IMF tells gov't to invest in areas that will create jobs

By John Odyek

The IMF has urged government to direct public expenditure on areas that support economic growth and job creation in the coming years to tackle the unemployment and poverty problem.

Uganda faces the challenge of increasing unemployment especially among the youth.

Through free Universal Primary and Secondary Education, the Government expects to eradicate abject poverty and backwardness in society.

Similarly, parents hope that with education, their children will get good jobs which will reverse their plight but this is not the case.

The ministry of finance estimates that about 480,000 students leave the education system every year with over 36,000 obtaining university degrees. They estimate that over two million literate youths are jobless and a further over two million are underemployed. Only 20% (80,000) of the school leavers get employed.

“The labour market is characterized by limited job opportunities for graduates. Low productivity and low income earning in sectors such as agriculture make them unattractive to young people. Existence of skill and entrepreneurial gaps in the labour market indicates a mismatch between the training programmes offered by the country’s education system and labour needs of the country,” according to the ministry of finance.

A team from the International Monetary Fund (IMF) visited Kampala during the past two weeks to conduct the second review of Uganda’s economic program supported by the Policy Support Instrument (PSI).

The IMF mission met with senior government officials and members from the civil and private sector.

Ana Lucía Coronel, IMF mission chief and senior resident representative for Uganda said some targets under the PSI were met while others were not. Coronel said government should reduce consumption expenditure but focus on investment in infrastructure and improving productivity in  agriculture where the majority of the population are employed.