According to the report, Uganda’s economy is expected to grow by 5.5% in the 2022/2023 financial year, up from 4.7% in the previous financial year.
The estimate was revealed in the 20th edition of the World Bank’s Uganda Economic Review, which states that the Ugandan economy has bounced back from the Covid-19 pandemic.
The 20th edition of the Uganda Economic Update was released in Kampala on December 15, 2022.
The report also showed that Uganda’s economy is expected to grow by up to 6% in 2024, showing the strength of the economy during the global recession.
During the pandemic, Uganda’s economy took a major hit as the lockdown laws cut economic growth in half by 2021.
The country’s economic recovery has grown in 2022, due to strong performance in the services and industrial sectors, continued private consumption, and increased private investment.
The bank projects that in the coming years, the East African nation’s economic growth will be accelerated by infrastructure construction and heavy investment in oil production.
The World Bank report reads in part, “Rapid growth could reduce the poverty rate slightly to 41.9 percent by 2024, although this will depend on how conditions change.”
Speaking on the World Bank concept, Ms. Mukami Kariuki, World Bank Country Manager, said “Now, to generate enough jobs for one of the world’s fastest growing populations, to accelerate income growth and lift its people out of poverty, Uganda’s economy will need to grow rapidly, sustainably, and broadly. Strengthening regional trade and international trade is one way to do it.”
However, the World Bank warned against limiting growth. First, the bank warned that if the Ebola outbreak in the country is not contained, it could seriously affect the country’s economy.
The report also warned of a resurgence of the Covid-19 epidemic. Asides health-related issues, there is also the issue of incurring too much foreign debt. This is currently not a problem for the Ugandan government, as it is still able to service its debts, however, now more than ever, Uganda must be careful not to exceed its current capacity.
“Government’s fiscal plan must balance spending to create enough room for priority spending while continuing to shift spending away from infrastructure and investment in the workforce,” the report shows.