External factors will shape Uganda's near-term growth

Subject

Ugandan economic outlook.

Significance

Despite having overcome the 2016 election with relatively little economic turbulence, Uganda's growth has since failed to accelerate despite monetary easing. The economy is still vulnerable to external economic shocks. The government is investing in public infrastructure to reduce this weakness in the longer-term.

Impacts

• Selecting, sequencing and implementing choices of large projects will determine the success of public infrastructure investment.
• Insufficient increases in tax collection will force the government to borrow more from domestic and international markets.
• Kenya's experience with a new interest rate cap law could influence Uganda's banking regulations.