The State Minister of Finance for Planning David Bahati has said that Uganda’s debt remains sustainable in medium and long term.
Speaking at the budget breakfast conference at Hotel Africana this morning, Bahati said that as of December 2018, Uganda debt was at 41.8% of GDP in nominal terms and 31.7% of GDP in present value terms.
Bahati also said that in the new FY 2019/20, borrowing will be used in infrastructure financing.
“Much of the borrowing next FY 2019/20 will be used to finance our infrastructure needs under roads, energy and petroleum sector development and education and health infrastructure. Timely execution of loan financed projects, contracting loans on concessional terms and diversifying financing options will be prioritized to ensure debt sustainability,” he said
The minister noted further that the country’s economy has recovered and picked momentum growing at over 6% per annum over the last two years.
He added that with the progress in the economic growth, average incomes of Ugandans have increased to $825 per person in FY2018/19 compared to $800 in 2017/18.
However, despite the positive milestones achieved, Bahati admitted that unemployment, widening income inequality between rural and urban areas and malnutrition are still great challenges to the country.
On how government will achieve the FY 2019/20 budget theme, “industrialization for job creation and shared prosperity,” Bahati said development of industrial parks and vocational education will be prioritized.
“In order to speed up industrial growth, the FY 2019/20 budget will prioritize development of industrial parks and export processing zones, reforming technical and vocational education and training, provide support to industrial research and Innovation, establishment of regional science and Innovation hubs and extending investment incentives,” he added
Furthermore, Minister said that the objective of the budget is to continue to commercialize subsistence agriculture, foster and stimulate industrialization and to increase GDP growth and ensure that it is inclusive thereby increasing the incomes of the population.
The event was organized by MoFPED, URA and CSBAG