Uganda surpassed the Millennium Development Goals (MDGs) targets by halving poverty by 2015, and made significant progress in reducing the proportion of the population that suffers from hunger, as well as in promoting gender equality and empowering women. According to the Uganda Poverty Assessment, the proportion of the population living in extreme poverty (on less than $1.90 a day) fell from 62.2% in 2002/2003 to 34.6% in FY13, representing the second fastest reduction in poverty in Sub-Saharan Africa. Using the national poverty line (less than $1.25 a day), the incidence of poverty declined from 56.4%in 1993 to 19.7% in 2013. Good weather and favorable prices in the international and regional markets increased real income from crops, allowing agricultural households to account for up to 79% of the poverty reduction during this period. Other key contributing factors include urbanization and education.
Notwithstanding this progress, vulnerability to falling back into poverty is very high—for every three Ugandans who get out of poverty, two fall back in, demonstrating the fragile gains. Extreme poverty is concentrated in the north and east of the country, accounting for 84% of those beneath the national poverty line.
Following weak and late rains in 2016, the country experienced an acute food shortage, and up to 1.6 million people were food insecure and a further 9.3 million were reported to be food stressed, according to a National Food Security Assessment survey supported by the Bank.
Uganda is now the largest refugee hosting country in Sub-Saharan Africa, with more than 800,000 South Sudanese refugees, according to a March 2017 update from the UN Refugee Agency. On average, the country receives 2,218 refugees daily, and a further 500,000 could arrive during 2017.
World Bank Group Engagement
The World Bank Group (WBG) Country Partnership Framework (CPF) for the period 2015/16 to 2020/21 supports the government’s vision of a society transformed from a peasant economy to a modern and prosperous country by 2040. The CPF has been prepared in close collaboration with the government, and is informed by consultations with civil society, private sector, academia, development partners, and the public. It recognizes the dynamic between rural and urban development where, in the short run, poverty reduction will come from rural areas. The focus in the medium term will shift towards urbanization and the creation of jobs for a rapidly growing labor force.
The investment portfolio in Uganda is primarily financed from the WBG’s International Development Association (IDA), which provides interest free “credits” and grants on concessional terms, attracting only an administrative service charge of 0.75% on the disbursed credit amount. Loan repayments are stretched over 38 years, including a six-year grace period.
As of March 2017, the Bank’s portfolio stood at $2.46 billion (credits and grants) in net commitment for national and regional operations. Around two thirds is supporting sustainable development, including 46% to infrastructure development (energy, roads, urban, and ICT), followed by agriculture (14%), and water (7%). Close to 30% is supporting human development (health 11%, education 9%, and social protection 7%); and the private sector and trade (5%). As of February 2017, disbursement stood at 10% with an undisbursed balance of $1.7 billion. On 22 August 2016, the Bank decided to withhold new lending to Uganda while working closely with the government to address performance, including delays in project effectiveness, weaknesses in safeguards-monitoring and enforcement, and low disbursement. All projects approved by the Board before August 2016 are not affected by this decision.
By receiving feedback from citizens, and by working closely with the government, stakeholders, and partners, the WBG is in a strong position to contribute toward shared prosperity and reducing extreme poverty in Uganda. Questions are welcome and can be forwarded to firstname.lastname@example.org.
Last Updated: Apr 20, 2017