Burundi: an economy on the brink

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In Burundi, the poverty rate has exploded. (illustration image) AFP

By: Olivier Rogez Follow

Burundi, in political crisis since the third mandate of outgoing President Pierre Nkurunziza in 2015, saw its economy collapse and the poverty rate exploded.

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Pierre Nkurunziza's third term and the political crisis that accompanied him will have plunged the Burundian economy. All indicators are red and the poverty rate has jumped 10% in five years. Today, three quarters of Burundians live below the poverty line.

For economist and independent expert Faustin Ndikumana, malnutrition has become endemic. “  In Burundi we are at 1,600 calories per day per person, while the normal average must be 2,100 calories per day. There is a calorific deficit, there is a problem of undernourishment. About 60% of Burundians are permanently food insecure  , "he says.

Isolation and drying up

With the political crisis of 2015, the country partially broke away from the traditional IMF and World Bank donors who had supported Burundi during the previous decade. This isolation resulted in a drying up of the budget.

Gabriel Rufyiri heads Olucome, a Burundian organization fighting corruption. For him, “  In 2014, half of the budget was funded by partners in Burundi. With the 2015 crisis, they cut their funding in half. Today, in the general state budget, there are less than 400 billion Burundian francs financed by the country's partners. Almost all of them froze direct budget support .

Financial pressure maintained on rural areas and traders

To make matters worse, strained relations between Burundi and its neighbors have hampered cross-border trade. “  There are fruits grown in Burundi such as mangoes, which were to be marketed in the region, in Rwanda and in Uganda. But Burundi has forbidden these products to be marketed in these countries, so the traders had a lot of problems,  "explains Gabriel Rufyiri.

While the inflow of foreign currency is shrinking and the Burundian franc continues to depreciate, state agents maintain significant pressure on the rural world and traders. “  All the agents of the administration assume the power to collect contributions or to demand from traders contributions, gifts for the administrative agents. All of this is a cost. And it is the traders and the end consumer who bear these transaction costs linked to corruption,  ”deplores Faustin Ndikumana.

Economists agree that the priority of the next president will be to reconnect with the international financial institutions, to break the isolation in an attempt to eradicate poverty.

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  • Burundi
  • Economic crisis

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