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International Monetary Fund. African Dept.
This paper presents Uganda’s Fifth Review under the Extended Credit Facility Arrangement and Request for Modification of Performance Criteria. Economic recovery continues to gain strength following a rapid decline in inflation, favorable agriculture and robust industrial and services activity. Fiscal financing and foreign portfolio flows are facing headwinds amid tight global financial conditions and the passage of the Anti-Homosexuality Act in May 2023. The authorities are implementing fiscal consolidation to contain vulnerabilities, maintaining a moderately tight monetary stance in the face of upside risks to inflation and undertaking reforms to improve governance and reduce corruption. All September 2023 quantitative performance criteria were met, as well as most June 2023 indicative targets (ITs). Preliminary data suggest that the December 2023 IT for net credit to government and inflation were met but the IT for net international reserves was missed. Four out of seven structural benchmarks for the current review were met on or before test dates, and one was completed with a delay.
International Monetary Fund. African Dept.
This paper discusses Uganda’s Second and Third Reviews under the Extended Credit Facility (ECF) Arrangement, Requests for a Waiver of Nonobservance of Performance Criterion, and Rephasing of Access. The Ugandan authorities are persevering in their reforms despite facing multiple shocks from an unfavorable external environment and new public health challenges. The authorities remain committed to implementing reforms supported by the ECF. Maintaining macroeconomic stability, improving budget composition, and reducing government financing needs will help boost private sector growth and improve people’s livelihoods. Continued resolute and timely implementation of structural reforms, including anticorruption and governance measures, remains key for the success of the program. The Ebola outbreak, rising security challenges, and further spillovers from the war in Ukraine represent the main risks. Uganda’s moderate level of public debt and continued access to concessional financing would provide space to achieve program objectives. A structural benchmark on the asset declaration regime was converted into a prior action for the review and has been met.
International Monetary Fund. African Dept.
This paper analyzes Uganda’s Request for Disbursement Under the Rapid Credit Facility. The Ugandan economy is severely affected by the coronavirus disease 2019 (COVID-19) pandemic. In order to contain the impact of the pandemic, the authorities have increased health spending, strengthened social protection to the most vulnerable, and enhanced their support to the private sector. The Bank of Uganda has appropriately reduced interest rates and provided liquidity to safeguard financial stability, while maintaining exchange rate flexibility. The weakening economic conditions emanating from the Covid-19 pandemic have put significant pressures on revenue collection, expenditure, reserves and the exchange rate, creating urgent large external and fiscal financing needs. The IMF continues to monitor Uganda’s situation closely and stands ready to provide policy advice and further support as needed. The authorities have also committed to put in place targeted transparency and accountability measures to ensure the appropriate use of emergency financing. The IMF’s emergency financial support under the RCF, along with the additional donor financing it is expected to help catalyze, will help address Uganda’s urgent balance of payments and budget support needs.
Mr. Emre Alper
,
Ms. Wenjie Chen
,
Mr. Jemma Dridi
,
Mr. Herve Joly
, and
Mr. Fan Yang
This paper assesses the extent of economic and financial integration among the East African Community (EAC) along a number of dimensions and, where possible, whether integration has increased in the wake of the major regional integration policy milestones.
Ms. Olessia Korbut
,
Mr. Gonzalo Salinas
, and
Cheikh A. Gueye
Economic stagnation in Sub-Saharan Africa (SSA) has led several economists to question the region’s ability to attain sustained economic growth, some of them arguing for the need to shift away from natural resource - based exports. Yet, we find that low growth has not been common to all SSA countries and that those that achieved political stability and significantly liberalized their economies experienced high growth in income per capita, as high as ASEAN-5 countries. This group of SSA countries attained high growth while maintaining their specialization in natural resource exports. Our analysis also rejects the hypothesis of reverse causality: that good growth performance allowed countries to attain political stability or liberalize their economies.
International Monetary Fund

Abstract

The year 2005 marks an important juncture for development as the international community takes stock of implementation of the Millennium Declaration—signed by 189 countries in 2000—and discusses how progress toward the Millennium Development Goals (MDGs) can be accelerated. The MDGs set clear targets for reducing poverty and other human deprivations and for promoting sustainable development. What progress has been made toward these goals, and what should be done to accelerate it? What are the responsibilities of developing countries, developed countries, and international financial institutions? Global Monitoring Report 2005 addresses these questions. This report, the second in an annual series assessing progress on the MDGs and related development outcomes, has a special focus on Sub-Saharan Africa—the region that is farthest from the development goals and faces the toughest challenges in accelerating progress. The report finds that without rapid action to accelerate progress, the MDGs will be seriously jeopardized—especially in Sub-Saharan Africa, which is falling short on all the goals. It calls on the international community to seize the opportunities presented by the increased global attention to development to build momentum for the MDGs. The report presents in-depth analysis of the agenda and priorities for action. It discusses improvements in policies and governance that developing countries need to make to achieve stronger economic growth and scale up human development and relevant key services. It examines actions that developed countries need to take to provide more and better development aid and to reform their trade policies to improve market access for developing country exports. And it evaluates how international financial institutions can strengthen and sharpen their support for this agenda. Global Monitoring Report 2005 is essential reading for development practitioners and those interested in international affairs.

Ms. Mwanza Nkusu
Uganda's market-friendly development strategy and poverty reduction agenda have attracted large financial inflows, including aid. During 2000-02, concerns about a possible aid-induced Dutch disease were heightened by widening macroeconomic imbalances and an upward trend in the real effective exchange rate (REER). This paper shows that the REER remained broadly stable during a 10-year period and nontraditional exports increased remarkably, contrary to the predictions of the Dutch disease model. Also, economic growth was strong. This good performance is attributed to sound macroeconomic policies and important structural reforms, which have allowed an increased use of available production factors.
International Monetary Fund
This 2002 Article IV Consultation highlights that since the conclusion of the last Article IV consultation in March 2001, Uganda has continued to implement disciplined financial policies and sound structural reforms that have helped to sustain robust economic growth despite an adverse external environment. In 2001/02 (July–June), real GDP growth increased to 6.6 percent, boosted by highly favorable weather conditions for agriculture and a surge in construction activity from a pickup in investment. A sharp drop in food crop prices resulted in negative headline inflation of -2.5 percent during the year.
International Monetary Fund
This paper assesses Uganda’s Request for a Three-Year Arrangement Under the Poverty Reduction and Growth Facility (PRGF). The program for 2002/03–2004/05, which could be supported by a new PRGF arrangement, aims to increase real GDP growth to about 6½ percent a year on average, while holding annual inflation at about 3½ percent. Monetary and exchange rate policies will focus on maintaining stability in light of sizable sterilization operations. The authorities will rely on market-based monetary instruments and will adhere to a flexible exchange rate policy.