On 25th September 2009, Rwanda’s Minister of Finance and Economic Planning Hon. James Musoni representing the Government of Rwanda and the COMESA Secretary General Mr. Sindiso Ngwenya signed a memorandum of understanding leading to the disbursement of €10.3 Million (equivalent to about 8.8 billion Rwanda Francs) Under the COMESA Regional Integration Support Mechanism (RISM).

At the ceremony, a cheque of the above said amount of money was also presented by Mr Ngwenya to Rwanda. Rwanda becomes the second COMESA/EAC country to benefit from the COMESA Adjustment facility. This comes exactly two weeks after disbursement of Euro 4.4 million (7.7 billion Burundi Francs equivalent) to Burundi under the COMESA adjustment Facility.

This represents 65% of revenue losses from customs duties and related taxes which Rwanda has estimated, on the basis of the method of calculation of the Operational Rules and Guidelines of the Facility, as a consequence of aligning its customs tariff to the East African Community (EAC) Common External Tariff (CET) for the June 2009 -July 2010 fiscal year.

The ceremony is highly significant taking into account the COMESA Adjustment facility is rewarding Rwanda for aligning its tariffs to EAC/CET. This shows how far Regional Economic Groupings are determined to work together to integrate the East and Southern Africa region.

Also present was the EAC Deputy Secretary General Jean Claude Nsengiyumwa on behalf of EAC. The European Commission to Rwanda was represented by Ambassador David Macrae.

The disbursement is estimated at 65% as indicated above. The Republic of Rwanda shall at the end June 2009 -July 2010 fiscal year compute the actual revenue loss it will have incurred in comparison with 2008/2009 revenue and submit a report through the COMESA Secretariat to the regional Integration Support Mechanism (RISM) Advisory Committee which on that basis will approve the actual amount of support that will be granted to the Member State on the account of the alignment of its customs duty to the EAC CET.

It is envisaged that should Rwanda’s estimate be perfect, The RISM Advisory Committee shall advise COMESA to disburse the remaining 35%, equivalent to € 3,502,000. The additional amount could therefore be more or less depending on what the actual revenue losses turns up to be.

Speaking at the ceremony, Minister Musoni, pointed out that the signing of the MoU demonstrated the commitment that the Government of Rwanda has made to deepen Regional Economic integration. The Minister noted that Rwanda joined the COMESA Free Trade Area in 2004 and became full member of the EAC with effect from 1st July 2007. He further stated that Rwanda expects to derive economic benefits from COMESA and other regional memberships, as a result of broader market access and increased investment in its economy.

The Minister appreciated the timely support provided under the COMESA Adjustment Facility and stressed that it will help Rwanda to lessen the negative impact of Regional Economic Integration reforms and allow the Government to achieve its commitments as reflected under the Regional Integration Implementation Programme. He finally thanked the COMESA for this support and reiterated the commitment of the Government to implement the reform actions included in the Regional Integration Implementation Programme.

In his presentation speech, COMESA Secretary General Sindiso Ngwenya gave a background to the fund noting that the process to operationalise the COMESA Adjustment Facility involved building the credibility of the facility in a manner that allowed the European Commission to channel its support through regional (COMESA) mechanism instead of the usual project approach.