Navigating Uganda's Economic Landscape

Exim Bank Uganda had the privilege of hosting the Treasurers Forum Meeting, where the Acting Head of Treasury, Mr. Julius Ahuriire, shared some valuable insights on key macroeconomic and domestic financial developments.

Economic Growth: 

Mr. Ahuriire mentioned that economic growth in FY2024/25 to be between 6 and 6.5 percent, with a rise above 7 percent in subsequent years. This growth is expected to be driven by increased investment in various sectors such as agro-industry, tourism development, mineral development, and science and innovation. The size of the economy is now estimated at Shs 202 trillion (USD 53.3 billion). 

Private Sector Credit: 

Private sector credit remains subdued due to tight financial conditions. Banks are cutting back on renewing credit lines for borrowers, leading to a decline in gross credit extensions and recoveries. 

Inflation: 

Annual inflation in Uganda increased to 3.9 percent for the 12 months ending June 2024, largely attributed to core inflation and other goods inflation.

Currency: 

The Ugandan shilling has maintained relative stability against the US Dollar, supported by various factors such as CBR increases, export revenues particularly coffee, and capital injections. 

Ugandan Budget: 

The Ugandan national budget for FY2024/25 approved a total expenditure of Shs72.136 trillion, reflecting a significant increase from the initial proposal. The budget prioritizes areas such as peace and security, road maintenance, rail construction, and agriculture.  

Kenya: 

The MPC of Kenya maintained the central bank's base lending rate at 13%, with the annual inflation rate falling to 4.6% in June 2024. 

Though there is sharp decline in business performance, impacting sales, confidence, and job creation due significant headwinds from widespread economic challenges and protests.

Global Economy: 

Global growth is being supported by moderating inflation, accommodative financial conditions, and a pickup in global trade. However, growth rates are forecasted to be lower than prior expansions due to various headwinds including elevated debt burdens, higher interest rates and various geopolitical uncertainties at the regional and national levels.

Overall, the insights shared at the Treasurers Forum Meeting provide a comprehensive view of the current economic landscape in Uganda and beyond. It is crucial for businesses and individuals to stay informed about these developments to make well-informed financial decisions. 

Call to Action:

Trade with Exim Bank Uganda to navigate these economic shifts effectively. Our expertise and personalized solutions empower your financial journey