1999. Further liberalisation will mean job losses, which the government is reluctant to sanction without development assistance to cushion the blow.

Tea Some 7,900 ha are planted with tea in Burundi, of which 5,900 ha are family owned, with the balance in industrial blocks. Yields approached 5,000 kg/ha in 1994-95, but have since fallen back to under 4,000 kg/ha, mainly owing to war-induced neglect and a lack of inputs. Production dipped in 1996 and 1997 but has since recovered nearly to pre-war levels. Producer prices have remained constant at Bufr33/kg since 1995, while the export price (fob) has risen from Bufr318/kg in 1995 to Bufr550/kg in 1998. However, there is even less government urgency to liberalise the tea than the coffee sector.

Production and sales of dry tea (tonnes unless otherwise indicated)

1994 1995 1996 1997 1998 Production 6,864 6,985 5,648 4,169 6,669 Sales 6,236 7,461 4,668 5,049 6,059 Average price (Bufr/kg) 451 408 525 743 879 Source: Office du thé du Burundi.

Cotton Cotton production is controlled by two parastatals, the Compagnie de gerance du coton (Cogerco) and Coton et textiles du Burundi (Cotebu). In 1993 there were over 22,000 cultivators working just under 8,500 ha of land but in 1998 this had fallen to an estimated 17,000 cultivators on 3,600 ha, with the reductions again caused by the civil war. In 1998 production was estimated at 3,300 tonnes, a 39% increase on the year before but still only 37% of the 1993 crop. Meanwhile, the equivalent producer price for cotton fibre in 1998 was 48% of the export price, up from 40% in 1994.

According to UN Food and Agriculture Organisation (FAO) estimates, there Livestock and forestry were 390,000 cows, 320,000 sheep and 900,000 goats in Burundi in 1996. Livestock holdings are diminishing as increasing amounts of grazing land are turned over to arable use. During the 1980s deforestation was 2.7% per year— one of the fastest rates in Africa—and by 1993 forest cover was down to 7%. Deforestation has proceeded at an even faster rate since then, and forest cover is now estimated at only 5%.

Fishing Lake Tanganyika is the main source of fish. The fishing industry has declined since the crisis, with 22,000 tonnes of fish harvested in 1993 but only 3,000 tonnes in 1997. The main reason for this has been the periodic closure of Lake Tanganyika to fishermen for security reasons.

Mining and semi-processing

Burundi has deposits of nickel, cassiterite, phosphates, vanadium and gold. There are an estimated 185m tonnes of nickel-bearing deposits with an average grading of 1.31% at Musongati, Nyabikere and Waga. The deposits also contain an estimated 326m lbs of cobalt and 693m lbs of copper. The Australian junior mining house Andover signed an exploration deal with the Burundian government for the reserves in late 1998 which was ratified by the parliament in early 1999. Rebel militia have already begun targeting the Musongati area and security force deployments have been increased in response.

Manufacturing

The end of sanctions fails Industry is mostly geared towards agricultural processing, but also to halt the decline in manufactures beverages, cigarettes, chemicals (including soap), textiles and production some construction materials. Production declined in most sectors after 1993, and even more markedly with the advent of sanctions and the aid freeze in 1996. This was because their impact on Burundi’s foreign-exchange holdings reduced the flow of raw materials to industry, while the war, and the economic downturn that accompanied it, reduced the purchasing power of the domestic market. The end of sanctions in January 1999 improved the situation but because aid has not resumed, foreign exchange remains in short supply and industrial production has continued to fall, dropping by 10% between January and February 1999 alone.

Burundi’s traditional regional export markets for manufactured goods are Rwanda and the Democratic Republic of Congo (Congo, formerly Zaire). The collapse of Rwandan industrial production in 1994 increased demand for Burundian goods, and the local market for Burundi’s beer, in particular, is buoyant. Demand is also strong in Congo, although purchasing power is minimal and the war has disrupted supply routes.

Expansion initiatives are Initiatives to privatise manufacturing parastatals, expand manufacturing and on hold increase employment in the sector are on hold until security returns. The establishment of a free-trade zone in the early 1990s raised the possibility of

more manufacturing production, particularly in wood processing and possibly textiles, but there has been no substantial serious investment since 1994. (See Reference table 13 for historical data on manufacturing production.)

Financial services

The BRB is allocating Burundi’s central bank, the Banque de la république du Burundi (BRB), was foreign exchange to established in 1964. It sets the official exchange rate on instruction from the strategic sectors government, and since 1996 has allocated foreign exchange to importers according to its, and the government’s, assessment of the strategic value of the proposed imports. Since 1993 the BRB has relaxed its tight monetary policy targets, lending heavily to the government and allowing commercial banks almost unlimited refinancing opportunities. The BRB has changed its interest- rate policy as well. Real interest rates have been cut to the point where savings rates are negative in order to reduce the cost of both government borrowing and credit to commercial banks. Since the mid-1990s the BRB has ceased to regulate the commercial banking sector as tightly as it did before, and has been particularly lax over the issue of the level of commercial banks’ minimum reserve ratios.

BRB accounts, 1998 (Bufr bn)

Foreign assets 37.7 Credit to government 27.5 Credit to banks 13.7 Other 7.1 Total assets 86.0 Source: BRB.

