In a recent announcement, expressed optimism about Uganda’s economic performance, projecting a growth rate of 5.5 percent for the current year, compared to 4.6 percent in the previous year. Kasaija emphasized that Uganda’s economy has displayed resilience and is steadily recovering.

Highlighting the country’s favorable position, Kasaija noted that Uganda’s projected growth rate outperforms the average growth rate for Sub-Saharan Africa, estimated at 3.6 percent for the calendar year 2023. The size of the Ugandan economy is estimated to have reached Shs184.3 trillion, equivalent to approximately US$49.4 billion, compared to Shs. 162.9 trillion (US$45.6 billion) in the previous year.

Kasaija attributed the expansion of the economy to the robust performance of the services sector, which grew by 6.2 percent, surpassing the previous year’s growth rate of 4.1 percent. Additionally, the agriculture sector exhibited strength, growing by 5.0 percent, despite facing challenges from a dry spell in the first quarter of the financial year. Notably, food crops, livestock, and fishing sectors performed well. The industry sector witnessed a growth rate of 3.9 percent, driven primarily by manufacturing and construction activities, particularly within the oil and gas industry.

The Finance Minister also highlighted positive developments in inflation rates, emphasizing the impact of well-coordinated fiscal and monetary policies. He mentioned that since October 2022, when inflation peaked at 10.7 percent, there has been a significant decrease in the inflation rate. In the most recent month, the pace of price increases slowed to 6.2 percent. Consequently, key items such as soap, sugar, and fuel have experienced substantial price reductions, benefiting consumers.

Regarding the cost of borrowing, Kasaija acknowledged a slight increase in commercial bank lending interest rates. In April 2023, the rates rose to 19.3 percent, compared to 18.8 percent in April 2022. He attributed this increase to the decision to raise the Central Bank Rate to 10 percent since October 2022 as part of the efforts to combat inflation.

The Finance Minister’s positive assessment of Uganda’s economic performance and the projected growth rate reflects the government’s commitment to implementing effective policies and strategies to stimulate economic recovery. The resilience shown by the Ugandan economy, coupled with favorable developments in key sectors, bodes well for the country’s overall economic trajectory in the coming years.

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