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Minister of State for General Duties has said despite several challenges, the economy continues to grow strong.

Musasizi was today appearing before the Parliamentary Committee on National Economy to discuss the performance of Uganda's economy and the state of indebtedness.

The Committee is assessing the state of national economy and indebtedness with a view of improving the economy.

Musasizi said the economy continued to strengthen in the first six months of Financial Year 2023/24, fueled by Government’s ongoing efforts to support growth and the significant boost in business activities.

He said the Parish Development Model and Emyooga, alongside accessible funding from Uganda Development Bank have played a pivotal role in this upward trend.

"GDP is projected to grow by 6% in Financial Year 2023/24, higher than the growth of 5.2% registered the previous fiscal year," he said.

The Minister said total public debt stock as at end of June 2023 was shs.86.78 trillion and out of this, government securities accounted for shs.34.57 trillion and external debt was shs.52.21 trillion.

He also said the drivers of public debt include rising expenditure requirements and higher interest rates on borrowing.

To maintain debt sustainability over the medium term, Musasizi said the government of Uganda will increase domestic revenue collections, increase efficiency and effectiveness of expenditure and support private sector growth.

In his report to Parliament dated December 2023, the Auditor General John Muwanga said the total public debt as at June 30,2023 stood at sh96.168 trillion, comprising of Domestic Debt Stock of sh43.6trilliion and the External Debt Stock of sh52.4trillion, representing an increase of sh9.3trillion.

“From the above, it was noted that there has been a consistent increase in the total debt as evidenced by an increase of 107% in the five years from 2018/19 of sh46 trillion, to sh96.1 trillion as at June 30 2023. Relatedly, the Gross Domestic Product grew from sh132trillion 2018/2019 to sh184.8trillion in 2022/23 in the same period representing an increased growth of sh52.805Tn. This implies that the public debt is growing at a higher rate than GDP,” Muwanga said.

He attributed the increase in the debt to increased Government expenditure compared to the domestic revenue to fiancé the fiscal deficit.

“The increasing trend in the government debt position compromises the Government’s position to repay the debt and deliver services to the citizens. The government is advised to review its debt strategy with a view to containing the upward growth of debt,” Muwanga said.