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6 Rwanda In 2011, Rwanda’s GDP grew by an impressive 8%, while inflation stayed below double digits. Growth was largely driven by the service and agricultural sectors, which contributed 43% and 42% of GDP, respectively. The industrial sector also showed robust growth (particularly mining), contributing 14% of GDP. The government continues its efforts to diversify and transform the economy into a knowledge-based one focused on high value transformation and services, jobs and incomes. Rwanda also promotes productive sectors like agriculture, mining, and tourism, to further reduce donor dependency and improve its trade balance. The Government is continuously improving Rwanda’s infrastructure.
<strong>SNV</strong> Rwanda 2011 7 Despite the progress made to date, an estimated 56% of Rwandans still live below the poverty line. The economy is very dependent on subsistence agriculture, which contributes about 34% of GDP, 80% of employment and 50% of exports. Some segments of the rural poor still experience water and food uncertainty, with food insecurity affecting 21% of Rwandans. Rwanda has a high population density (384 inhabitants/km2) and a low urbanisation rate. Measures have been put in place to stimulate agricultural intensification and to address environmental challenges related to the high pressure on resources such as land and water. High levels of investment are still required in order to achieve the agricultural transformation. Key labour market skills are also lacking—almost 75% of Rwanda’s labour force is unskilled, and less than 10% of its working population is educated beyond primary level. Expensive energy and high transport costs, relative to its neighbours, raise the costs of doing business in Rwanda. Despite t h i s , Rwanda continues to climb up the ‘doing business’ list and is now ranked 50 (was 58 in 2010). The country scores particularly high with respect to starting a business, fiscal procedures, property registration, access to credit, and international commerce. The third phase of the decentralisation process is underway, and seeks to strengthen district level service delivery and local economic development. Local actors are encouraged to participate actively in identifying and removing barriers to development.
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