KAMPALA (Reuters) – Uganda’s public debt surged 15% in 2021, finance ministry data showed on Wednesday, as the east African country soaked up fresh debt to finance post-pandemic recovery and shore up sagging revenues.
Total public debt in the prospective crude oil producer ballooned to $21 billion at the end of December last year from about $18 billion in the previous period, according to data obtained by Reuters.
As a percentage of gross domestic product, the country’s public debt is now just shy of 50%.
Uganda’s opposition has long criticised the government of president Yoweri Museveni for what they say is unbridled borrowing that is swallowing precious resources in repayments that could otherwise be used to invest in sectors like education and health.
The central bank has also previously expressed concerns https://www.reuters.com/article/ozabs-uk-uganda-debt-idAFKCN1002BC about Uganda’s public indebtedness.
A finance ministry official told Reuters the spike in debt last year “was to finance the shortfalls in domestic revenue” caused by the economic effects of the COVID-19 pandemic.
Uganda implemented one of the Africa’s most sweeping and severe lockdowns which included shutting down nearly all businesses, education institutions and halting vehicle traffic for months.
The stern approach to taming the pandemic helped lower infections and fatalities but precipitated a deep economic slowdown as businesses reeled and tax revenues plummeted.
(Reporting by Elias Biryabarema; Editing by Hereward Holland and James Macharia Chege)
