13 April 2018

Uganda: US Raises Concern Over Uganda's Rising Debt

Kampala — The government must begin to rein on her "overzealous" appetite to borrow before it is too late, the US ambassador to Uganda, Ms Deborah Malac, has said.

Speaking to journalists yesterday at the US Embassy in Kampala, Ms Malac said the level at which the government is borrowing, if not controlled, could impact the quality of service delivery.

"We are concerned about the rising debt levels because we have been through that experience. With high debt level, you end up using so much to service the debts and that takes away what you would have used to deliver services," she said.

A decade after global debt movements campaigned for debt cancellation, many African countries, including Uganda, are either in debt difficulties or quickly degenerating into debt.

Currently, 30 per cent of the National Budget is servicing interest on Uganda's rising debt.

Debt status

By the end of 2016, Uganda's external and domestic public debt amounted to $ 8.7 b (about Shs32 trillion).

Although government says this is below a 50 per cent threshold beyond which public debt becomes unsustainable, the concern is the rate at which the debt is incurred.

According to Uganda Debt Network Research, the Total Public Debt for Uganda by June 2017 (end of FY 2016/17) was in excess of $13 billion (about 47.5 trillion).

Speaking about African Growth and Opportunity Act (Agoa), Ms Malac said Uganda has not properly taken advantage of the deal, adding that it will be sad if the pact comes to an end.Agoa was renewed in 2015 for 10 years.

The ambassador said the US was willing to help Uganda improve in areas that will see her take full advantage of Agoa.

On the agreement the government signed with a consortium of American and Italian firms to finance and construct a $4-billion refinery in Hoima District, Ms Malac said it was timely and that they will keep their part of the bargain.

Uganda

Is Museveni's Proposal On Snipers for MPs Workable?

With MPs scared out of their wits following a spate of high-profile assassinations, President Museveni has ordered that… Read more »

See What Everyone is Watching

Copyright © 2018 The Monitor. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 800 reports a day from more than 140 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.