Rwanda plans a 20% spending surge in 2025/26 as growth slows from 8.9% in 2024 to 7.1%, with big bets on domestic revenue and external financing.

Rwanda’s Finance Minister Yusuf Murangwa stood before parliament on Thursday, unveiling an audacious budget proposal that defies the gravity of slowing economic growth. Despite a projected dip in GDP to 7.1% in 2025—down from last year’s robust 8.9%—the government plans to increase public spending by a staggering 21%, signaling confidence in the country’s long-term trajectory.

“We are investing in the future,” Murangwa told lawmakers during his presentation of the draft 2025/26 budget.

Growth May Dip—But Confidence Doesn’t

Rwanda’s economy, long a model for stability and post-conflict resilience, is projected to rebound with 7.5% growth in 2026, followed by 7.4% in 2027, and 7.0% in 2028, according to the Finance Ministry’s forecasts.

No official explanation was offered for the projected slowdown in 2025. Still, global economic tremors, regional instability, and climate-linked risks are likely contributors.

An Ambitious Fiscal Blueprint

Murangwa’s proposed spending plan totals 7.03 trillion Rwandan francs ($5.01 billion) for the fiscal year starting July 2025—up from 5.82 trillion francs in the current cycle.

Where the Money Comes From:

• 4.11 trillion francs from domestic revenues
• 2.15 trillion francs in loans
• 585.2 billion francs from external grants

The minister did not break down the type of loans—whether they will come from multilateral lenders, bilateral partners, or commercial markets.

Rwanda’s Economic Engine: Still Running Strong

Agriculture, tourism, and manufacturing continue to be the backbone of Rwanda’s economy. Investment in these sectors, alongside infrastructure and technology, has helped position Rwanda as one of Africa’s fastest-growing economies.

But even Kigali is not immune to the pressures of rising global debt costs, fluctuating aid flows, and geopolitical uncertainties.

A Calculated Bet on the Long Game

Rwanda’s fiscal playbook has always emphasized discipline, but this year’s budget reveals a more aggressive push to accelerate structural transformation. With Vision 2050 as a guiding compass, the government seems intent on funding critical development—despite a temporarily softer growth curve.

If Murangwa’s numbers hold and Kigali can effectively deploy its capital, Rwanda may once again prove that small nations can make big economic leaps—with the right mix of strategy, discipline, and daring.

Here’s a visualization of Rwanda’s national budget growth from 2021 to 2026, showing the sharp rise projected in the 2025/26 fiscal year as Finance Minister Yusuf Murangwa stated on May 8, 2025.