Uganda: 2024 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Uganda
IMF Staff Country Reports, September 11, 2024
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- Uganda: 2024 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Uganda
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Bibliographic details
- Published: September 11, 2024
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400288821.002
Key findings and economic outlook
- Uganda has navigated the post pandemic recovery well due to sound macroeconomic policies.
- The economic recovery is strengthening with low inflation, favorable agricultural production, and strong industrial and services activity.
- While public debt is sustainable, low tax revenues constrain Uganda’s fiscal policy space.
- The Bank of Uganda’s tight monetary policy stance has helped anchor inflation expectations and counter external sector pressures.
Fiscal assessment and public debt
- Public debt: described as sustainable.
- Fiscal constraint: low tax revenues limit fiscal policy space.
- Priority reforms: strengthening domestic revenue mobilization and budgetary and cash management practices are key to securing a durable fiscal space.
- Suggested use of future oil revenue: to address growth impediments and improve social development while advancing governance reform and financial inclusion.
Monetary policy, exchange rate, and external sector
- Monetary stance: Bank of Uganda’s tight monetary policy has anchored inflation expectations and countered external pressures.
- Future stance recommendation: monetary policy should remain data driven to ensure price stability and further financial deepening.
- Exchange rate policy: continued flexibility of the exchange rate is important to build up adequate foreign exchange reserves.
Structural and governance priorities
- Addressing governance deficiencies and regulatory burdens is critical to unlocking Uganda’s growth potential.
- Enhancing regional trade integration is also highlighted as critical for growth.
- Financial inclusion and governance reform are linked to effective use of future oil revenues and longer-term development goals.
Policy recommendations (summarized)
- Strengthen domestic revenue mobilization.
- Improve budgetary and cash management practices to secure durable fiscal space.
- Maintain data-driven monetary policy to preserve price stability and promote financial deepening.
- Preserve exchange rate flexibility to rebuild foreign exchange reserves.
- Use future oil revenue strategically to remove growth impediments and improve social development.
- Advance governance reform, reduce regulatory burdens, and enhance regional trade integration.
- Promote financial inclusion alongside governance improvements.
Content in this bundle
- 1ugaea2024002-print-pdf