In the last 10 years government has been reducing dependence on donors. Indeed, the 2018/19 budget that was presented yesterday mirrors that effort. A...
In the last 10 years government has been reducing dependence on donors. Indeed, the 2018/19 budget that was presented yesterday mirrors that effort.
According to the budget speech, domestic revenue is projected to grow by Shs1.9 trillion to a total mobilisation of Shs16.358 trillion.
In his 2018/19 budget speech, Mr Matia Kasaija, the Finance minister, said out of the total domestic revenue projection, Shs15.938 trillion will be collected as tax revenue while Shs420b will be non-tax revenue.
Government, he said, will also finance the budget using domestic borrowing with Shs1.783 trillion expected from Treasury Bills and Bonds. Borrowing from donors. Government also expects to mobilise financing from external sources. About Shs7.734 trillion, out of which Shs6.148 trillion will be loans and Shs1.585 trillion grants, is expected from donors.
However, Ms Mira Clara, the IMF resident representative, told Daily Monitor yesterday that the 2018/19 budget has a higher deficit than it had been envisaged.
This, she said, will make achieving the Charter of Fiscal Responsibility targets difficult.
“Given the large needs, spending in health, education and social protection are essential to improve the quality of life of the population and boost growth,” she said, noting that interest payment, which makes up almost 20 per cent of revenue, reflects the rising debt levels.
The size of Uganda’s economy currently stands at Shs101.8 trillion, which is equivalent to $27.9b. In the 2017/18 financial year, export earnings rose by 9.6 per cent to $ 3.93b in the period July 2017 to March 2018 from $3.59b.
According to Mr Kasaija the increase was mainly on account of an increase in export volumes of beans, coffee, tea and maize. Over the same period, exports to the rest of the EAC grew from $792.3m to $943.5m while exports to Europe grew from $415.8m to $466.1m. Coffee exports have increased from 3.6 million 60 kilogramme bags in the 2015/16 financial year to 4.14 million bags between July 2017 and May 2018.
However, imports increased by 16.4 per cent at $ 5.7b in the period running July 2017 to March 2018 from $4.9b over the same period.
This was attributed to the increase in the prices of oil imports and the increased inflow of capital goods to support domestic investment, particularly in oil and gas, electricity.