Uganda Approved For SHS455B Credit From IMF Following Due TO Excellent Performance

Uganda received 722 million SDRs under the Extended Credit Facility from IMF in June 2017 to assist the government in combating the COVID-19 epidemic. And the approval enabled an immediate disbursement of $258 million.

The Fund’s board of directors approved the immediate distribution of 127 million dollars under the Extended Credit Facility Arrangement. With the current payment, the total exceeds 1.38 trillion Shillings.

The IMF stated that notwithstanding the epidemic, the Ugandan authorities remain committed to the Extended Credit Facility Arrangement and are carrying out their reform plan. This results in slower growth and additional funds for the government to help close the revenue gap created by the lockout and assist the poor, the IMF believes.

A report from the Fund says that Uganda’s government has kept the economy going, even though the country’s economy isn’t growing as quickly as it should. The report predicts that the country’s GDP will grow by 3.8% in 2022/23. The Fund says that even though there were problems and delays, all quantitative performance standards were met, and the reform agenda is moving forward.

Despite the obstacles, Ugandan officials remained committed to their economic agenda. The program has been quite successful. According to an IMF Deputy Director, all quantitative objectives had been met with the exception of one, and all structural objectives had been satisfied with the exception of three.

According to the fund, some resource reallocation was necessary to deal with the pandemic’s second wave and rising security tensions. This was precipitated by terrorist bombings in Uganda and ADF rebel threats. Uganda used its resources to fight in the Democratic Republic of the Congo.

This is the recommendation of the IMF to the government. A merry Finance, Planning, and Economic Development Ministry. They assert that, despite various pressing financial requirements, they exercised greater fiscal restraint.

We have the lowest debt-to-GDP ratio in the region. Permanent Secretary of the Ministry of Finance Mr Ramathan Ggoobi stated that the Ministry is minimizing commercial borrowing and pursuing low-interest loans.

Despite the IMF’s favourable assessment, the administration has been accused of financial mismanagement in the aftermath of the COVID-19 outbreak. The Auditor-General states that 676 billion Shillings have been awarded to various ministries, agencies, and organizations to increase liquidity in the local business sector.

The IMF launched the Rapid Credit Facility in May 2020. (RCF). Covid-19 resulted in immediate balance-of-payments and budgetary requirements. It was used to help finance health, social, and macroeconomic stabilization efforts. Additionally, the RCF assisted in raising funding from other countries.

About IMF

According to Wikipedia, The IMF has 190 member countries. As stated on its website, it seeks to “advance global economic growth and employment while eradicating global poverty.” It was created in 1945 with 29 member countries to recreate the international monetary system. Modern-day balance of payments concerns and global financial crises require it. Countries donate funds to a pool from which countries in need of borrowing might draw.