Uganda will increase spending by 10 per cent in the fiscal year starting next month to Ush29 trillion ($8.09 billion) to support flagging economic growth, its finance minister said in a budget speech on Thursday.
The country is estimated to have expanded by 3.9 per cent in the fiscal year to the end of this month, well below an initial forecast of 5.5 per cent, mainly due to a drought and sluggish private sector credit growth.
Matia Kasaija, the finance minister, said reforms in key sectors like farming and financial services would help the economy to attain faster growth.
The country is also investing in the petroleum sector after oil was discovered in 2006.
"As result of these actions, the economy is expected to rebound to annual growth rates of 7 per cent in the medium term, as a minimum," he told lawmakers in Kampala on Thursday.
The government would borrow Ush954 billion from the domestic market, Mr Kasaija said, without saying what the overall fiscal deficit was.
Domestic borrowing in the 2016/17 fiscal year stood at Ush612 billion.
- URA expected to collect Ush15.062 trillion in financial year 2017/18.
- Domestic borrowing Ush954 billion.
- Development expenditure Ush11.349 trillion of which Ush4.273 trillion is government-funded and Ush7.075 trillion from external financing