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IMF Country Report No. 24/291
UGANDA
SELECTED ISSUES
September 2024
This Selected Issues paper on the Uganda was prepared by a staff team of the International Monetary Fund as background documentation for the periodic consultation with the member country. It is based on the information available at the time it was completed on August 16, 2024.
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© 2024 International Monetary Fund
Title Page
UGANDA
SELECTED ISSUES
August 16, 2024
Approved By
African Department
Prepared By Hany Abdel-Latif, Jean Christine Armas, Geoffrey Bannister, Izabela Karpowicz, Khushboo Khandelwal and Franklin Sozi
Contents
MACRO-FINANCIAL LINKAGES IN UGANDA THROUGH THE LENS OF BALANCE SHEET ANALYSIS
A. Introduction
B. Network Map Analysis
C. Financial Input-Output Analysis
D. Key Messages
FIGURES
1. Banking Sector Developments
2. Network of Net Financial Exposures of Economic Sectors
3. Liabilities of the NFC Sector Held by Economic Sectors
4. GG Sector Charts
5. Gross Exposures of ODC Sector – Claims on Economic Sectors
6. Regional Comparison
7. Deposit Liabilities of ODC Held by Economic Sectors
8. Bank Deposits-to-GDP (%) in EAC Region
9. Scenario 1 – Impact of 25% Exchange Rate Depreciation
10. Scenario 2 – Impact of 20% Increase in Government Interest Payments
ANNEX
I. Financial Input Output Methodology
References
UGANDA’S MONETARY POLICY TRANSMISSION
A. Introduction
B. Monetary Policy Framework in Uganda
C. Previous Research Findings
D. Empirical Results
E. Conclusion and Policy Implications
FIGURES
1. Headline Inflation: Uganda versus Sub-Saharan Africa
2. Policy Rate in Uganda, 2011–2024
3. Neutral Rate and Real Interest Rate, 2013Q1–2024Q1
4. Real Policy Rates by EAC Countries, 2018Q1–2024Q1
5. Uganda’s Bank Lending Rate versus Policy Rate, 2015 Q1–2024Q1
6. Policy Rate Response to Exchange Rate Shock
7. Exchange Rate Response to Policy Rate Shock
TABLE
1. Effects of 100 Basis Points Increase in the Policy Rate
ANNEXES
I. The Dataset
II. Empirical Methodology
References
SOCIAL AND ECONOMIC PROGRAMS AND GENDER INCLUSION
A. Introduction
B. Social and Economic Programs: Overview
C. Programs Effectiveness and Gender Outcomes: a Review of Literature
D. Regression Results
E. Conclusions and Policy Recommendations
FIGURES
1. Social and Economic Programs: Annual Budget Disbursements
2. The Senior Citizen Grant
3. Distribution of UWEP Beneficiaries
4. Distribution of YLP Beneficiaries
5. Poverty Incidence of Programs
TABLE
1. Regression Results
BOXES
1. The Design of Social and Economic Programs Included in the 2019/20 UNHS
2. The Parish Development Mode
3. The Households Survey Stylized Facts
ANNEXES
I. Gender Gaps
II. The Institutional Framework for Social Protection and Gender
References
REDUCING INFORMALITY TO RAISE PRODUCTIVITY AND PROMOTE INCLUSION IN UGANDA
A. Introduction
B. Uganda’s Labor Market Trends
C. Youth Employment Trends in Uganda
D. Transition from School to Work: Evidence from Youth in Uganda
E. Conclusion and Policy Implications
FIGURES
1. Informal and Formal Employment, 2020
2. Share of Youth Population (15–29) by Status and Stages, 2021
3. East African Community: Informality Estimates, 1991–2019
4. Labor Market Outcomes by Education Level, 2015
5. Employment Statistics Among Youth, By Gender, 2015
TABLES
1. Key Labor Market Indicators
2. Transitioning to Informal vs. Formal Jobs
References