Challenges and Possibilities: IMF predicts five.five% financial development for Uganda
“Uganda is not spared from this. Yields on government securities peaked at 12-15 % early in 2023 and the Uganda shilling has depreciated. Difficulty in raising concessional financing, coupled with a greater interest burden, indicates that fewer sources are obtainable for discretionary spending, notably on improvement and climate modify adaptation,” Ms. Karpowicz stated.
She insisted that the most effective course of action for the Ugandan government is boosting tax revenues, which are beneath regional competitors. In her assessment, this move is not only required but can also assistance finance improvement investment even though preserving governmental debt sustainability.
Moreover, Dr. Adam Mugume, the Executive Director of Analysis at the Bank of Uganda, identified the challenge Uganda’s reliance on external financing poses, stating that this constitutes a dilemma as it complicates the worldwide economic squeeze.
He stated “However, Uganda really should be in a position to maneuver via offered that most of Uganda’s external debt is from multilateral creditors, primarily Planet Bank, IMF, and African Improvement Bank. Uganda’s exposure to non-concessional loans is to a good extent restricted and as such there is restricted concern on dangers related with rollover of maturing loans from industrial lenders.”