KAMPALA (Askume) – Uganda is expected to achieve double-digit economic growth in the next financial year as commercial crude oil production resumes, the International Monetary Fund (IMF) said.
Uganda’s economy will grow 10.8% in the 2025/2026 fiscal year that begins in July, up from 6.2% in the previous fiscal year, the International Monetary Fund said in a report released Wednesday night.
“The resumption of oil production is expected to strengthen economic growth, leading to a lasting improvement in the fiscal and current account balances,” the IMF said in the report.
After a delay of almost 20 years, the East African countryFinally, production and export of crude oil from the western fields is expected to begin next year.
Commercial reserves were discovered in 2006, but production was delayed for a variety of reasons, including disputes with oil companies over development strategies and a lack of necessary infrastructure.
At its peak, Uganda extracted 240,000 barrels of oil per day from its reserves, estimated at 6.5 billion barrels.
The International Monetary Fund said Uganda’s foreign exchange reserves continued to decline and urged the central bank to intervene, including “by reducing government imports as well as increasing foreign exchange purchases and improving exchange rate flexibility”.
The International Monetary Fund said the country’s foreign exchange reserves fell to $3.2 billion in June from $3.7 billion in December 2023. This is due to high debt service costs, the government’s lack of access to cheap debt and limited currency purchases.
