The Ministry of Finance. Planning and Economic Development has revealed that Uganda’s public debt has now hit the Shs87Trn mark, and the largest share of debt contracted coming from external lenders, with the World Bank featuring as the top lender to Uganda.
The details are contained in the Debt Statistical Bulletin and Public Debt Portfolio Analysis for June 2023 published by the Directorate of Debt and Cash Policy of the Ministry of Finance, to which the Secretary to Treasury, Ramathan Ggoobi described the publication as a strategic tool that aids fostering a deeper understanding of Uganda’s debt landscape writing, “It empowers us to make informed decisions develop effective policies and engage in purposeful dialogue with you our esteemed partners.”
“Public debt continues to rise as such, total public debt stock increased from US$20.97Bn (Shs78.495Trn) as at June 2022 to US$23.22Bn (Shs86.918Trn) as at the end June 2023. In particular external debt increased from US$12.8Bn (Shs47.915Trn) in June 2022 to US$13.79Bn in June 2023, while domestic debt increased by US$1.27Bn from US$8.2Bn in June 2022 to US$9.4Bn in June 2023. Consequently, external debt now constitutes 59% of total debt stock, while domestic debt shares 41% of the same indicator,” read in part the report.
The Ministry of Finance attributed the increase in external debt on increased disbursements for budget support to fund some critical projects while the increase in domestic debt was primarily due to issuances to finance budgetary expenditure and redemptions.
Government further broke down the composition of Uganda’s debt stock indicating in the report that external debt stock increased from US$12.81Bn (Shs47.915Trn) in June 2022 to US$13.79Bn (Shs51.621Trn) in the year ending June 2023.
The Ministry of Finance explained that the increased disbursements for both project and budget support to finance the government deficit explains growth in external debt and these disbursements were significant for budget support equivalent to US$545Mn (Shs2.039Trn) from Standard Bank and US$196Mn (Shs733.536Bn) from Standard Chartered Bank.
While profiling the lenders behind Uganda’s debt, the Ministry of Finance revealed that multilateral creditors continue to form the largest share of Uganda’s external debt stock accounting for 60.55% of Uganda’s debt which is (US$8.35Bn) and the major multilateral creditors include; International Development Association-World Bank, International Monetary Fund (IMF) and African Development Fund with the trio holding the largest share of Uganda’s external debt stock, equivalent to 51.06% (US$7.04Bn) of external debt portfolio.
The report further indicated that the other multilateral creditors are; African Development Bank, Islamic Development Bank and International Fund for Agriculture held 9.49% equivalent to US$1.31Bn as at end June 2023.
For the total domestic debt stock, the Ministry of Finance revealed that this too increased from Shs30.661Trn in June 2022 to Shs34.574Trn in June 2023.