The International Monetary Fund's board of directors has authorized the immediate delivery of around $120 million (Ush440.4 billion) to Uganda, while warning of higher risks, particularly the recent consequences from the passage of the Anti-Homosexuality Act.
The funds were made available through the Extended Credit Facility (ECF) arrangement, which provides medium-term financial assistance to low-income countries with long-term balance-of-payments problems, such as Uganda, in order to implement economic programs that make significant progress toward a stable and sustainable macroeconomic position consistent with strong and sustainable poverty reduction and growth.
According to Uganda's Finance Ministry Permanent Secretary and Secretary to the Treasury, Mr. Ramathan Ggoobi, who quoted an IMF statement announcing the transfer of the money, Uganda is on a "steady path to full recovery, sustained growth, and reform for socio-economic transformation."
Its goal is to aid in the short-term reaction to the Covid-19 outbreak while also promoting more inclusive private-sector-led long-term prosperity.
Reforms aim to provide budgetary flexibility for priority social expenditures, maintain debt sustainability, promote governance and reduce corruption, and improve the monetary and financial sector frameworks.
While the Quantitative Performance Criterion (QPC) on the ceiling on the Bank of Uganda's (BoU) net credit to government (NCG) was missed by a very narrow margin in March 2023, the IMF reports that all structural benchmarks due between March and June 2023 have been satisfied. QPCs are particular objectives or benchmarks that a nation must fulfill in order to obtain IMF financial assistance or to remain eligible for continuous support.
As a result, the lender provided a waiver of non-compliance with a performance condition on the BoU's net credit limit to the government.