Presenting the 2025/26 national budget to Parliament, Finance Minister Matia Kasaiaja has lauded the country’s economic performance, describing it as “among the fastest-growing in the world,” and projected Uganda to become the fastest-growing economy by 2031, according to recent research by the Harvard Growth Lab.
Kasaija said Uganda’s economy is on a strong upward trajectory with the Parish Development Model (PDM) emerging as a key pillar in the country’s wealth creation and poverty alleviation strategy.
“This remarkable growth,” said Kasaija, “has been achieved despite numerous domestic, regional and global shocks. It is a testament to the unique economic ideology championed by His Excellency the President — grounded in patriotism, Pan-Africanism, democracy, and socio-economic transformation.”
Central to this transformation, the minister emphasized, is the Parish Development Model. “By 30th June this year, a total of Shs3.3 trillion will have been transferred to the 10,589 parishes across the country,” Kasaija noted.
He added, “Each parish gets Shs100 million annually. So far, the PDM funds have reached 2.63 million beneficiaries across all districts and parishes.”
He said beneficiaries have invested 45% of the funds in crops like maize, cassava, onions, bananas, and Irish potatoes, 36% in livestock, 12% in poultry, and the rest in other enterprises. “These investments are changing the lives of Ugandans by boosting household incomes, enhancing food security, and creating employment opportunities at the grassroots,” Kasaija declared.
The PDM, he said, has now been fully digitized, ensuring transparency, efficiency, and direct transfers to intended recipients through the National Identification Number (NIN) and the PDM Information System (PDMIS).
Minister Kasaija reported that over the past decade, the government has committed Shs9 trillion towards wealth creation, channelled through various initiatives such as Uganda Development Bank, Emyooga, Youth Livelihood Programme, the Agricultural Credit Facility, and the INVITE and GROW projects. These interventions, he said, are aimed at integrating all Ugandans into the money economy.
“Our budget for the next financial year, and over the medium term, is focused on people and wealth creation,” he said. “The theme remains: Full Monetisation of Uganda’s Economy through Commercial Agriculture, Industrialisation, Expanding and Broadening Services, Digital Transformation and Market Access.”
Uganda’s economy is estimated to grow by 6.3% in 2024/25, with projections to accelerate to 7.0% in 2025/26 — and even hit double-digit growth once oil and gas production begins. Nominal GDP is projected to hit Shs254.2 trillion (USD 66.1 billion) in the next fiscal year, up from Shs226.3 trillion this year.
“Uganda has achieved these milestones because of a deliberate and consistent strategy. Peace, political stability, and investment in infrastructure have laid a firm foundation for sustainable development,” Kasaija said.
He outlined key improvements: life expectancy has risen from 63.3 years in 2010/11 to 68.2 years in 2023/24; access to electricity jumped from 11% to 57%; and poverty fell to 16.1%, down from 24.5% in 2010/11. Income inequality, measured by the Gini coefficient, declined from 41% in 2020 to 38% in 2024.
“Uganda’s economy has moved from one reliant on the traditional 3Cs (coffee, cotton, copper) and 3Ts (tea, tobacco, tourism) to one that exports 31 new products, including pharmaceuticals, processed food, ceramics, and electronics,” said the minister. “The number of factories has grown from 31,757 to 50,000 since 2010/11.”
Kasaija credited the President’s “deliberate strategy to expand the share of manufactured exports” for increasing Uganda’s economic complexity. “Uganda has become more sophisticated in its exports than its income level suggests. This is proof that our industrialisation agenda is working.”
On the external front, Uganda’s exports of goods and services reached $11.8 billion in the 12 months to March 2025, up from $9.56 billion the previous year. Coffee exports, in particular, soared past the $1 billion mark and are expected to double to $2 billion annually.
“It took us more than a century to reach a billion dollars in coffee exports,” Kasaija noted.
He noted, “But now, in just one year, we are doubling that. I therefore implore Ugandans to grow more coffee and, most importantly, to add value before we export.”
Tourism and foreign direct investment also recorded robust performance. Tourism earnings rose to $1.52 billion, and FDI inflows surged to $3.48 billion. “Uganda remains one of Africa’s top investment destinations,” Kasaija said. “Our shilling was ranked the most stable currency in Africa by the IMF.”
Inflation, the minister assured, remains under control at 3.4% as of May 2025, well below the policy ceiling of 5%. The stability is due to increased food production under PDM, prudent fiscal and monetary coordination, and Uganda’s direct petroleum importation through UNOC.
“Contrary to conventional economics, our borrowing has not crowded out private credit,” Kasaija explained. “Instead, it has enabled the government to inject affordable financing into strategic sectors.”
As Uganda enters a new planning phase under the Fourth National Development Plan (NDP IV), the minister expressed confidence that the Tenfold Growth Strategy aimed at expanding Uganda’s economy to $500 billion by 2040 is now firmly underway.
“We have built a resilient, inclusive, and increasingly sophisticated economy,” Kasaija concluded. “Let us all support these wealth creation efforts so that no Ugandan is left behind.
