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Uganda plans to borrow nearly $2bn to fund 2020/21 budget

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  Uganda said it planned to borrow 1 89 billion dollars 6 9 trillion shillings from external lenders in the 2020 2021 July June fiscal year to partly finance its budget This could come under pressure as veteran leader Yoweri Museveni seeks re election A finance ministry budget paper on Monday showed that the funds would be in the form of concessional and non concessional credit The paper did not indicate how much was borrowed in the previous financial year It also did not indicate from whom the money would be borrowed but in recent years China has become one of Uganda s top external lenders Museveni in power since 1986 is widely expected to seek re election early in 2021 He is expected to face a formidable challenge from pop star turned lawmaker Bobi Wine whose real name is Robert Kyagulanyi Public spending typically surges in election periods in Uganda which has some times triggered pressure on consumer prices and the local currency The paper said economic growth in 2020 2021 would be 6 2 per cent driven by higher productivity in manufacturing and agriculture and public and private sector investment as well as regional and domestic trade Uganda s mounting public debt has been fuelling concern The International Monetary Fund has urged authorities to rein in borrowing Some opposition critics have also accused government of front loading debt before an expected windfall from oil sales Uganda hopes to commence crude oil production in 2022 This month the government said it was planning to borrow 600 million euros 661 million dollars from international banks to plug a hole in its 2019 2020 budget after domestic revenue collections fell short by 9 per cent The shortfall was caused by delays in implementing some planned tax generating measures according to the finance ministry Edited by Fatima Sule Emmanuel Yashim NAN
Uganda plans to borrow nearly bn to fund 2020/21 budget

Uganda said it planned to borrow 1.89 billion dollars (6.9 trillion shillings) from external lenders in the 2020/2021 (July-June) fiscal year to partly finance its budget.

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Yoweri Museveni

This could come under pressure as veteran leader Yoweri Museveni seeks re-election.

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A finance ministry budget paper on Monday showed that the funds would be in the “form of concessional and non-concessional” credit.

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The paper did not indicate how much was borrowed in the previous financial year.


It also did not indicate from whom the money would be borrowed, but in recent years China has become one of Uganda’s top external lenders.


Museveni, in power since 1986, is widely expected to seek re-election early in 2021.

Bobi Wine

He is expected to face a formidable challenge from pop star-turned-lawmaker Bobi Wine, whose real name is Robert Kyagulanyi.


Public spending typically surges in election periods in Uganda, which has some times triggered pressure on consumer prices and the local currency.


The paper said economic growth in 2020/2021 would be 6.2 per cent, driven by higher productivity in manufacturing and agriculture and “public and private sector investment as well as regional and domestic trade.”


Uganda’s mounting public debt has been fuelling concern.

International Monetary Fund

The International Monetary Fund has urged authorities to rein in borrowing.


Some opposition critics have also accused government of front-loading debt before an expected windfall from oil sales.


Uganda hopes to commence crude oil production in 2022.


This month, the government said it was planning to borrow 600 million euros (661 million dollars) from international banks to plug a hole in its 2019/2020 budget after domestic revenue collections fell short by 9 per cent.


The shortfall was caused by delays in implementing some planned tax-generating measures, according to the finance ministry.


(Edited by: Fatima Sule/Emmanuel Yashim)
(NAN)

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Fatima Sule

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