THE start of commercial crude oil production in Uganda is expected to propel economic growth into double digits in the next financial year, the International Monetary Fund (IMF) said.
Uganda’s economy would race to 10.8% growth in the 2025/2026 fiscal year which starts in July, up from a projection of 6.2% in the previous period, the IMF said in a report published late on Wednesday.
“Growth is expected to strengthen, boosted by the start of oil production, which will make (a) lasting improvement (to) the fiscal and current account balances,” the IMF said in the report.
After nearly 20 years of delay, the east African country is finally expected to commence production and export of crude oil next year from fields in its west.
Commercial reserves were discovered in 2006 but a range of factors including disputes with oil firms over development strategy and lack of requisite infrastructure had delayed production.
At peak, Uganda is seen pumping 240,000 barrels of oil per day from its reserves, which are estimated at 6.5 billion barrels.
The IMF said Uganda’s foreign exchange (FX) reserves had continued to decline, and urged intervention by the central bank including a “reduction in government imports, along with stepped up FX purchases and greater exchange rate flexibility.”
The country’s FX reserves fell to $3.2 billion in June, down from $3.7 billion in December 2023, because of the high cost of servicing debt, the government’s inability to secure cheap credit, and limited hard currency purchases, the IMF said.
(Credit:Reuters).
Time is now to consider investing in Uganda. Crude Oil Production is going to help improve all sectors of the economy. Unlike many other African Countries which produce crude oil, the Government of Uganda took a lot of time to do research and ended up successfully introducing a strict “ Local Content” policy which is highly beneficial to the economy. Purchasing power of Ugandans is anticipated to increase significantly in the next few years.
The middle geographical location of Uganda is also favourable. The country serves as a shopping centre for South Sudan and Eastern Democractic Republic of Congo. Manufacturers based in Uganda export easily their goods to Rwanda, Burundi, South Sudan, Eastern DRC, Kenya and Tanzania.
We call upon everyone to hurry up, come and invest in Uganda before you miss the bus. If you need our help, we will assist you.