The financial position of There are seven commercial banks in Burundi. The semi-autonomous Caisse de the banks has declined mobilisation et de financement (Camofi) was liquidated in late 1998 with debts of Bufr1bn ($2.2m). Its director at the time of the liquidation, the former prime minister Antoine Nduwayo, went on to establish the Banque de credit et de developpement (BCD) in March 1999. Government borrowing from commercial banks in the form of Treasury certificates has been rising, increasing from Bufr3.9bn in 1995 to Bufr17.9bn in 1997. Non-performing loans from commercial were estimated at 10% of the total in 1998, and most banks tend either to fail to meet the minimum reserve ratio or to come close to doing so.

Two institutions service Burundi’s rural population, the Coopérative d’épargne et de crédit (Coopec) and the Banque coopérative d’épargne et de crédit mutuel (BCM). Most Burundian farmers still obtain loans from money-lenders at extortionate rates.

Other services

Little tourism potential Apart from possible claims to the source of the Nile and the site where Stanley met Livingstone, Burundi’s natural tourism assets are limited. Its finest features for tourists are its people and culture, including its celebrated drummers. However, since 1993 only foolhardy backpackers have travelled to Burundi for their holidays. Retail trade, particularly in the capital, is dominated by expatriates, many of whom are of Greek or Lebanese descent.

The external sector

Trade in goods

Burundi’s merchandise The structure of Burundi’s merchandise trade has been unchanged since the trade balance is prone to colonial era. The country’s main exports are tea and coffee and its main extreme fluctuation imports are manufactured goods and fuel. The trend in the balance of merchandise trade has been an increase in the value of exports as a percentage of imports, although the percentage has also tended to fluctuate sharply from year to year. The value of the export of Burundi’s goods in 1998 was 48% of the value of its imports, which was nearly 10% lower than the average percentage for 1994-98. However, it was still 5% higher than the average percentage for the preceding five years. Figures for import values were fairly steady between 1989 and 1995, but fell by 40% in 1996 following the imposition of sanctions. However, since 1996, because of sanctions, the relationship between the figures and what was actually imported, has become more tenuous.

The international coffee The main factors affecting the value of Burundi’s exports are the size of its tea price largely determines and coffee crops and prevailing international prices for them. Between 1996 export value and 1998 there was the wild card of sanctions too, which meant that new ways had to be found to export tea and coffee, which increased transport costs and reduced export earnings. Of the other more long-term factors, only the volume of tea’s harvest and export has shown any consistency, growing steadily over the decade. All the other factors, and particularly the international price of coffee, have proved to be prone to dramatic annual fluctuations.

Principal exports and imports, 1998

Exports $ m Imports $ m Coffee 39 Capital goods 48.8 Tea 9 Fuel & energy 14 Manufactures 0.5 Food 10 Source: Burundi authorities.

The main determinants in the international price of coffee are the size of the Brazilian harvest, in which the extent of the annual frost is a major factor, and the effect that changes in the balance between global annual consumption and

production have on consumer stocks and hence market confidence. International stocks are nearly big enough to provide a whole year’s supply of coffee though, which acts as a permanent brake on a rise in the coffee price. However, periodically a production short fall will suddenly reduce stocks and frighten the markets, driving prices higher for a time, as happened last in 1997. Unfortunately at that point Burundi was still under sanctions and failed to profit from the windfall. Exports were worth only $87m that year. (See Reference table 14 for historical exports figures.)

Sanctions reduced fuel Burundi commercially imported substantial volumes of food in 1994 and 1995 imports but the figures are in its struggle to cope after the destruction visited upon its agricultural base by misleading the violence of 1993, but commercial food imports tailed off in 1996 and have remained low since. Energy imports also fell in value from 1996 onwards as a result of sanctions. Officially, Burundi spent $29m on petroleum products in 1994 and only $14.3m in 1998. However, but petroleum products were the main sanctions-busting commodity right through the embargo, and prices were often lower at the pump than official trade figures suggest they should have been. (See Reference table 15 for historical data in imports.)

Most regional trade is Most regional trade is hidden from official statistics and is hard to trace. It does hidden from the statistics seem, however, that sanctions helped erode Burundi’s former status in the region as a significant exporter and re-exporter of manufactured products, with Rwanda the principal beneficiary. Manufactured goods are still relatively easily available in Burundi compared with eastern Democratic Republic of Congo (Congo, formerly Zaire), and Burundi remains a key exporter to this region.

Burundi’s main international export markets are coffee consuming nations such as the UK and the former coloniser Belgium. Belgium is also Burundi’s main source of imported goods. (See Reference table 16 for Burundi’s trading partners from 1992-96.)

Main trading partners, 1996a

Exports to: $ m Imports from: $ m UK 5.0 Belgium-Luxembourg 19.0 Rwanda 3.0 France 11.0 Belgium-Luxembourg 1.0 Germany 11.0 Germany 1.0 Japan 8.0

a Based on partners’ trade returns; subject to a wide margin of error.

Source: IMF, Direction of Trade Statistics Yearbook.

