News Analysis: Rwanda Losing International Financial Assistance?
Monday, 30 July 2012
Several Western countries have withheld financial support to Rwanda in the wake of allegations that the country had supported the mutiny in Eastern DRC:
  • First, the US have suspended USD200,000 in military financial assistance – an insignificant sum that has symbolic rather than material impact.
  • The UK has suspended the disbursement of USD25m in budget support that had been due in July 2012. The UK is one of Rwanda’s largest donors.
  • According to the FT, ‘Nordic countries and India on the board of the African Development Bank have meanwhile forced a one-month delay in the disbursal of USD38m in budget support while they pore over the allegations.’
  • The Netherlands have suspended USD6m in aid.
Allegations Against Rwanda
On his Congo Siasa blog, DRC expert Jason Stearns summarises some of the evidence against Rwanda as outlined in the UN Security Council Report:
The report deals exclusively with Rwandan support to armed groups and sanctioned individuals in the eastern Congo, and the findings are extremely damning. The Group finds that Rwanda is providing extensive support not just to the M23 rebellion, but to six other armed groups in the eastern Congo. (…) However, most of these other groups are either barely alive or not (yet) very important. As in the case with the CNDP, the outreach efforts have not gained much traction. The main group is still the M23.’

But when it comes to the M23, the allegations are hard-hitting. The support they document consists of providing ammunition and guns, health care, training, and new recruits. They also provide details of meetings organized by top Rwandan officials, including senior defense ministry representatives, to mobilize Congolese business and politicians to join M23. They claim that the Rwandan government has used its demobilization commission networks to mobilize ex-combatants, many of whom used to fight in the FDLR, as well as allowing recruitment to happen in the refugee camps largely populated by Congolese Tutsi. Most egregiously, they report that Rwanda has sent its own army into the Congo to support the mutiny on several occasions.

The Group names individuals within the Rwandan government by name, saying that the following people played key roles: Defense Minister General James Kabarebe, the Defense Forces Chief of Staff General Charles Kayonga, the Permanent Secretary of the ministry of Defense General Jack Nziza, and Rwandan army division commander General Emmanuel Ruvusha. These officers have attended mobilization meetings, been in direct contact with mutineers, and have been seen organizing logistical support to the M23.’
Stearns also notes the higher than usual standards for the quality of the evidence:
‘The Group usually requires three independent and reliable sources to make a claim. In this case, however, given the severity and importance of the allegations, they say they rely on at least five such sources. Most of the evidence is eye-witness testimony - they interviewed 80 deserters from these various armed groups, including 31 Rwandan nationals, along with senior Congolese army and intelligence officers and active members of the various armed groups. They have some documentary evidence, including internal Congolese army reports and radio intercepts, as well as pictures of M23 weapons and ammo that are not in Congolese army stocks.’
Rwanda’s government has reacted with furious denials to the allegations (see their rebuttal here).

Rwanda’s government is respected for its strong reform track record and is is popular with donors for its relatively transparent and efficient fiscal management. The bulk of its spending, social expenditures, are classic areas for donor support. The country continues to remain structurally dependent on aid, so good relations with donors are important.

The spat with donors comes at a difficult time: the budget deficit for the fiscal year 2012/2013 will amount to RWF137.3bn (USD222m), widening significantly from RWF77.1bn in 2011/2012. The treasury aims to finance this predominantly through net foreign loans of RWF128.5bn and a smaller share of domestic borrowing of RWF8.7bn. While unlikely to lead to a wholesale decline in aid funding, it may make it more difficult financing the jump in the budget deficit, which is a risk factor for budget implementation.

Rwanda’s public finances have been structurally dependent on international financial assistance for years, so it is a little disingenuous for Foreign Minister Louise Mushikiwabo to complain about a ‘child-parent relationship’. While Rwanda has long had legitimate security concerns in Eastern DRC, it also equally pursued economic interests in the neighbouring region where the Kinshasa government exerts limited control:
‘Between their first armed entry into Kivu in 1996, and their formal departure in 2002, after six years of multinational military conflict, the Rwandan army controlled eastern DRC under military occupation.  It is not hard to imagine that during those six years, the Rwandan government developed very strong economic, political and security ties to the two Kivu provinces. Indeed, even after the formal departure of Rwandan forces in 2002, local Congolese militias, and some Congolese army units, remained under Rwandan influence and control.

North and South Kivu are rich in mineral resources, some of which are vital to telecommunications, and are imported in massive quantities by American and European equipment makers. During their military control of the Kivus, the Rwandans established strong commercial links with the mineral producers. These links developed to such an extent that a substantial percentage of Rwanda’s gross domestic product comes from the non-legal mineral trade originating in the eastern Congo.

At present, the government of the Democratic Republic of the Congo, after the completion of its 2011 election, is trying to regain control of its own territory and natural resources. Several units of the Congolese army, stationed in the Kivu provinces, have effectively been under the control and influence of the Rwandan government. These units have been protecting Rwanda’s commercial supply lines that deliver the valuable minerals. The Congolese Government wants to retake control of these units, and either disarm them, or transfer them to other regions of this vast country. The economic stakes are too high for Rwanda, and it is virtually impossible for Rwanda to acquiesce in this attempted reversal of the military balance in the eastern Congo. (African Arguments)
So far, most donors’ reactions are suspensions rather than wholesale cancellations, which leaves scope for a relatively smooth resumption of funding once a solution to the situation in DRC is found. This will also have to take into account the complexities of Eastern DRC and the fact that the DRC government and armed forces have proven ineffective in addressing the mutiny: this power vacuum has long been exploited by different armed groups and even led to clashes between Ugandan and Rwandan military in the past. But this will also force the international community to take another look at Rwanda’s commercial interests in Eastern DRC.

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Comments (1)Add Comment
my point of view
written by murisa jean maurice, August 01, 2012
what this man saying is just what he heard but really Rwanda is not involved in the problem of DRC but UN is very ashamed because nothing has done since arrived in DRC and remember that UN failed to stop genocide in Rwanda so UN is trying to make the world forget all of those .so it's time that Africa be controlled and ruled by Africans.
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