Rwanda has made significant social and economic progress over the past 20 years. Building on an elaborated set of long- and medium-term development strategies the country has maintained economic growth on average at rates of 5-10% since 1995 and achieved a large part of the Millennium Development Goals (e.g. education, health, and missing MDG1 only slightly).
At the outset of this positive development trajectory following the end of the genocide in 1994, Rwanda was highly dependant on Official Development Assistance, which, although significantly reduced by 2014 still makes up close to 40% of the national budget. In addition, in 2015, about 15% of external resources stemmed from South-South and Non-DAC cooperation.
The large number of development partners and of funds dedicated to specific development purposes required substantive management efforts from the young administration and has driven the set up for an innovative development finance coordination architecture in order to ensure that external finance is aligned to and promotes national development priorities. Up to now this architecture inspires countries and development partners in the region.
A pioneer in development effectiveness on the continent, Rwanda has a well-established National Aid Policy (2006) and development cooperation architecture, including a sound mechanism for assessing the performance of development partners (DPAF) which takes place annually. Performance is measured against 14 effectiveness indicators in line with the national Aid Effectiveness Action Plan and the global effectiveness agenda (Paris Declaration, Busan Monitoring Framework). This review is published together with the review of the Government performance, which is is assessed annually in line with the national development strategy.
The DPAF and the Division of Labour (DoL) between development partners (DPs), which requires that DPs work in no more than 3 sectors, have been instrumental in introducing a behavioural change among DPs.
A cabinet-level Aid Policy Implementation Committee provides high-level oversight and strategic direction in the area, while the Development Partners Coordination Group brings together the Governments, DPs, CSOs and private sectoral for high level dialogue. At the sectoral level, the dialogue between the government and partners is organized through Sector Working Groups (SWGs) which are jointly lead by a lead ministry and a DP.
Through its Development Assistance Database (DAD) the government collects official development finance data from development partners and publishes annual official reports .
In view of the shifts in the development finance landscape over the past years and an increasing share of South-South and private sector resources, the Government of Rwanda has proactively developed its South-South Co-operation Policy, is working on the implementation of a private sector financing strategy and on the development of a new DPAF that can measure "beyond aid partnerships" in the areas of trade, taxation, FDI, PPPs, etc.
Rwanda has willingly shared lessons learnt from the implementation of these development finance management tools with other countries. Every year the Ministry of Finance and Economic Planning hosts delegations from peer ministries to learn about best practices in making sure effectiveness principles are respected at national level. To name only a few, delegations from Bangladesh, The Gambia, Malawi, Sudan and Madagascar have visited Rwanda's aid management institutions and learned about best practices to ensure coordination, alignment and results to national development priorities and the monitoring and accountability of DP interventions.