Invisibles and the current account

The effect of lower imports Burundi runs a regular non-factor services deficit because of high freight and reduces the services deficit insurance costs and the expense of hiring foreign technical assistance and importing government services. However, technical assistance dried up after sanctions were imposed and freight and insurance costs came down along with the volume of imports. The effect was that Burundi’s non-factor service deficit

fell by 66%, to $26.8m, between 1995 and 1996. The deficit rose to an estimated $32m in 1998. Burundi’s limited non-factor services earnings are mainly derived from revenue from government services and foreign embassies inside the country. The earnings fell by $6m year on year, to $10m, in 1996, and by 1998 had fallen to an estimated $7.6m.

Burundi derives a limited income from investments, earning $4.3m in 1998. The main non-factor services costs are interest payments on foreign debt, which reached $10m in 1998.

Current account, 1998 (Bufr m)

Exports 10,437.7 Imports –16,245.9 Trade balance –5,983.5 Current-account balance –20,953.9 Source: Banque de la république du Burundi, Bulletin Mensuel.

Aid tailed off after 1996 Unrequited transfers, contributed by multilateral and bilateral donors in almost equal quantities, have traditionally stabilised the current account. In 1995 aid levels were sustained and the trade balance improved, leaving Burundi with a small current-account deficit, but aid levels plummeted in 1996, and the deficit that year was the same as in 1992. Aid levels have remained low since, despite government pleas for the funding to resume. (See Reference tables 17 and 18 for historical IMF and national balance-of-payments data.)

Capital flows and foreign debt

The current account deficit Burundi has financed its current-account deficit since 1996 by increasing its is financed by domestic domestic borrowing and by allowing arrears to grow on both domestic and borrowing foreign debt. Domestic debt increased by Bufr10bn to Bufr27.3bn in 1996 and by February 1999 had nearly doubled to Bufr51.6bn. Burundi was $13.5m in arrears on its foreign debt in 1995, but this figure rose to $38.2m in 1996 and $70m in 1998.

Capital account, 1998 ($ m)

Direct investment 0.0 Medium- & long-term official loans (net) 8.0 Other capital 0.0 Capital account balance 8.0 Balance of payments –25.3 Sources: Burundi authorities; IMF estimates and projections.

Foreign investment Burundi has never had much foreign direct investment (FDI), but volumes dwindles to nearly nothing dwindled to negligible levels in 1996. Burundi has reduced its borrowing since 1995, mainly because fewer sources are prepared to lend, and debt repayments

have almost cancelled out new loans since then, giving a low net figure. In 1998, for example, Burundi acquired $30m of new loans but amortised $22m in the same year, leaving the net loan figure at only $8m. Burundi is chronically Burundi is chronically indebted, with total debt standing at 130% of GDP in indebted 1996, although tailing off slightly to 123% by 1998. Over half the debt is owed to the World Bank’s International Development Agency (IDA). Most of the loans are concessional, with average interest rates of 1%, an 8.5-year grace period and an average maturity of 37 years. Total debt was only around 50% of GDP before Burundi adopted structural adjustment in 1996. (See Reference tables 19-21 for historical debt figures.)

External debt, 1998 ($ m)

Multilateral 960 of which: IDA 611 Bilateral 148 of which: France 59 Total incl others 1,200 Sources: Banque de la république du Burundi; World Bank.

Foreign reserves and the exchange rate

Burundi’s foreign reserves excluding gold plummeted after sanctions were imposed in 1996, falling from $209m in 1995 to just $65.5m at the end of 1998 because of the absence of fresh aid and loans to the country.

The Burundian franc is convertible against most regional currencies but not for hard currencies. Its official rate, set by the government and the BRB, averaged Bufr447.8:$1 in 1998. This represented a 30% depreciation year on year, largely because of a 43% fall in export earnings that year. (See Reference table 22 for historical foreign reserves data.)

A liberal foreign-exchange Exporters of non-traditional goods do not pay customs dues on imports and regime are entitled to a ten-year tax holiday. Dividends to shareholders, in Burundi and abroad, are untaxed. There are no limits on the repatriation of profits. Exporters of traditional goods such as tea or coffee, however, pay corporation tax of 45% and are subject to substantial restrictions on the repatriation of profit. (See Reference table 23 for historical exchange-rate data.)

Appendices

Regional organisations

Organisation of African The OAU was founded in 1963 by 30 African nations to promote solidarity and Unity (OAU) higher living standards, to defend the sovereignty of member states and to eliminate colonialism. Another 21 signatories have since joined, the last of which was South Africa in 1994. Morocco left in 1985. The OAU is committed to creating an Africa-wide customs union and to removing tariff and non-tariff barriers by 2004. The organisation has been criticised for a lack of decisive action, and has been hampered for years by severe budgetary problems.

The foreign ministers of member states meet twice a year to discuss the implementation of the organisation’s accords. The issues raised are dealt with at the annual assembly of heads of state, which meets in June or July. The annual conference is hosted by the member state that is due to take over the chairmanship of the organisation for the next year. The 1998 conference took place in Ouagadougou, Burkina Faso, where the Burkinabé president, Blaise Compaoré, assumed the chairmanship of the organisation. There have, in addition, been three extraordinary conferences of heads of state: the first was in 1970 to discuss the Angolan crisis; the second, in 1980, sought to address the continent’s economic problems; and the third, in 1990, attempted to address the problem of African debt.

