A government decision to mobilise funds from the domestic debt market to clear outstanding loans issued by Bank of Uganda (BoU) in the past has triggered larger debt auction sizes, created liquidity challenges among commercial banks and stimulated higher funding costs for lenders, The EastAfrican has learnt.
Uganda’s Finance Ministry owes the central bank an estimated Ush10 trillion ($2.7 billion) in outstanding loans acquired in the past for financing various state projects, sources indicated.
