Overview:
According to Ggoobi, Uganda’s oil and gas sector developments coupled with the government investment in agriculture will see inflation drop significantly and create more jobs.
The Permanent Secretary in the Ministry of Finance, Planning and Economic Development, Mr Ramathan Ggoobi, has said despite the multiple economic challenges over the last three years due to Covid-19 and high inflation, there are very good prospects that the Ugandan economy will recover in 2023.
According to Ggoobi, Uganda’s oil and gas sector developments coupled with the government investment in agriculture will see inflation drop significantly and create more jobs.
“The good news is that the future is bright, we can see where we are going,” he said during a talkshow on NTV Uganda on Thursday.
Ggoobi said Uganda has remained resilient and even registered some growth in industrial sector (import substitution), recovery of agricultural sector, growth in regional trade and developments in oil and gas coming with about USD 3.4bn for investment in the sector.
“The major driver of inflation in Uganda is food. Whenever food prices rise as a result of either shortage, inflation tends to rise too because food contributes significantly to our basket,” he said.
He explained that Uganda’s investment in the Parish Development Model will help Ugandans have cash in the pocket while promoting agricultural growth.
Ggoobi said a robust system has been put in place to regulate access to PDM money and to particularly curtail elite capture of the programme.
“It’s the reason money is not moving very fast. We are removing middlemen of people’s money,” he said.
Ggoobi also said the first half of the financial year, up to December has been financed largely by internally generated revenue.
“Uganda’s administrative capacity has also been growing. John [Musinguzi – URA Commissioner General] and his team have been working on getting more efficient. We have had challenges of tax collectors themselves conniving with the would-be taxpayers,” he says.
“We stopped imposing new taxes which have not been studied and we have instead decided to get tax from those who have been evading,” he adds.
According to Ggoobi, Uganda’s debt stock as of June 2022 was 78 trillion shillings and that translates into 48.4 % of the country’s GDP.
“Of that we are servicing debt at a tune of 8.5 trillion shillings of which 6.1 is interest and 2.4 is going to be amortisation,” he says.