BANKI NKURU Y’ U RWANDA— NATIONAL BANK OF RWANDA– BANQUE NATIONALE DU RWANDA

June 2008

Table of contents Part I: Economic and financial developments
SUMMARY……………………………………………………………………………………………………………………………..3 Chapter I International economic environment……………………………………………………………17

I.1 Economic situation…………………………………………………17
I.2. World trade…………………………………………………………………………………………………20 I.3. Interest rates and capital markets…………………………………………………………….22 Chapter II National economic development ...…………….………………………………….……………25 II.1 Real sector ……….…………………………………………………………………………………………25 II.1.1 Gross domestic product …….………………………………………………………………..25 II.1.2 Prices. ………….……….…………………………………………………………………………36 II.2 Public finance and domestic public debt ……………………………………………….44 II.2.1 Public finance…………………………..………………….……………………………………47 II.2.2 Domestic public debt………………………….…………..………………………………..47 II.3 Monetary and financial sector II.4 External sector II.4.1 II.4.2 ………………..………………………………………………48 II.3.1 Monetary Development ………………………………………………………………………….48 …………………………………………………………………………………………54 …………..……………………………………………………..54 Balance of payments

External debt …………………………………………………..………………………………..65

Part II Activities of the Bank
Chapter III Activities related to the main missions of the Bank ……………………………….71 III.1 Foreign exchange policy and operations……………………………………………………71 III.1.1 Foreign exchange policy……………………………………………………………………71 III.1.2 NBR foreign exchange operations ….…………………………………………………72 III.2 Implementation of monetary policy……………………………………………………………74 III.2.1 Liquidity Regulation ……………..………………………………………………………………74 III.2.2 Money market operations …………………………….……………………………………….74 III.3 Management of special funds and lines of credit …..…………………………..77 III.3.1 Introduction …………………………………………………………………………………..77 III.3.2 Special funds management ……………………………….……………………………77 III. 4 Foreign reserves management ……………………………………………………………….83 III.4.1. International ……………………………..…………………………………………………83