Uganda commits to IMF reforms, seeks cheaper financing

KAMPALA. Uganda has committed to implementing a new programme with the International Monetary Fund (IMF), with the government seeking cheaper financing and promising reforms to strengthen public finances and improve investor confidence.

The Finance Minister, Mr Henry Musasizi, said Uganda was ready to implement the new Extended Credit Facility (ECF) programme based on agreed prior actions.

He made the remarks after meeting Mr Zeine Zeidane, the IMF Director of the African Department, on the sidelines of the ongoing 2026 IMF-World Bank annual meetings in Bangkok, Thailand.

Mr Musasizi said the programme would help strengthen confidence in Uganda’s economic policies, improve the country’s credit rating and enable it to secure more concessional financing.

The discussions covered fiscal consolidation, monetary policy, domestic revenue mobilisation, tax policy, expenditure management, supplementary budgets, governance and structural reforms.

The meeting was attended by the Secretary to the Treasury, Mr Ramathan Ggoobi, and the Bank of Uganda Governor, Dr Michael Atingi-Ego, who responded to issues raised by the IMF official.

Mr Ggoobi said the government was committed to implementing reforms aimed at increasing Uganda’s tax-to-GDP ratio from about 14 per cent to at least 20 per cent.

He added that any proposed tax measures would be incorporated into the Budget Framework Paper for the 2027/28 financial year.

Raising the tax-to-GDP ratio would require the government to collect more revenue relative to the size of the economy, reducing reliance on borrowing to finance public expenditure.

However, the proposed measures are likely to require difficult decisions on taxation and spending as the government seeks to balance revenue mobilisation with economic growth and household welfare.

The government’s discussions with the IMF come amid broader efforts to strengthen fiscal discipline, improve public expenditure management and address concerns over the sustainability of public finances.

Africa’s economic priorities

At a separate meeting of the IMF Africa Group 3 Constituency, of which Uganda is a member, policymakers discussed global economic pressures, debt, fiscal adjustment, exchange rate flexibility, subsidy reforms and Africa’s representation in global financial governance.

Mr Zeidane urged governments to maintain economic stability while protecting vulnerable households from the effects of reforms.

“Policy makers should not lose sight of growth and reforms that make economies more resilient to future shocks,” he said.

The meeting also identified reliable electricity, improved digital connectivity, stronger skills development, a predictable business environment, private sector expansion and job creation as priority areas for African economies.

For Uganda, access to concessional financing could help reduce the cost of borrowing, while stronger revenue collection and spending discipline would be central to meeting the objectives of the proposed IMF programme.

The government’s ability to implement the agreed reforms will be important in determining whether the programme strengthens investor confidence and creates room for more sustainable financing of development priorities.