The country’s economy is projected to surge to 10.8% growth in the 2025/2026 fiscal year, up from an earlier estimate of 6.2%.
The IMF report, released Wednesday, states that the beginning of oil production will significantly improve Uganda’s fiscal and current account balances, leading to stronger overall economic growth.
After almost two decades of postponement, Uganda is set to begin crude oil production and exports next year from its western fields.
Commercial oil reserves were found in 2006, but factors such as disagreements with oil companies over development plans and insufficient infrastructure delayed the start of production.
Uganda is expected to reach a peak output of 240,000 barrels per day from its estimated 6.5 billion barrel reserves.
The IMF reported that Uganda’s foreign exchange reserves have continued to decrease and recommended central bank action, including cutting government imports, increasing foreign exchange purchases, and adopting more exchange rate flexibility.
Uganda’s FX reserves dropped to $3.2 billion in June from $3.7 billion in December 2023 due to high debt servicing costs, limited access to affordable credit, and reduced hard currency acquisitions, the IMF noted.
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