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Press Release No. 17/04<br />
FOR IMMEDIATE RELEASE<br />
January 10, 2017<br />
International Monetary Fund<br />
Washington, D.C. 20431 USA<br />
IMF Executive Board Completes the Seventh Review Under the Policy Support<br />
Instrument for Uganda<br />
On January 5, the Executive Board of the International Monetary Fund (IMF) completed the<br />
seventh review of Uganda’s economic program under the Policy Support Instrument (PSI). 1<br />
The Board’s decision was taken on a lapse of time basis. 2 In completing the review, the<br />
Board granted a waiver of the nonobservance of the end-June 2016 assessment criterion on<br />
the overall deficit of the central government.<br />
The PSI for Uganda was approved by the Board on June 28, 2013 (see Press Release No.<br />
13/78), and a one-year extension was approved on June 6, 2016 (see Press Release No.<br />
16/263).<br />
Uganda’s economy has performed reasonably well in a complex environment. Growth<br />
slowed marginally to 4.8 percent in FY15/16, reflecting muted sentiment in an election year<br />
and adverse global and regional developments. The current account deficit improved by<br />
1 percentage point to 5.9 percent of GDP, and the Shilling has stabilized after a sharp<br />
depreciation in 2015. Growth is projected to nudge up to 5 percent in FY16/17.<br />
Program performance under the PSI has been mixed. Tight monetary policy in 2015 has<br />
helped contain inflation in the target range, and the Bank of Uganda (BoU) has started an<br />
easing cycle in April 2016. Reserve cover remains adequate. Fiscal revenue and deficit<br />
targets were missed, reflecting lower-than-expected growth and election effects. Investment<br />
spending fell short, while current expenditure overshot. Structural reforms have progressed,<br />
albeit with some delays.<br />
1<br />
The PSI is an instrument of the IMF designed for countries that do not need balance of payments financial<br />
support. The PSI helps countries design effective economic programs that, once approved by the IMF's<br />
Executive Board, signal to donors, multilateral development banks, and markets the Fund's endorsement of a<br />
member's policies (see http://www.imf.org/external/np/exr/facts/psi.htm). Details on Uganda’s current PSI are<br />
available at www.imf.org/uganda.<br />
2<br />
The Executive Board takes decisions without a meeting when it is agreed by the Board that a proposal can be<br />
considered without convening formal discussions.
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