Kampala, Uganda | THE INDEPENDENT | Uganda could emerge from the COVID-19 crisis as the most resilient compared to the other countries in the region, the International Monetary Fund (IMF) has said.
In the latest report of the global outlook for 2020, the IMF says Uganda’s growth will be 3.5% this year down from 5% in 2019. This is far better than Kenya’s that will drop from 5.6% in 2019 to 1% this year.
Tanzania will only grow at 2% this year after dropping from 6.3% last year.
Uganda will grow at the same level as Rwanda although the latter will have seen the biggest slump if compared to the level of their growth (10%) last year.
In the April 2020 report, the IMF described the current situation as a “crisis is like no other.” It said that globally, growth will slump by negative 3%, dwarfing the losses that triggered the global financial crisis in 2008.
The IMF said in the report that “like in a war or a political crisis, there is continued severe uncertainty about the duration and intensity of the shock.”
It added that “It is very likely that this year the global economy will experience its worst recession since the Great depression surpassing that seen during the global financial crisis a decade ago.”
The IMF’s projection for Uganda is in line with the Bank of Uganda’s forecast of 3-4%.
But this does not mean the country will be better. The country is currently closed for business – literally – with millions of Ugandans expected to be unemployed and fall back into poverty. Tourism and the hospitality industry have collapsed while tax revenues will have the biggest deficit ever.
According to IMF, oil production will be hit too as the prices for it is expected to remain low through to 2023. This means Uganda’s target to start production at that point is unachievable as oil companies hold on investment.
Also, countries including Uganda will lose between 5 and 8% of the working days this year.
On Tuesday, President Museveni extended the lockdown by more 21 days with Ugandans expected to stay home.