Kampala, Uganda | THE INDEPENDENT | The International Monetary Fund has hailed Uganda for achieving the Millennium Development Goal on halving poverty ahead of schedule but warned that the country must create over 600,000 jobs per year to keep up with its growing population.
In its latest report after recent consultations with Uganda’s finance managers, the IMF said “Uganda has made impressive development gains and achieved the Millennium Development Goal on halving poverty ahead of schedule. Going forward, Uganda must create over 600,000 jobs per year to keep up with its growing population, while making further progress on poverty reduction and the Sustainable Development Goals.”
The IMF report stated that Uganda is able to achieve 6 to 7% growth over the next five years if investments, especially in the oil sector go as planned.
“The authorities’ development strategy centers on infrastructure and a nascent oil sector. If investments proceed as planned, growth could range between 6 and 7 percent over the next five years (3 to 4 percent in per-capita terms),” the report states.
Risks include next elections
The IMF however warns that the investments Uganda is making would contribute to rising public debt and a widening current account deficit until oil production starts. They also warn of the security situation in the run up to the next elections.
“Risks to the outlook are tilted to the downside, including from weather-related shocks, the regional security situation, shocks from the global economic environment, and the political and security situation in the run-up to the 2021 general elections,” the report, of the first stand-alone Article IV consultation after an extended period of program engagements with Ugandan officials.
Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country’s economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board.
#Uganda must create over 600,000 jobs every year to keep up with its growing population. In the IMF’s latest report on 🇺🇬Uganda, we have looked at the policies needed for this high sustained inclusive growth. https://t.co/qM4TlRf9My #IMFAfrica pic.twitter.com/dQ21ABWVv2
— IMF (@IMFNews) May 9, 2019