By Silvia Nyambura
Uganda’s economy is projected to grow at 5.8 percent in the next financial year, the Minister of Finance Matia Kasaija has said. This is pegged largely on account of the recovery in private sector consumption, as well as acceleration in both public and private investment. In addition, government will continue to invest heavily in infrastructure over the next few years.
Making his maiden budget speech this afternoon, Kasaija said this strategy will address the constraints to private sector growth and increase efficiency in service delivery.
Development expenditure is budgeted to grow by 58% for financial year 2015/2016 mainly driven by major infrastructure projects like rehabilitation of Entebbe International Airport, new roads and the Karuma and Isimba hydropower projects.
“This represents 11.29 % of GDP next year compared to 7.95% this year,” he said.
The key focus areas in this year’s budget include;
-Maintenance of National Security and Defense
-Facilitation of Private Sector Enterprise Development
-Effective Development and Maintenance of Infrastructure
-Commercialization of Agriculture and Improved Productivity in Primary Growth Sectors;
-Enhanced Capacity for Increased Domestic Revenue Mobilization
-Increased Social Service Delivery
-Enhanced Efficiency in Government Management
Out of the approved budget of Ushs 24 trillion, Ushs 17.3 trillion is allocated for spending by Ministries, Departments and Agencies (MDA’s), which includes statutory expenditures amounting to Ushs 1.1 trillion. Government expects to receive external financing equivalent to Ushs. 5.65 trillion in grants and loans, of which Ushs 1.09 trillion is grants, Ushs 1.326 trillion is concessional loans, and Ushs 3.23 billion is non-concessional loans.
The transport sector takes the biggest chunk of the budget with an allocation of Ushs 3.3 trillion. This represents 18.2% of the total resource allocation for next financial year. The Education sector gets the 2nd largest share with Ushs 2.03 trillion to enhance access and quality of education and skills development.
Ushs 1.632 trillion has been earmarked for the security sector.
“These resources will be utilized to further professionalize the armed forces and other security organs. Specific emphasis will be placed on the acquisition of modern weaponry, strengthening intelligence capability, training and welfare,” Kasaija said.
The health sector gets Ushs 1.27 trillion while the Water and Sanitation, Agriculture and Tourism sectors receive Ushs 547.3 billion, Ushs 479.96 billion and Ushs 30.8 billion respectively.