Uganda's economy on course for 6.4% growth — finance ministry

The Ugandan economy is "on track" to achieve a projected growth of 6.4 percent this financial year, the finance ministry said on Tuesday (April 8).

A marked growth in GDP in the first (6.7 percent) and second (5.3 percent) quarters of this financial year was reported. This is compared to a growth of 5.6 percent and 5.8 percent respectively over the same period in the previous financial year.

GDP (Gross Domestic Product) means the monetary value of all finished goods and services made within a country during a specific period.

Uganda is banking on increased manufacturing activity (industry) and food production (agriculture) as well as wholesale trade and transport activities (services) to achieve the 6.4 percent projected growth.

This was revealed by finance ministry permanent secretary Ramathan Ggoobi at a press conference on Tuesday announcing the release of funds (sh19.79 trillion) for this fourth quarter (April-June) expenditure.

Key Q4 allocations

Ggoobi said the government’s focus on the drivers of GDP growth is crucial for sustainable economic development and job creation.

Among the key allocations for Q4, sh8.903 trillion is for wage, non-wage recurrent and development projects.

Sh8.126 trillion will cater for debt and treasury operations, 2.677 trillion for external financing and sh83.85 billion local revenue.

The Q4 funds represents 25.64 percent of the revised national budget.

The cumulative release for the 2024/25 financial year amounts to sh76.422 trillion against the revised budget of sh77.196 trillion, which indicates a 99 percent performance, according to the finance ministry.

“Timely payment of wages is essential for maintaining morale and productivity within the public sector," said Ggoobi, who is also the Secretary to the Treasury.

"We understand the importance of our civil servants in delivering services to the public, and we are committed to ensuring they are supported.

“Infrastructure development is a cornerstone of our economic strategy. By investing in roads, schools, and healthcare facilities, we are laying the groundwork for a prosperous future," said the finance ministry PS.

The attention on infrastructure will have been seen as particularly timely because the government says it is working to attract foreign investment as well as boost trade.
Improved infrastructure will facilitate business operations and enhance Uganda's competitiveness in the regional and global markets. 

'Transparency is key'

In his briefing, Ggoobi said eliminating domestic arrears is essential for maintaining trust and efficiency within the public sector.

“We recognize that delays in payments can hinder service delivery and create a ripple effect throughout the economy. Our goal is to ensure that all service providers are paid promptly, allowing them to continue their operations without disruption.”

To further enhance transparency and accountability in financial management, the finance ministry is encouraging the public to access detailed budget information on the ministry's website and the Budget Call Centre.

'Collective effort'

Meanwhile, the government is implementing a Ten-fold Growth Strategy aimed at transforming the economy and improving the living standards of its citizens. 

This strategy focuses on enhancing productivity, fostering innovation, and creating an enabling environment for businesses to thrive. 

“Our vision is to see Uganda become a middle-income country by 2040,” said Ggoobi. “This requires collective effort from all stakeholders, including the private sector, civil society, and the government.”

He also said the government is working to create an environment conducive for entrepreneurship and innovation. 

“By providing access to financing and training, we can unlock the potential of our young people.”

In addition to economic growth, the government is also prioritizing social development.

“Education is the foundation of our future. We must ensure that our children have access to quality education and healthcare services to thrive,” said Ggoobi.

'Resilience'

But in all this, several challenges — including global economic uncertainties and the impact of climate change — lie in wait.

Ggoobi expressed confidence in the government’s ability to navigate them.

“We are aware of the external factors that can affect our economy, but we are committed to implementing policies that will mitigate these risks," he said.

"Our focus on sustainable development will help us build resilience against future shocks."