Uganda’s economy is projected to get back to a steady-state growth potential of between 6.4 percent and 7.0 percent in the next financial year before hitting the double digit mark over the next five years, the country’s Finance minister has said.
“I am pleased to report that Uganda’s economy has fully recovered from various internal and external shocks that impacted performance in the past four years. GDP is projected to grow by six percent this Financial Year (FY) 2023/2024 compared to 5.3 percent in FY2022/2023,” Minister Kasaija said while unveiling the 2024/2025 budget on Thursday.
He said: “This year’s growth of six percent is even more impressive when compared to sub-Saharan Africa’s average of 3.8 percent, and the global average of 2.9 percent projected for the year 2024.”
Minister Kasaija projects the country’s GDP to expand to Shs225.5 trillion ($60 billion) during the FY2024/2025 that starts next month.
“These numbers exclude the anticipated oil and gas revenues, as well as the planned interventions to grow the economy tenfold. We shall update the projections in the medium term,” he disclosed, adding: “This growth will be driven by: increased oil and gas activities, as we move towards first oil production in FY2025/2026; growth in exports, supported by the increase in regional trade in the EAC and Comesa, intra-Africa trade, and harnessing existing and new trading partners in the Middle East and Asia; increase in tourism activities supported by investment in tourism infrastructure, branding and marketing, and effective implementation of the Meetings, Incentives, Conferences and Events (MICE) Programme.”
The Finance minister also highlighted agro-industrialisation and light manufacturing supported by access to affordable credit through Uganda Development Bank (UDB) as vital cogs in the engine room. Ditto investments supported through Uganda Development Corporation (UDC); the Parish Development Model, Small Business Recovery Fund, Emyooga, the Presidential Industrial Hubs for Youth Entrepreneurs, and programmes to support exporters, as well as growth and productivity of women enterprises.
“Our growth prospects face some risks that will need to be mitigated. These include climate change affecting agricultural production and infrastructure, regional and global geopolitical tensions, (high interest rates which constrain access to affordable debt, and fluctuations in global commodity prices,” he said.
Mr Kasaija said to minimise the effects of these risks, the government is implementing climate change adaptation measures, exploring cheaper sources of financing, including climate finance, and ensuring frugality in government expenditure
