Payments for servicing external debt have shown a substantial increase, rising from $583.9 million (approximately UGX 2.17 trillion) to $816.3 million (around UGX 3 trillion), according to the Finance Ministry. This surge in payments has been reported for the period ending June 2023.
Details disclosed in the June debt statistical bulletin and the public debt portfolio analysis by the Ministry of Finance reveal that payments for external debt servicing have seen a growth of $232.4 million (equivalent to UGX 864.2 billion) from the 2021/22 financial year to the 2022/23 fiscal year.
This increase, as outlined in the analysis, can be attributed to higher expenditures related to principal, interest payments, and fees for major projects. Notably, this includes projects such as the Karuma and Nsimbe dams, Kabaale International Airport, and debt service for the Trade and Development Bank.
Furthermore, the Ministry of Finance reported that public debt has continued to rise, with the total increasing by $2.25 billion (approximately Shs8.3 trillion). This increase has taken the public debt stock from $20.97 billion (Shs77.9 trillion) as of June 2022 to $23.22 billion (Shs86.3 trillion) as of June 2023.
Of this total, approximately $9.4 billion constitutes domestic debt, making up 41 percent of the public debt portfolio, in contrast to the 59 percent represented by external debt.
Nevertheless, the analysis also noted a decline in the nominal value of public debt as a percentage of the gross domestic product. It dropped from 48.6 percent in June 2022 to 46.2 percent.
Data indicates that external debt increased from $12.8 billion (UGX 47.6 trillion) to $13.79 billion (UGX 51.2 trillion) due to an increase in disbursements for various projects and budget support. This increase saw significant disbursements, including $545 million (UGX 2.02 trillion) from Standard Bank and $196 million (UGX 728.8 billion) from Standard Chartered Bank.
Simultaneously, undisbursed debt decreased from $4.09 billion (UGX 15.2 trillion) to $3.29 billion (UGX12.2 trillion), primarily due to increased disbursements for deficit financing and development programs. Particularly noteworthy is the reduction in undisbursed debt from multilateral creditors, dropping from $2.99 billion to $2.41 billion, while that from bilateral creditors decreased from $1.08 billion (approximately UGX 4 trillion) to $860 million (around UGX 3.19 trillion).
The majority of Uganda’s external debt continues to come from multilateral lenders, including the International Development Association, International Monetary Fund, and African Development Fund, collectively accounting for 60.55 percent of the country’s external debt.