Rwanda's economy, which is based on subsistence agriculture, was devastated by the massacres of 1994, the huge refugee populations that resulted, political upheaval and, since then, ongoing fighting in several parts of the country.
Plantains, sweet potatoes, cassava and beans are grown for domestic consumption; tea and coffee are the principal cash crops and there is extensive livestock farming. Some rice and sugar plantations have also been developed.
Rwanda has some mineral deposits - principally tin ores, but also several ores containing rare metals such as tungsten and tantalum, which are in heavy demand in the world market. Extraction of the large natural gas reserves discovered beneath Lake Kivu has begun, although it has been disrupted by local fighting.
The industrial sector produces tobacco, metal goods, chemicals, rubber and plastics. In the service sector, the embryonic tourism industry (geared towards ecotourism) has had to restart from scratch as a result of the 1994 genocide and subsequent events.
Given the political situation, exacerbated by a series of poor harvests during the late 1990s, it is hardly surprising therefore that Rwanda continues to rely heavily on international aid.
A new Structural Adjustment Programme was begun in 1998, followed by an ambitious privatisation programme: both are being conducted under the supervision of the IMF and World Bank. In 2002, telecommunications and government-owned tea plantations were put up for sale. The results so far have been quite good: the economy grew 5.8% in 2005 and inflation was 6.7%. But, like most sub-Saharan African economies, Rwanda is especially vulnerable to commodity price movements; these are presently at a very low level.
Aid donors have also promised further assistance conditional on Rwanda pulling its troops out of the Democratic Republic of Congo. The main regional cooperation mechanism for Rwanda is the Common Market for Eastern and Southern Africa.