International Monetary Fund predicts growth for Uganda economy

Bank of Uganda in Kampala Photo:Courtesy

The International Monetary Fund (IMF) expects Uganda’s economy to grow by five per cent this year, up from the four per cent posted last year.

The Brentwood institution said the improved performance would be boosted by, among other things, improved weather conditions after the recent prolonged drought that swept through much of the region and the continent at large.

The projected growth is despite poor credit extension to the private sector in the country. The projection is contained in preliminary findings following a recent visit to the country by IMF staff. 

“Growth is projected to reach five per cent in 2017/18 from four per cent in 2016/17,” said the IMF in its end-of-mission findings. Inflation stood at 4.8 per cent year-on-year in October.

The Bank of Uganda has appropriately continued its easing cycle in October, with core inflation projected to remain in line with the five per cent target.

However, the IMF team said it was concerned with the increase in the poverty headcount ratio to 27 per cent of the population.