The OAU is committed to the creation of an African economic community (AEC) according to the Lagos Plan of Action drawn up in 1980. This was originally scheduled to be in place by 2000, but at the 27th summit of heads of state in Abuja, Nigeria, in June 1991 this target was postponed to 2025. The AEC treaty, signed at the summit, outlined six stages, including the removal of tariff and non-tariff barriers to trade and the establishment of a continent-wide customs union by 2004. A commitment was also made to establish an African common market, with a central bank and single currency, by 2031.

The problem of conflict resolution has come to dominate the annual summit of heads of state. At the 1992 summit the OAU was criticised for never having successfully resolved a conflict in any of its member states. The possibility of establishing a military force to observe and monitor ceasefires negotiated by the OAU has been raised by several heads of state but no formal commitment has been made. The issue has been particularly pressing in the wake of renewed ethnic violence and border disputes since the mid-1990s, notably the Great Lakes crisis, the Ethiopian-Eritrean war, and the civil wars in Guinea-Bissau and Sierra Leone. The chaos and violence which followed the attempted secession of two islands from Comoros also remains unresolved.

Any move to step up the activity of the OAU is hampered by the organisation’s severe budgetary problems. In November 1995 the ten worst debtors, owing $16.5m between them, were debarred from speaking or voting at any OAU meeting. The return of full rights is conditional upon their paying a large part of their arrears.

The OAU remains a high-profile talking shop. Little real action results from its policy decisions, constrained as it is by limited funds and the varying levels of commitment of its members.

The Lomé Convention The Lomé Convention affords a group of 71 African, Caribbean and Pacific (ACP) countries preferential trade and aid links with the EU. The present convention (Lomé IV), which expires in February 2000, is being renegotiated.

Lomé IV was signed in 1989, replacing the previous agreements signed in 1975, 1979 and 1984. The convention maintained the long-term development aims of previous conventions, but placed new emphasis on economic policy reform in member states in line with the general emphasis on “conditionality” among multilateral funding bodies. After protracted negotiations between France (which wanted to increase total funding) and the UK and Germany (which sought to cut contributions and switch to bilateral aid), an agreement was reached in 1995 for total funding of Ecu14.6bn ($19.1bn at that time) until 2000, representing a 22% increase on the previous five years.

To achieve the Lomé objectives, a number of instruments were clearly defined in the convention. The most important was the European Development Fund (EDF), with an allocation of Ecu13.3bn. The EDF is the main source of multilateral EU aid to the ACP countries, and most of the funding is provided as grants. The remaining Ecu1.3bn was allocated to the European Investment Bank (EIB), which lends on a commercial basis. In addition, the ACP states gained a 16% cut in import tariffs on (mainly agricultural) products that did not previously enjoy preferential treatment. The convention also established two other separate schemes. The Stabilisation of Export Earnings Scheme (Stabex) was set up to cover losses of earnings caused by a fall in prices or a decline in production of the main ACP agricultural exports. Funding allocated to Stabex was increased by 62% to Ecu1.5bn under Lomé IV. Sysmin, a special financing facility for countries reliant on the export of minerals, was increased by 16% to Ecu480m. The schemes, however, suffer from a shortage of funds.

The convention has failed to bring about the intended growth in trade, since the share of ACP countries in the EU’s total imports fell from 6.7% in 1976 to 3.4% in 1997. Negotiations between the EU and the ACP countries on renewing the convention started in September 1998. The EU—in particular Germany and the UK—wants to reform the convention, whose preferential arrangements have come under increasing attack from the World Trade Organisation (WTO). (In 1997 the WTO ruled that aspects of the EU-ACP arrangement over banana imports were unfair, which contributed to an escalating trade dispute between the EU and the US in 1999.) At an EU-ACP meeting in Dakar in February 1999, the EU restated its position, which was to introduce a new conditionality emphasising good governance and to maintain the present arrangements between 2000 and 2004, replacing them with free- trade agreements over another period of ten years.

The ACP countries prepared a common negotiating position at a meeting in Libreville, Gabon, in October 1997, and expressed their preference for maintaining the status quo. They were opposed to the new governance conditionality, but indicated their willingness to phase out the preferential

arrangements—after a period of ten years. In addition, they resolved to boost intra-ACP co-operation, partly through organisations such as the Southern African Development Community (SADC). This would also fit the objectives of the EU, which wants to see greater regional integration among the ACP countries allowing it to negotiate separate sub-agreements within the Lomé Convention.

Common Market for The Common Market for Eastern and Southern Africa (Comesa), which is Eastern and Southern based in Lusaka, Zambia, is the successor organisation to the regional Africa (Comesa) Preferential Trading Area (PTA), and came into force on December 8th 1994 after 12 member states ratified the integration treaty. Comesa is a weaker rival to the Southern African Development Community (SADC) and includes Angola, Burundi, Comoros, the Democratic Republic of Congo (Congo, formerly Zaire), Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Madagascar, Malawi, Mauritius, Namibia, Rwanda, Seychelles, Sudan, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe. South Africa’s decision not to join the organisation, which aims to liberalise trade between the member countries, has given the SADC the stronger hand. Mozambique and Lesotho withdrew from Comesa in 1997 to concentrate on their membership of the SADC.

