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Financing Uganda'S Poverty Reduction Strategy: Is Aid Causing More Pain Than Gain?
Author:
Ms. Mwanza Nkusu
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Series:
IMF Working Papers
Volume/Issue:
Volume 2004: Issue 170
Language:
English
Publication Date:
01 Sep 2004
DOI:
https://doi.org/10.5089/9781451858457.001
ISBN:
9781451858457
ISSN:
1018-5941
Pages:
30
Keywords:
WP; right; Uganda; ODA; terms of trade; REER; Foreign aid; exchange rates; economic growth; and poverty; ODA flow; terms of trade shock; Uganda shilling; savings-investment balance; ODA inflow; Real effective exchange rates; Exports; Dutch disease; Real exchange rates; Poverty reduction strategy
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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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.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund