The Independent Uganda: You get the Truth we Pay the Price
Kampala, Uganda | THE INDEPENDENT | The Ministry of Finance, Planning and Economic Development now projects Uganda’s economy to grow at 10.4 percent next financial year.
This is based on the expected commencement of the flow and exportation of crude oil by the country, with State Minister for General Duties Henry Musasizi that 2026/2027 is the country’s opportunity to fast-track “the qualitative leap to upper middle-income status”.
He was briefing the Budget Committee of Parliament on the National Budget Framework Paper for the financial year 2026/2027, Wednesday.
Uganda’s GDP is said to have grown by 6.3 percent in the financial year 2024/2025, while the projected growth rate for this financial year is between 6.5 to 7.0 percent, according to the government figures.
At a growth of 10.4 percent next year, the size of the economy would therefore expand to UGX 290.2 trillion (equivalent to USD76.7 billion), as the country drives to its tenfold growth strategy of USD 500 billion by 2040.
“The budget for next financial year will be guided by the aspiration to expand the size of the economy tenfold before 2040, starting by doubling GDP every five years as programmed under the NDPIV,” said Musasizi, adding that this policy direction would be implemented through sustained investments in the ATMS (Agro-industrialization, Tourism, Mineral development, and Science, Technology and Innovation, including ICT) and enablers,” said the Minister.
However, this growth projection is subject to unforeseeable occurrences like weather, according to the Bank of Uganda Governor, Michael Atingi-Ego.
“Economic growth over the near-medium term could be constrained by adverse weather conditions that could disrupt food crop production, posing risks to agricultural output and rural livelihoods,” he says, but adds that there are also fears of the effects of geopolitical tensions.
Rising geopolitical tensions, particularly among key trading partners, may disrupt trade flows, while related trade tensions could dampen global demand and negatively affect Uganda’s export performance.
Atingi-Ego, however, says the strategies in the tenfold growth strategy will likely balance off the shortcomings, but expects growth to average 8 percent in the medium term (three to ten years).
According to the Ministry, there are some critical outstanding business considerations going into the next financial year, including stamping out budget games that it says breed corruption; closing leakages in routine expenditures such as transfers to schools, health centres and the payroll; Improving liquidity (cash) management and sovereign credit ratings and diversifying sources of development finance including tapping into innovative financing.
The preliminary resource envelope for the year is UGX 69.4 trillion, down from UGX 72.376 trillion in the current financial year.
This is planned to be partly funded by local revenues projected at UGX 40 trillion, up from the current year’s target of UGX 36.73 trillion. Musasizi said the budget allocation to the Finance Ministry next fiscal year 2026/27, is estimated at UGX 2.69 trillion, down from UGX 2.797 trillion.
The reduction is due to the overall reduction in the total resource envelope. He also noted that a resource allocation of UGX 28.264 trillion for vote 130 (Treasury Operations) will go towards ensuring timely processing of debt service payments, redemptions and other statutory obligations.
This is aimed at ensuring reduction in the national debt through debt repayments but also curb the increase in new debt by increased domestic revenues.
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