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CSOs Call for Urgent Action on Debt, Growth and Sustainability

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CSOs Call for Urgent Action on Debt, Growth and Sustainability
Budget

Uganda’s total public debt surged to Shs94.7 trillion as of June 2024, marking an 11.6% increase from Shs84.8 trillion the previous year.

Civil society organisations (CSOs) have raised alarm about Uganda's escalating debt burden, environmental degradation, and slow growth targets during a press conference on the FY 2025/26 National Budget Framework Paper (NBFP).

Under the theme, “Navigating Ambitious Growth Goals Amidst a Shrinking FY 2025/26 Budget,” the CSOs presented stark revelations that paint a challenging picture of Uganda's economic and environmental future.

Uganda’s total public debt surged to Shs94.7 trillion as of June 2024, marking an 11.6% increase from Shs84.8 trillion the previous year.

External debt accounts for 57.2% of this, while domestic debt makes up 42.8%.

The International Monetary Fund (IMF) projects the debt could rise to Shs110.6 trillion by the end of FY 2024/25, raising concerns about its sustainability.

Policy analyst Pascal Muhangi highlighted inefficiencies in debt utilization.

Over the past 11 years, the government borrowed Shs43.25 trillion, but only Shs26.84 trillion was used, leaving Shs16.4 trillion unspent.

“This indicates a lack of preparedness by the government before acquiring debt,” Muhangi said, calling on policymakers to focus on efficient planning and execution.

The Civil Society Budget  Advocacy Group (CSBAG) underscored the need for Uganda to achieve an average annual GDP growth rate of 13.7% to meet its target of $500 billion by FY 2039/40.

However, the growth rate for FY 2023/24 was only 6.1%, well below the necessary target.

CSBAG estimates that to avoid stagnation, the growth shortfall should not exceed five percentage points annually.

Muhangi further noted that the three dominant GDP sectors services, agriculture, and industry—must each grow at a minimum rate of 13.7% annually to meet the goal, a daunting challenge given current limitations.

Environmental degradation, particularly wetland encroachment, remains a significant threat to Uganda’s sustainability goals.

According to a United Nations Development Programme (UNDP) report, Uganda’s wetland coverage has declined by 25% over the past two decades, shrinking from 30,000km² in 2000 to 22,500km² by June 2023.

Jonathan Lubega, a policy analyst with SEATINI Uganda, criticized the government for prioritizing industrial expansion over environmental conservation, warning that this could undermine biodiversity and climate resilience.

The Uganda National Bureau of Standards (UNBS) has struggled to enforce quality standards due to chronic underfunding and understaffing.

Advocacy officer Lawrence Kanakulya revealed that the bureau received only Shs940 million in FY 2023/24 and FY 2024/25, leaving farmers vulnerable to counterfeit agricultural products.

The CSOs urged the government to adopt better debt management strategies, invest in high-growth sectors, enforce environmental conservation policies, and adequately fund institutions like UNBS.

“Uganda’s economic aspirations must align with practical and sustainable strategies,” Kanakulya emphasized.

“Without addressing these critical challenges, the country risks derailing its growth trajectory and undermining its long-term development goals.”

As the FY 2025/26 budget framework takes shape, these revelations serve as a sobering reminder of the urgent need for accountability, inclusivity, and sustainability in Uganda’s policymaking.

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