The original PTA, which was launched in 1981, aimed to liberalise trade and encourage co-operation in industry, agriculture, transport and communications. At a meeting in Lusaka in April 1997 the Comesa heads of state agreed that a common external tariff structure would be introduced to deal with all third-party trade by 2000. The main obstacles to successful integration are the unclear nature of the relationship with the SADC, most of whose members also belong to Comesa. Another constraint has been the strict “rules of origin”, which stipulate that preferential treatment can be granted only to goods produced by companies that are managed by, and 51% of whose equity is held by, nationals of a member state. Kenya and Zimbabwe originally argued strongly against this rule. The agreed schedule for removing customs barriers has frequently been revised. Comesa is to establish a free-trade area (FTA) by 2000 and all countries are supposed to have reduced tariffs by 80% as at October 1996. In fact, only six countries (Comoros, Eritrea, Sudan, Tanzania, Uganda and Zimbabwe) have reached this level; Kenya, Malawi and Mauritius have achieved 70% and are working towards the 80% level. All other countries, except Angola, Ethiopia and Congo, and those countries that still enjoy a derogation from publishing these tariffs (Swaziland and Namibia), have reduced tariffs by either 60% or 70%.

In general, commitment to the organisation and its financing is rather frail. The administration budget of approximately $4m is heavily dependent on Kenya and Zimbabwe and meetings are frequently cancelled. The civil strife in many member countries has also impeded attempts at regional integration. Further attempts at crossborder investment promotion, monetary harmonisation and the like have been superseded by EAC and SADC initiatives.

Under the old PTA a multilateral clearing facility was established in Harare, Zimbabwe, in February 1984. A PTA monetary unit of account (UAPTA), then

equivalent to the SDR, was used to settle debts between members every two months, the balances being payable in dollars. The 1997 heads of state meeting endorsed a proposal to replace the UAPTA with a Comesa dollar, fixed to the US dollar. Intra-Comesa trade accounts for only about 5% of members’ global trade. The reasons for this small share include the distortions arising from widespread crossborder smuggling, a lack of political commitment and weak balance-of-payments and foreign reserves positions. In some cases there are hardly any official trade links between member states, but a few countries (Kenya, Madagascar, Tanzania, Uganda, Zambia and Zimbabwe) account for 60% of total intra-Comesa trade. In 1997 Kenya alone exported over $1.5bn of goods to other Comesa countries, most of which went to Uganda and Tanzania.

A PTA Trade and Development Bank was established in 1986, but only became operational in 1989. Now renamed the Comesa Trade and Development Bank, its headquarters have been relocated from Bujumbura (Burundi) to Nairobi (Kenya). As well as the African Development Bank, 15 Comesa members hold shares in the bank; in December 1997 its total assets, including loans, amounted to $120m.

Sources of information

National statistical sources The main source of national statistical data is the Banque de la république du Burundi (BRB, the central bank). It publishes monthly, quarterly and annual bulletins (Bulletin mensuel, Bulletin trimestriel, Bulletin annuel) with an impressive range of data. Four-year comparisons are given for each set of statistics. As with any statistics about Burundi, the BRB’s data should be treated with caution because of the high proportion of the country’s economic activity that takes place in the parallel economy. Particularly suspect are any figures relating 1996 to 1998 because of the incentive sanctions provided to conceal economic activity. Figures on government spending also often overlook extra- budgetary spending. Finally, national and international statistics on prices and inflation are drawn from Bujumbura. Inflation is often higher elsewhere in the country.

International statistical The main sources for Burundi are the World Bank’s Global Development Finance sources and World Tables, the IMF’s Statistical Annex and International Financial Statistics, Energy Data Associates (1 Regent St, London SW1Y 4NR), and the International Coffee Organisation’s crop reports. All of these are primarily based on national data and are thus no more reliable than Burundian sources. Divergences are usually due to differences in definition, particularly in the case of the balance of payments.

Select bibliography Amnesty International, various, including, Burundi—Insurgency and counterinsurgency perpetuate human rights abuses, London, 1998

International Crisis Group, Burundi: Internal and Regional Implications of the Suspension of Sanctions, New York & Brussels, 1999

René Lemarchand, Burundi: Ethnocide as Discourse and Practice, Woodrow Wilson Center Press and Cambridge University Press, New York/Cambridge, 1994

René Lemarchand, Rwanda and Burundi, Pall Mall, London, 1970

Filip Reyntjens, L’Afrique des grands lacs en crise. Rwanda, Burundi: 1988-1994, Karthala, Paris, 1994

Filip Reyntjens, Burundi: Breaking the Cycle of Violence, Minority Rights Group, London, 1995

Internet sites Alertnet: http://www.alertnet.org (continuing series of articles on the humanitarian response to crises in the Great Lakes)

Amnesty International: http://www.amnesty.org

Human Rights Watch: http://www.hrw.org

International Crisis Group: http://www.intl-crisis-group.org

Médecins Sans Frontieres: http://www.paris.msf.org

(selection of historical articles about Rwanda and Burundi)

Burundi government: http://www.burundi.gov.bi

Association Burundais de Presse: http://www.cbinf.com

Ndadaye home page: http://www.altern.org/ndadaye/English.htm

Reference tables

These reference tables provide the most up-to-date statistics available at the date of publication.

