By David Mwanje
The World Bank has commended Uganda’s economy for strong growth and steady recovery, driven by agriculture, rising exports, and stable inflation.
In its latest Uganda Economic Update, the Bank projects the economy to grow by 6.3 percent in the 2024/25 financial year, placing Uganda among the fastest-growing economies in Sub-Saharan Africa.
Growth is being supported by improved performance in agriculture, tourism and exports, particularly coffee and gold. Coffee exports now bring in about USD 2 billion annually, helped by reforms under the government’s Coffee Roadmap.
Inflation has remained low at around 3.5 percent, below the Bank of Uganda target, supported by tight monetary policy and stable food supplies. Foreign exchange reserves have risen to USD 4.3 billion, covering three months of imports.
The World Bank says agro-industrialisation is becoming a major growth driver as agriculture shifts from subsistence farming to value addition through processing and organised farmer groups. Small and medium agro-processing enterprises have helped create jobs and raise incomes at community level.
The report notes increased government spending on infrastructure and social services, which pushed the fiscal deficit to 6.1 percent of GDP, but describes the spending as strategic. Tax revenue also increased by 16 percent, helped by digital systems at the Uganda Revenue Authority.
Looking ahead, the Bank expects faster growth once oil production begins. With the Tilenga and Kingfisher projects more than 60 percent complete, economic growth could rise to nearly 10 percent by 2026/27.
The World Bank advises Uganda to invest more in irrigation, mechanisation and climate-smart agriculture, and to attract private investment into agribusiness.
Finance Minister Matia Kasaija welcomed the report, saying it shows government policies are delivering results.
Despite challenges such as climate change and global uncertainty, the World Bank says Uganda remains on track for sustained long-term growth if current reforms continue.
