Govt will weather the economic storm
Global shocks can affect us, but they need not determine our destiny. We must adjust our spending, conserve fuel, strengthen local production and embrace wealth creation, writes Milly Babirye Babalanda
Milly Babirye Babalanda. (File)
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OPINION
By Milly Babirye Babalanda
Uganda, like many countries around the world, is facing a challenging economic moment. Fuel pump prices are now averaging within the sh7,000 range, while the Uganda shilling, which had remained stable for a long time, has weakened to around sh4,000 against the US dollar.
These developments are affecting transport, food prices, production costs and household incomes. I understand the anxiety among Ugandans, but my appeal is that we remain calm, adjust our spending habits and trust the Government’s capacity to steer the country through this temporary economic storm.
As President Yoweri Museveni and defence minister Kiryowa Kiwanuka have explained, much of the current crisis is driven by factors beyond our immediate control. Understanding these challenges will help us respond prudently rather than panic.
Why we shouldn’t panic
Uganda has overcome difficult economic moments before. During the COVID-19 pandemic, lockdowns and restrictions disrupted businesses, trade, tourism and household incomes. Nevertheless, our economy demonstrated resilience, recording encouraging performance compared with many countries. The President’s international recognition for his leadership during the pandemic reflected this experience.
We should draw confidence from that history. It does not mean we should underestimate the current difficulties, but rather recognise that responsible leadership, appropriate interventions and collective effort can help us overcome them. One major factor is the international oil market. Brent Crude prices rose from $71 per barrel on July 1, 2026, to $106.69 by September 15, 2026, representing an increase of roughly 40%.
Disruptions along this route reduce supply and put upward pressure on prices. As a landlocked country, Uganda faces the additional disadvantage of depending on regional transport corridors to receive petroleum supplies. Although we cannot control global oil prices, we can manage consumption, minimise waste and use resources more efficiently.
Tourism, remittances and coffee exports
In his 64th Independence Day address, Museveni also highlighted the effects of the recent Ebola outbreak and travel advisories that discouraged tourists from several Western and Middle Eastern countries from visiting Uganda.
Tourism is among our leading foreign exchange earners, contributing approximately 5.9% to 10% of national exports and GDP. According to the tourism ministry, the sector earns about sh6.1 trillion, equivalent to $1.7b, annually. International arrivals of between 1.64 and 1.65 million visitors make a significant contribution to this revenue. Any disruption to international travel can therefore reduce foreign currency inflows.
Remittances from Ugandans abroad are equally important. Available data indicates that Ugandans living overseas sent home $2.5b last year, approximately sh9.3 trillion. Of this amount, 71.2%, or $1.78b, came from the US, Saudi Arabia, the UK, the United Arab Emirates and Canada.
Disruptions affecting travel and economic activity in these countries can threaten these financial flows. When foreign currency inflows decline while demand for dollars remains high, the shilling comes under pressure. Coffee exports have also been affected. The International Coffee Organisation reported a 14.5% decline in commercial-grade coffee prices, driven by increased global supply from major producers, such as Brazil and Vietnam.
Meanwhile, a dry spell affected coffee-growing areas, including Greater Masaka, Kyotera, Sembabule and Luwero. Uganda consequently registered a 15% reduction in coffee exports in July 2026 compared with July 2025, translating into an 18.6% decline in coffee revenue over the same period. These developments demonstrate how international market fluctuations and domestic production challenges can combine to affect our economy.
What citizens can do
However, recovery requires more than government action; every Ugandan has a responsibility. We must exercise greater prudence in our expenditure, particularly regarding fuel consumption. As Kiryowa observed, Uganda is still receiving fuel; the immediate pressure is largely on prices. We should, therefore, respond with sensible consumption rather than panic.
Those who can work from home should consider doing so where their jobs permit. Businesses and institutions should explore flexible working arrangements that reduce unnecessary journeys. Families with several vehicles can reduce the number they use regularly, while individuals can organise errands and share transport where practical. These measures are not unique to Uganda. According to the World Economic Forum, other import-dependent countries, such as Pakistan, Bangladesh and Sri Lanka, have adopted fuel-rationing strategies.
Value addition critical
We must also address our dependence on exporting raw materials, instead of finished products. Museveni has repeatedly emphasised value addition and the current situation reinforces its importance. The President cited the example of Ugandan coffee selling for just $2 per kilogramme in Germany, while a processed kilogramme of shelf-ready drinking coffee from Germany fetches $40. This illustrates the value we lose when we export raw materials without processing, branding and packaging them locally.
Our coffee remains in demand
The agriculture ministry has warned farmers against harvesting immature coffee beans because doing so compromises quality and reduces earnings. Plans announced by the President to expand irrigation and fertiliser supply should also support climate-smart agriculture. I appeal to leaders at all levels to intensify monitoring of the Parish Development Model (PDM) and the 4-Acre Model.
Let’s weather the storm together
I urge Ugandans to remain calm, follow government guidance and continue working, producing and investing. We must adjust our spending, conserve fuel, strengthen local production and embrace wealth creation. Global shocks can affect us, but they need not determine our destiny.
The author is the Minister for the Presidency and Budhiope West MP