According to government projections, debt will exceed the 50 percent Debt to GDP ratio in the 2021/22 financial year to reach 51.9 percent and then decrease to about 51.2 percent in FY22/23 and further decrease to 49.9 percent in FY 2023/24.
The Ministry of Finance, Planning and Economic Development has
said the new $900 million (about 3.1 trilling Shilling) loan government plans to borrow from the International Monetary
Fund -IMF will not cause a substantial increase of Uganda’s rising public
Responding to questions at Uganda Media Center today, the
Director of Debt at the Ministry of Finance Maris Wanyera said the IMF loan has
already been included in the debt figure that government has shared. And the 3trillion shilling loan will be
disbursed in three financial years starting 2021/22 financial year which will
start on July 1st. It means government will be receiving $300 million from IMF in
each of the next three financial years.
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According to government projections, debt will slightly
eclipse the 50 percent Debt to Growth Domestic Product -GDP ratio in the
2021/22 financial year to around 51.9 percent and then decrease to about 51.2
percent in the 22/23 financial year and further decrease to 49.9 percent in the
2023/24 financial year.
last year borrowed $491.5 million (about 1.7 trillion Shillings) under the Rapid
Credit Facility, a programme that provides access to rapid and concessional
financial assistance to Low-Income Countries facing urgent balance of payments
question of Uganda’s growing public debt gained traction in media in recent
weeks but government maintains that it is still sustainable. Uganda’s total
public debt hit a record 65.82 trillion shilling as of December 2020, up from
49 trillion Shillings in 2019, according to the Auditor General's report.
Now Uganda's Debt Director Maris Wanyera
has dismissed fears that the debt could be unsustainable, arguing that Uganda has not
failed to pay any of its creditors, nor failed to pay on time.
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said government continues to review debt projects that are moving at a slow pace.
“In addition to reviewing projects that are performing slowly, we are
also going to see if we have any project in our portfolio that should be
canceled," Wanyera said. "That also can reduce our debt.”
the same press conference for launching the budget month activities, the
Minister of Finance Matia Kasaija defended increasing taxes such as tax on
fuel. He argued that Uganda’s business community cannot demand services without
paying taxes. He described the extra 100 shilling tax government on each
liter of fuel starting next financial year as negligible.
against taxes, Kasaija argued, present the government with a dilemma of borrowing
more to finance the budget which could lead to mortgaging of the country.