London January 20, 2020: The London Stock Exchange today listed the inaugural Bond in Rwandan Franc issued by the World Bank (International Bank for Reconstruction and Development (IBRD), rated Aaa/AAA. The launch of the Rwandan Franc bond for the first time by the WB/IBRD highlighted Rwanda at the UK-Africa Invest Summit in London on January 20, 2020. This transaction is a demonstration of confidence of the World Bank Treasury and other investors in Rwanda’s currency and economic development.  
The WB will raise Frw 37 billion (US$ 40 million) that will be invested in a matching Frw government bond issuance planned on January 22, 2020 to finance investments in the FY 2019-20 Budget. The World Bank Treasury and the Ministry of Finance and Economic Planning have been working on specific solutions the World Bank could offer to support Rwanda’s debt management and financial risk management and the issuance of an offshore local-currency (Frw) denominated bond was one of the solutions identified. With this transaction, the World Bank is contributing to the development of the country’s local capital market and providing an opportunity for international investors to purchase a World Bank bond while gaining exposure to the growing Rwandan economy through the currency.  

Benefits for Rwanda: The issuance in Frw reduces Rwanda’s currency risk arising from the mismatch between foreign currency denominated debt service and Frw denominated revenue (in this case, international investors bear the exchange rate risk). Issuing a Frw denominated bond with foreign investors also helps build demand for Rwanda’s debt beyond local investors, diversifying funding sources to include additional investors. Currently only 4.8 percent of domestically issued bonds are held by non-residents, and by tapping international investors the World Bank will be adding value in bringing fresh capital for projects in Rwanda from a wider investor base outside of Rwanda. This transaction will demonstrate the feasibility of issuing Frw denominated bond at a favorable cost.