Overview:

Kasaija said the strategy comes at a decisive moment, with Uganda already making significant gains in its socio-economic transformation journey.

The Government of Uganda has unveiled a bold budget strategy that sets the country on course to grow its economy tenfold and attain upper-middle-income status before 2040.

This was revealed on Thursday, September 11, 2025, at the opening of the National Budget Conference for the Financial Year 2026/27, where Finance Minister Matia Kasaija presented the Budget Strategy before ministers, policymakers, and development partners.

Kasaija said the strategy comes at a decisive moment, with Uganda already making significant gains in its socio-economic transformation journey. The Minister noted that the country has successfully transitioned from the Least Developed Country (LDC) category to lower-middle-income status, buoyed by sustained peace, macroeconomic stability, and heavy investments in infrastructure and institutional reforms.

“Uganda has diversified its exports beyond the traditional three Cs — Coffee, Cotton, and Copper — and the three Ts — Tea, Tourism, and Tobacco. We are now opening up regional and continental markets with a shared national consensus to grow the economy tenfold by 2040,” Kasaija declared.

Economic Growth and Transformation

The Finance Minister reported that Uganda’s economy grew by 6.3% in FY 2024/25, up from 6.1% in FY 2023/24. The growth was driven by government spending through the Parish Development Model (PDM), expansion in industrial output, tourism, and renewed investments in the oil and gas sector.

Kasaija further revealed that through various wealth funds, government has so far injected Shs. 10.2 trillion into the private sector, while strengthening the financial system with digitisation, financial literacy initiatives, and improved mechanisms for dispute resolution in courts of law.

Looking ahead, the economy is projected to grow by 7% in FY 2025/26 and at least 8% annually over the next five years. The start of commercial oil and gas production in 2026 is expected to catapult growth into double digits.

Public Debt Remains Sustainable

Addressing concerns over rising borrowing, Kasaija reassured the nation that public debt remains sustainable. By June 2025, Uganda’s debt stock stood at USD 32.33 billion (Shs. 116.21 trillion), up from USD 25.63 billion (Shs. 94.72 trillion) a year earlier. Domestic debt accounted for USD 16.8 billion, while external debt stood at USD 15.54 billion, translating into a 51.3% debt-to-GDP ratio—within sustainable limits.

The Minister explained that the debt increase was largely due to financing for major infrastructure projects, with domestic borrowing rising to 51.9% of the total debt stock.

Financing Strategy for FY 2026/27

To accelerate Uganda’s Tenfold Growth Strategy, Kasaija outlined six key financing pillars:

  1. Reprioritisation of resources within the current fiscal framework.
  2. Boosting domestic revenue mobilisation.
  3. Attracting more Foreign Direct Investment (FDI) through macroeconomic stability, infrastructure development, and better governance.
  4. Fast-tracking Public-Private Partnerships (PPPs).
  5. Exploring innovative financing models beyond traditional loans.
  6. Leveraging sustainable financing through national wealth funds such as UDB, UDC, ACF, SBRF, and Emyooga.

The budget strategy will anchor investments on four key objectives:

  • Value addition in agriculture, minerals, oil & gas, and tourism.
  • Scaling up science, technology, and innovation.
  • Strengthening enablers like transport, energy, irrigation, industrial parks, education, health, and security.
  • Enhancing domestic revenue and regional integration.

Prime Minister’s Call to Action

In her opening remarks, Prime Minister Robinah Nabbanja urged ministers and accounting officers to align their priorities with the Anchor Growth Sectors of Agro-Industrialisation, Tourism, Mineral-Based Industrial Development, and Science, Technology, and Innovation (ATMS).

She stressed the need to lift the 33% of Ugandans still in subsistence economies into the money economy, leveraging government wealth creation programmes such as PDM, Emyooga, the Youth Venture Fund, and the Uganda Development Bank.

“Our collective responsibility is to deepen the implementation of the ATMS sectors and reduce reliance on domestic and external borrowing. We must boost revenue collection to secure Uganda’s development path,” Nabbanja said.

Outlook

The FY 2026/27 Budget Strategy is positioned as the first accelerator phase of Uganda’s Tenfold Growth Agenda. With oil and gas production on the horizon, stronger regional market integration, and deepening structural reforms, government is betting on an ambitious yet calculated growth path to deliver prosperity and transform Uganda into an upper-middle-income economy within the next 15 years.