Reference table 1 Populationa

1994 1995 1996 1997 1998b Population (m) 5.87 5.98 6.09 6.20 6.31 % change 1.7 1.9 1.8 1.8 1.8

a Mid-year estimates. b EIU estimate.

Source: IMF, International Financial Statistics.

Reference table 2 Civil service labour force

Teachers Total 1992 13,896 30,176 1993 14,540 31,046 1994 14,267 30,938 1995 14,666 31,606 1996 15,125 31,791 Source: Ministry of Public Service.

Reference table 3 Transport statistics

Freight volumes at Bujumbura port (m tonnes) Entering the port Leaving the port Total 1994 213.4 20.3 233.7 1995 180.4 31.5 211.9 1996 81.2 16.0 97.2 1997 70.9 28.1 99.0 1998 123.1 28.1 151.2 Source: Exploitation du Port de Bujumbura (EPB).

Passengers and freight at Bujumbura international airport

Arrivals Departures Freight Freight Passengers (tonnes) Passengers (tonnes) 1994 28,762 14,842 33,750 1,759 1995 33,472 4,639 36,420 1,847 1996 23,575 2,727 25,193 844 1997 7,841 10,552 7,787 15,339 1998 15,406 9,340 15,745 1,490 Source: Regie des Services Aeronautiques.

Reference table 4 National energy statistics (m kwh)

1994 1995 1996 1997 1998 Electricity production 75,615 98,781 97,713 84,210 109,681 Electricity consumption (Bujumbura) 129,504 117,827 90,365 118,824 123,720 Electricity consumption total 142,054 128,519 100,785 128,629 140,563 Source: Regideso.

Reference table 5 Government finances (Bufr m unless otherwise indicated)

1994 1995 1996 1997 1998 Total revenue 72,165 57,998 47,015 52,717 68,744 of which: grants 28,158 14,669 9,333 10,271 9,634 Total expenditure 74,347 63,415 66,776 69,495 84,712 of which: ordinary expenditure 37,492 37,306 43,917 53,345 58,966 capital expenditure 35,743 21,730 21,445 15,279 22,751 Overall balance –2179 –5417 –19,762 –16,777 –15,966 Financing External financing 8,408 7,290 15,4777 9,032 15,014 Internal financing –6,131 –3,214 –4,177 –4,938 –5,265 Source: Banque de la république du Burundi, Bulletin mensuel.

Reference table 6 Money supply (Bufr m unless otherwise indicated; end-period)

1993 1994 1995 1996 1997 Demand deposits (money banks) 14,721 19,095 18,730 18,038 22,235 Money (M1) incl others 31,300 40,146 n/a 43,642 48,203 % change year on year 12.0 28.2 n/a n/a 10.5 Quasi-money 10,482 15,549 n/a 17,857 19,089 Money (M2) 41,782 55,695 n/a 61,499 67,292 % change year on year 7.2 33.3 n/a n/a 9.4 Domestic credit 39,985 46,531 n/a 60,834 72,872 Claims on central government 2,096 5,788 n/a 14,587 26,220 Claims on non-financial public sector 2,902 3,844 n/a 3,593 3,550 Claims on private sector 33,381 36,117 n/a 40,138 42,830 Claims on other financial institutions 1,607 782 n/a 2,516 273 Net foreign assets 34,621 45,198 n/a 47,217 46,352 Source: IMF, International Financial Statistics.

Reference table 7 Interest rates (% per year; average)

1994 1995 1996 1997 1998a Loans 15.0 15.5 15.5 16.0 17.6 Short-term 15.0 15.6 15.5 16.1 17.7 Medium-term 15.2 15.0 15.3 15.8 17.8 Long-term 14.7 14.8 15.1 14.5 15.4 Deposits 9.1 8.4 8.4 8.5 9.1 Instant access 3.4 4.3 3.9 4.8 5.9 One year 9.6 9.5 8.8 9.3 9.9

a Provisional.

Source: Banque de la république du Burundi, Bulletin mensuel.

Reference table 8 Gross domestic product (Bufr bn, unless otherwise indicated)

1994 1995 1996 1997 1998 At current prices 251.8 301.8 265.4 346.1 404.4 At constant (1980) prices 123.7 115.0 105.1 105.5 110.2 Real change (%) –3.0 –7.0 –8.6 0.4 4.5 Per head (Bufr m) 42.9 50.5 43.6 55.8 54.8 Sources: IMF, International Financial Statistics; EIU.

Reference table 9 Gross domestic product by expenditure (Bufr bn; current market prices)

1994 1995 1996 1997 1998 Private consumption 241.7 280.8 209.5 297.2 363.3 Government consumption 28.0 28.2 45.4 52.1 64.7 Gross fixed capital formation 24.5 28.9 32.7 22.0 24.0 Exports of goods & services 24.0 32.2 14.7 32.7 31.9 Imports of goods & services –66.6 –68.2 –40.9 -48.4 –77.6 Change in stocks 0.0 -0.2 4.0 -9.4 –1.9 GDP 251.8 301.8 265.4 346.1 404.4 Source: IMF, International Financial Statistics.

