1. Our Ugandan authorities appreciate the constructive engagement with staff and share the thrust of staff's assessment of economic developments and key policy priorities.
This paper discusses key findings of the Seventh Review Under the Policy Support Instrument (PSI) for Uganda. The medium-term outlook for Uganda remains favorable but risks are on the rise. Growth is expected to rebound to its potential in the coming two years on the heels of a supportive fiscal stance and higher global and regional growth. It remains vulnerable to exogenous shocks as well as to election-related uncertainties. IMF staff supports the authorities’ request for a new three-year PSI to anchor their near- and medium-term policies.
This paper discusses key findings of the Third Review Under the Policy Support Instrument for Uganda. All end-December 2007 assessment criteria were met. Macroeconomic performance remains strong and the growth outlook remains positive. IMF staff supports the authorities’ request for waivers of nonobservance of four structural assessment criteria for end-May and end-June 2008. Nonobservance of these assessment criteria was largely owed to changes in program design in light of new information and reassessment of costs and priorities that do not compromise the integrity of the program.
Uganda’s medium-term expenditure framework (MTEF) aims at higher public savings based on spending restraint and rising domestic revenue. The Bank of Uganda (BOU) has successfully contained the one-time shocks to prices of increases in electricity tariffs and temporary sugar and diesel fuel shortages. In an environment of strong inflows, price stability remains the primary objective of monetary policy. A shallow financial sector limits Uganda’s ability to absorb foreign exchange inflows and is in itself a formidable obstacle to faster economic growth.
This paper discusses Uganda’s Sixth Review Under the Three-Year Arrangement Under the Poverty Reduction and Growth Facility (PRGF), Request for Waiver of Performance Criteria, and Request for a Policy Support Instrument (PSI). Performance relative to the sixth and final PRGF review was satisfactory. The authorities request waivers for two performance criteria that were not observed by small margins. Corrective measures will be undertaken during 2006. The authorities have also requested a PSI to begin immediately after the current PRGF arrangement expires.
The IMF Research Bulletin, a quarterly publication, selectively summarizes research and analytical work done by various departments at the IMF, and also provides a listing of research documents and other research-related activities, including conferences and seminars. The Bulletin is intended to serve as a summary guide to research done at the IMF on various topics, and to provide a better perspective on the analytical underpinnings of the IMF’s operational work.
Bolivia, Mauritania, and Uganda have become the first three countries to receive debt-service relief under the enhanced Heavily Indebted Poor Countries’ (HIPC) Initiative, the IMF and the International Development Association (IDA) have announced. Relief for Bolivia and Uganda will amount to $1.3 billion each and for Mauritania, to $1.1 billion. The enhanced assistance will be provided after the three countries, in concert with civil society, adopt strategies to reduce poverty and will help finance social expenditures.
Against a backdrop of a healthy and expanding global economy, with the lowest inflation in more than thirty years and cautious optimism blanketing global equity markets, finance ministers and central bank governors of advanced and developing countries met in Washington on April 28. The Interim Committee (of the Board of Governors of the IMF), under the chairmanship of Belgium’s Philippe Maystadt, welcomed the prospects for further expansion of world output and trade, the result of sound macroeconomic policies and vigorous structural reforms in many countries. In his opening press conference on April 25, IMF Managing Director Michel Camdessus remarked that global economic prospects warranted “rational exuberance.”