Uganda’s budget deficit may narrow to six percent of gross domestic product (GDP) in the financial year 2019-20, as the country winds up investments in two big hydropower projects, the Finance Ministry has said.
The financing gap in the 12 months through June 2020 may drop from 6.6 per cent of GDP this fiscal year as the government completes the 600MW Karuma and 183MW Isimba hydropower dams, according to the latest National Budget Framework Paper.
The fiscal shortfall is expected to gradually narrow to 2.6 per cent of GDP in financial year 2023/24 on the phased reduction in big public investment projects, according to the pre-budget document.
Uganda sees resources in the coming fiscal year rising to Ush34.3 trillion (US $9.2 billion) from Ush32.7 trillion (US $8.78 billion) in 2018-19, according to the document.
The Government will allocate Shs2.9 trillion (US $778.9 million) for interest payments in the next fiscal year, of which Shs402.4 billion (US $107.9 million) will be for external loans, the ministry said.