Reference table 10 Gross domestic product by sector (Bufr m, 1980 prices; % change year on year in brackets)

1993 1994 1995 1996 1997 Primary 66,312 59,508 55,916 56,734 59,154 (–4.1) (–10.3) (–6.0) (1.5) (4.3) Secondary 14,775 13,841 11,468 9,953 10,744 (–16.4) (–6.3) (–17.1) (–13.2) (7.9) Tertiary 35,686 34,548 33,042 29,275 29,823 (–2.3) (–3.2) (–4.4) (–11.4) (1.9) Indirect taxes 10,617 14,809 13,364 8,315 9,094 GDP at market prices 127,390 122,705 113,790 104,277 108,815 (–5.9) (–3.7) (–7.3) (–8.4) (4.4) Sources: Ministry of Finance; IMF.

Reference table 11 Prices and wages 1994 1995 1996 1997 1998 Consumer price index (1995=100) 83.8 100.0 126.4 165.8 186.5 % change 14.8 19.3 26.4 31.2 12.5 $ per day Urban areas a 0.63 0.64 0.53 0.45 0.37 Rest of country 0.42 0.42 0.35 0.30 0.24

a Bjumbura and Gitea.

Source: IMF, International Financial Statistics; Ministry of Labour.

Reference table 12 Food and cash crop production (‘000 tonnes)

1994 1995 1996 1997 Bananas 1,269 1,421 1,544 1,507 Sweet potatoes 601 674 670 680 Cassava 527 501 549 558 Beans, dry 232 319 288 280 Maize 123 153 144 162 Rice 38274238

1994 1995 1996 1997 1998 Coffee 39,872 24,164 17,933 17,329 16,338 Tea 6,864 6,985 5,648 4,169 6,669 Cotton 4,915 4,593 2,605 2,381 3,300

a Crop years (April-March) starting in year stated.

Sources: UN Food and Agriculture Organisation (FAO), Production Yearbook; Banque de la république du Burundi, Bulletin mensuel; IMF

Reference table 13 Selected manufacturing production

1994 1995 1996 1997 1998 Primus beer (hectolitres) 1,187,058 1,148,948 997,188 983,680 820,942 Flour (tonnes) 2,348 472 497 n/a n/a Milk (litres) 1,128,63538 5,398 594,875 254,128 288,367 Oxygen (cu metres) 33,636 29,119 26,195 30,049 31,876 Soap (kg) 5,292,349 5,261,757 3,111,381 2,431,595 3,415,145 Cloth (m sq metres) 4.6 4.0 4.5 5.0 7.0 Cigarettes (‘000 packets) 584,5805 22,484 449,860 377,145 316,820 Source: Banque de le république du Burundi, Bulletin mensuel.

Reference table 14 Exports (Bufr m)

1994 1995 1996 1997 1998 Total exports 30,034 25,982 11,373 30,767 28,635 of which: coffee 23,710 20,175 7,642 26,982 22,858 tea 2,741 2,340 1,641 3,176 4,912 manufactures 1,378 1,755 1,295 160 402 Source: Banque de la république du Burundi, Bulletin mensuel.

Reference table 15 Imports (Bufr m)

1994 1995 1996 1997 1998 Pharmaceutical products 3,606 3,032 2,038 3,751 4,504 Gas oils 2,688 2,758 2,699 2,759 3,686 Vegetables 1,742 1,345 661 275 946 Cement 1,369 1,232 1,096 1,385 2,522 Vegetable oils 1,050 440 205 222 562 Wheat flour 1,014 1,016 617 1,006 1,767 Total imports incl others 56,468 58,200 37,332 43,249 70,275 Source: Banque de la république du Burundi, Bulletin mensuel.

Reference table 16 Main trading partnersa ($ m)

1992 1993 1994 1995 1996 Exports to: Belgium-Luxembourg 2 2 1 2 1 Germany 116941 Rwanda 63223 US 6 – – – – UK 41829305 Imports from: Belgium-Luxembourg 33 34 30 36 19 France 25 24 25 23 11 US 9 4 8 11 6 Germany 1714121911 Iran 10 13 16 3 –

a Based on partners’ trade returns; subject to a wide margin of error.

Source: IMF, Direction of Trade Statistics Yearbook.

Reference table 17 Balance of payments, IMF estimates ($ m)

1993 1994 1995 1996 1997 Goods: exports fob 73.9 80.7 112.5 40.1 87.3 Goods: imports fob –172.8 –172.6 –175.6 –100.0 –97.9 Trade balance –99.0 –91.9 –63.1 –59.9 –10.6 Services: credit 14.6 14.9 16.4 10.5 8.7 Services: debit –114.8 –93.9 –101.2 –38.4 –41.3 Income: credit 11.2 8.1 10.4 6.4 4.3 Income: debit –22.2 –19.5 –22.9 –20.4 –16.8 Current transfers: credit 183.8 167.0 154.7 62.5 61.3 Current transfers: debit –1.8 –1.6 –2.1 –1.1 –1.6 Current-account balance –28.1 –16.9 –7.8 –40.3 4.0 Net direct investment 0.5 0.0 2.0 0.0 0.0 Net portfolio investment 0.0 0.0 0.0 0.0 0.0 Financial balance 52.5 31.1 21.0 14.1 14.0 Capital-account balance –1.2 –0.2 –0.8 –0.3 –0.1 Errors & omissions –7.2 21.1 24.2 –8.9 –7.1 Overall balance 16.0 35.2 36.7 –35.3 10.8 Financing (– indicates inflow) Movement of reserves –11.9 –29.0 –27.6 44.0 –2.5 Use of IMF credits and loans –4.1 –6.1 –9.0 –8.7 –8.3 Source: IMF, International Financial Statistics.

