KIGALI, RWANDA - Rwanda's Central Bank is designing a financial instrument that aims at attracting the country's nationals living abroad to invest in the economy.
The 'Diaspora Bond', according to Central Bank Governor Claver Gatete should be rolled out this year.
"We want to make it really a competitive bond," Gatete said in an interview late last year, adding, "We are looking at experiences of other countries in Africa and beyond trying to see how we can design it. We want it to be completed and be on the market during the course of 2012."
Like investing in other Government backed bonds, investing in the Diaspora bond means that Rwandans living abroad will be lending money to the Central Bank by buying the bond and they will get interest plus their money back in a certain period.
Gatete said the size, interest rate and the maturity period of the bond would be communicated when the bond is ready for the market.
The Bond is also an avenue for the Diaspora living troubled economies such the U.S and European countries where return on investment is uncertain.
Gatete said investing in the 'Diaspora Bond' is risk free since it is fully guaranteed by the Central Bank. "This bond is completely guaranteed by the Central Bank. We want to design it in such a way that they [Diaspora] can feel safe and comfortable and look at it as a profitable instrument where they can invest in."
Rwanda, like other African countries, has thousands of its nationals living in different parts of the world and they are increasingly sending back money.
According to the Central Bank statistics, Rwandans living abroad sent back an estimated US$140.25 million in 2011 from $98.2 million in 2010.
This clearly shows a steady increase in their contribution to the rebuilding of the country that was almost brought down to its knees by the civil war and subsequent 1994 Genocide .
The Government, which is ambitiously looking for all possible avenues to increase domestic investments, through the Central Bank, is keen to tap into the increasing Diaspora cash to boost economic growth and the welfare of the Rwandans.
Rwanda, unlike other East African countries, has guarded well its economy over the past year against high inflation and other external shocks.
Inflation was still in a single digit at 7.76% in November while it had been projected to hit 8.2% in December.
The economy was projected to grow by 8.8% end of 2011 and according to all quarters of the year, performance in all sectors was better and this gives optimism that Rwanda might meet growth expectations.
Final figures for the inflation and economic growth for 2011 are yet to be published.
This year, the economy is expected to grow around 7.6%, according to news reporting quoting Mr. Gatete as saying.
European countries where return on investment is uncertain.
Gatete said investing in the 'Diaspora Bond' is risk free since it is fully guaranteed by the Central Bank. "This bond is completely guaranteed by the Central Bank. We want to design it in such a way that they [Diaspora] can feel safe and comfortable and look at it as a profitable instrument where they can invest in."
Rwanda, like other African countries, has thousands of its nationals living in different parts of the world and they are increasingly sending back money.
According to the Central Bank statistics, Rwandans living abroad sent back an estimated US$140.25 million in 2011 from $98.2 million in 2010.
This clearly shows a steady increase in their contribution to the rebuilding of the country that was almost brought down to its knees by the civil war and subsequent 1994 Genocide .
The Government, which is ambitiously looking for all possible avenues to increase domestic investments, through the Central Bank, is keen to tap into the increasing Diaspora cash to boost economic growth and the welfare of the Rwandans.
Rwanda, unlike other East African countries, has guarded well its economy over the past year against high inflation and other external shocks.
Inflation was still in a single digit at 7.76% in November while it had been projected to hit 8.2% in December.
The economy was projected to grow by 8.8% end of 2011 and according to all quarters of the year, performance in all sectors was better and this gives optimism that Rwanda might meet growth expectations.
Final figures for the inflation and economic growth for 2011 are yet to be published.
This year, the economy is expected to grow around 7.6%, according to news reporting quoting Mr. Gatete as saying.
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