The International Monetary Fund (IMF) projects Uganda’s economic growth to slow down to 3.5 to 4 percent in 2016/17 financial year, down from the earlier anticipated 5 percent due to drought and slow credit growth.
“The drought held back activity in the first part of the year. Private sector credit is an additional drag,” IMF said in a statement issued on Tuesday.
The Fund together with Bank of Uganda and the Ministry of Finance top officials met at the latter’s head offices in Kampala to discuss the plight of the Ugandan economy that has been wobbly for about two years now.
The Fund however expects growth in the 2017/18 fiscal year to pick up to 5 percent.
The Fund added that Uganda’s banking sector is well-capitalized, but credit growth remains subdued.
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