Reference table 18s Balance of payments, national estimates (Bufr m)

1994 1995 1996 1997 1998 Merchandise trade balance –1,840 –6,237 –20,489 –9,779 –22,754 Services balance –9,282 –2,532 –11,890 –14,632 –21,542 Unilateral transfers 21,560 21,065 16,133 18,427 23,341 of which: bilateral 6,251 8,089 6,137 7,929 11,429 multilateral 9,159 9,139 5,916 8,525 9,365 Capital movements –804 39.2 –52.0 –1,965 –4,362 Errors & omissions –444 3,372 2,501 –1,838 –662 Overall balance 9,633 6,593 –13,095 –9,986 –26,009 Source: Banque de la république du Burundi, Bulletin mensuel.

Reference table 19 External debt, World Bank estimates ($ m unless otherwise indicated)

1993 1994 1995 1996 1997 Long-term debt 998 1,062 1,095 1,081 1,022 Official creditors 995 1,060 1,093 1,080 1,021 Multilateral 817 881 926 921 872 Bilateral 179 179 167 159 149 Private creditors 3 2 2 1 1 of which: banks 0 0 0 0 0 Use of IMF credit 58 56 48 38 28 Short-term debt 5 6 15 8 16 of which: interest arrears on long-term debt 1 1 2 5 9 Total external debt 1,061 1,123 1,158 1,127 1,066 Total debt service 36 41 39 31 29 Principal 23 28 27 21 20 Interest 13 13 12 10 9 of which: short-term debt 1 1 1 0 0 Ratios (%) Total external debt/GNP 110.0 123.1 117.2 127.1 112.5 Debt-service ratio 36.2 39.5 27.7 53.5 29.0 Short-term debt/total external debt 0.5 0.5 1.3 0.7 1.5 Concessional debt/total external debt 89.1 90.1 90.4 92.3 92.8 Source: World Bank, Global Development Finance.

Reference table 20 Public-sector debt (Bufr m)

1994 1995 1996 1997 1998a Internal debt 13,489 17,695 27,357 39,959 43,758 Banking sector 12,580 13,929 22,339 34,974 34,104 Other financial institutions 43 0 98 460 1,088 Other 867 3,766 4,919 4,555 8,566 External debt 265,129 306,169 353,080 424,239 555,752 Multilateral 224,380 260,173 301,728 363,109 475,784 Bilateral 40,183 45,552 51,079 60,857 79,341 Other 566 443 273 272 628 Total 278,618 323,864 380,437 464,198 599,510

a Provisional.

Source: Banque de la république du Burundi, Bulletin mensuel.

Reference table 21 Net official development assistancea ($ m)

1993 1994 1995 1996 1997 Bilateral 125.7 108.5 108.4 67.8 38.2 of which: Germany 25.4 27.7 30.9 13.8 6.1 France 28.5 23.0 17.5 13.0 5.9 Belgium 26.3 19.2 9.5 6.8 4.9 US 18.0 10.0 23.0 2.0 3.0 Japan 8.2 7.4 4.1 1.0 0.0 Multilateral 95.0 207.5 183.4 137.2 81.4 of which: UNHCR 0.0 65.9 99.0 81.8 57.4 WFP 5.0 64.2 16.5 10.3 0.0 EU 24.0 36.5 23.9 9.9 2.9 IDA 34.6 25.5 24.5 13.9 7.4 Total 218.4 313.0 289.0 203.8 119.3 of which: grants 170.2 293.0 274.1 194.7 127.4

a Disbursements minus repayments. Official development assistance is defined as grants and loans with at least a 25% grant element, provided by OECD and OPEC member countries and multilateral agencies, and administered with the aim of promoting development and welfare in the recipient country.

Source: OECD, Geographical Distribution of Financial Flows to Developing Countries.

Reference table 22 Foreign reserves ($ m unless otherwise indicated)

1994 1995 1996 1997 1998 Foreign exchange 195.94 200.67 131.06 105.07 57.18 SDRs 0.21 0.07 0.11 0.06 0.09 Reserve position in the IMF 8.56 8.71 8.43 7.91 8.25 Total reserves excl gold 204.70 209.45 139.60 113.04 65.52 Gold (national valuation) 6.59 6.66 6.36 4.99 4.95 Memorandum item Gold (m fine troy oz) 0.017 0.017 0.017 0.017 0.017 Source: IMF, International Financial Statistics.

Reference table 23 Exchange rates (period averages; per unit of currency)

1994 1995 1996 1997 1998 Bufr:$ 252.66 249.76 302.75 352.35 447.77 Bufr:£ 387.0 394.2 472.8 577.0 741.7 Bufr:SDR 361.73 378.89 439.5 484.8 630.5 NUSh:Bufr 3.88 3.88 3.46 3.07 2.77 Bufr:KSh 4.51 4.86 5.30 6.00 7.42 Source: IMF, International Financial Statistics.

Editor James Walker All queries Tel: (44.171) 830 1007 Fax: (44.171) 830 1023