APPENDIX I. LETTER OF INTENT
April 25, 2010
Mr. Dominique Strauss Kahn
International Monetary Fund
Washington, DC 20431
Dear Mr. Strauss Kahn:
On behalf of the Government of Uganda, I wish to provide you with an update on the progress we have made under our program backed by the IMF’s Policy Support Instrument (PSI). Further, I would like to request continued cooperation through a new three-year PSI.
Performance under the PSI through the 7th review has remained strong and all end-December assessment criteria have been met. Our strong policy framework enabled us to limit the impact of the global financial crisis on our economy. Growth has slowed but remains robust and is set to recover quickly, and inflation has been kept under control. Although there have been some delays in reforms, particularly in public financial management, we have made advances in other areas and we remain committed to strengthening the structural reform agenda.
We recently launched our National Development Plan (NDP) aimed at sustaining long-term economic growth, promoting economic transformation and wealth creation. To better align program targets with our medium-term development plans, the Government of Uganda wishes that the current PSI be canceled immediately upon conclusion of the seventh review, and that a new three-year PSI commence immediately thereafter.
The attached Memorandum of Economic and Financial Policies (MEFP) sets out the Government’s objectives and policies derived from our NDP. Specific emphasis is placed on infrastructure investment to address critical constraints to growth in a coherent and consistent framework. The new PSI also seeks to rejuvenate the structural reform agenda.
The Government of Uganda believes that the policies set forth in the attached MEFP are adequate to achieve the objectives of our PSI-supported program but will take any further measures that may become appropriate for this purpose. We stand ready to work with the Fund and other development partners in the implementation of our program and will consult in advance should revisions be contemplated to the policies contained in the PSI.
The Government of Uganda authorizes publication of this letter, its attachments, and all reports prepared by IMF staff for the 7th review under the PSI and the request for a new PSI.
Ms. Syda Bbumba
Minister, Ministry of Finance, Planning, and Economic Development
cc: The Governor, Bank of Uganda
Attachment 1. Uganda: Memorandum of Economic and Financial Policies
April 25, 2010