The Political Settlement and 'deals environment' in Rwanda: Unpacking two decades of economic growth

Pritish Behuria, Tom Goodfellow

Research output: Working paper

Abstract

This paper explores the political economy of growth in Rwanda during two decades
of economic expansion under the Rwandan Patriotic Front (RPF). It builds on recent
work emphasising the importance of party-owned enterprises in sustaining this
progress, but goes further by analysing state-business dynamics in four key sectors
of the economy: coffee, mining, construction and financial services. For each sector,
the evolution of the ‘deals environment’ (Pritchett and Werker 2012) is detailed and
the differential degrees of growth, liberalisation and foreign competition are
explained. This detailed sectoral analysis enables us to develop a deeper
understanding of how political concerns have affected Rwanda’s economic growth
trajectory. The paper argues that while the Pritchett-Werker framework is a helpful
starting point, the ‘deals environment’ in Rwanda has not progressed along a linear
trajectory from ‘closed disordered’ to ‘open ordered’ deals as posited in the model.
Instead, the maintenance of growth has involved the cultivation of carefully protected
pockets of ‘closed’ deals in strategic nodes of different sectors. Moreover, the
combination of rapid economic liberalisation with politically motivated ‘closed’ deals
has led to a degree of continued (or renewed) disorder in some sectors, which may
yet threaten growth in the long term.
Original languageEnglish
Place of PublicationManchester
PublisherEffective States and Inclusive Development Research Centre
Pages1-41
Number of pages41
Publication statusPublished - Apr 2016

Keywords

  • Rwanda
  • Economic Growth
  • Political settlement
  • Deals
  • Coffee
  • Mining
  • Construction
  • Financial services

Research Beacons, Institutes and Platforms

  • Global Development Institute

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