Learn how the World Bank Group is helping countries with COVID-19 (coronavirus). Find Out

Overview

  • Economic Overview

    In October 2019, Uganda’s economic structure was significantly changed following a rebasing of the national accounts, resulting into a significant change in the structure of the economy. The revision of the base year from FY09/10 to FY16/17 and inclusion of activities that were previously missing, meant the economy was 21% larger during the last 10 years and by FY18/19, with a share of industry in gross domestic product (GDP) of 30%, much larger than the previous estimate of 20%. This increase was largely driven by manufacturing, for which the share doubled from about 8% to over 16% of GDP. The share of services declined from 58% to 46% of GDP, while agriculture rose from 22% to 24% of GDP.

    While about 700,000 young people reach working age every year in Uganda, only 75,000 jobs are created per year. This leaves more than 70% of Ugandans employed in agriculture, mainly on a subsistence basis. An average of one million young people are expected to reach working age between 2030-2040.  

    Finally, regional instability, pandemic preparedness (Ebola and Coronavirus) and broader global trade uncertainty could undermine exports and affect growth and have implications for debt sustainability and the current account.

    Development Challenges

    Uganda has achieved remarkable results in reducing poverty over the past decades, mainly driven by the agriculture sector. From 1992 to 2013, the percentage of Ugandan households living in poverty was halved, but vulnerability to external shocks remains high; for every three Ugandans who get out of poverty, two fall back in.

    All Uganda’s regions registered an increase in the number of poor persons with the notable exception of the Northern region, which is the poorest, and where poverty decreased from 44% to 33%.

    Human Capital in Uganda

    Uganda’s Human Capital Index (HCI) is low with a child born in Uganda today only expected to be 38% as productive when she grows up as she could be if she enjoyed complete education and full health. A child in Uganda completes seven years of education by age 18, compared to 8.1 for their regional counterparts. However, actual years of learning are only 4.5, with the 2.5 years considered ‘wasted’ due to poor quality of education. For instance, only 6% percent of children in Uganda can read a paragraph at the end of the fourth grade.

    Undernutrition is high and stunting affects one-third of all children in Uganda aged five years and below. At 3%, Uganda’s annual population growth rate is among the highest in the world, despite a reduction in fertility rates. Uganda’s population of 35 million is expected to reach 100 million by 2050, while the annual urban growth rate of 5.2% is among the highest in the world and is expected to grow from 6.4 million (2014) to 22 million by 2040.

    Uganda’s refugee population has almost tripled since July 2016 and is currently around 1.35 million, making it the largest refugee host in Africa, and third largest in the world. While its open-door refugee policy is one of the most progressive in the world, and refugees enjoy access to social services, land and can move and work freely, the continued influx is straining host communities and service delivery.

    Last Updated: Mar 05, 2020

  • World Bank Group (WBG) Engagement

    The World Bank Group Country Partnership Framework (CPF) 2016-2021 supports the government’s vision of a society transformed from a peasant economy to a modern and prosperous country by 2040. The CPF was 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 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 February 2020, the Bank’s portfolio stood at $2.9 billion (IDA credits and grants) in net commitment for 17 national and seven regional operations. More than 70% of the investment is supporting infrastructure development, including in health, and education.

    Last Updated: Mar 05, 2020

  • Energy for Rural Transformation III: The World Bank’s $355 million energy portfolio focuses on transmission and distribution. A 220KV transmission line from Kawanda-Masaka has been completed and will serve Masaka, Mbarara, Kasese, Fort Portal, Kabale and Bushenyi and surrounding areas. The line is expected to supply at least 50% of health centers not connected to national hydroelectricity or solar power. The 250 MW Bujagali Hydroelectric project remains a main source of power to the country and represents the first ever joint World Bank Group project, financed by an International Development Association (IDA) Partial Risk Guarantee for a syndicated commercial loan of $115 million; International Finance Corporation loans of $130 million, and a Multilateral Investment Guarantee Agency guarantee of $115 million.

    Uganda Support for Municipal Development Project (USMID): The 14 municipalities have been supported to develop modern infrastructure, including roads and street furniture; solid waste management; and the development of markets and urban transport facilities. Local government officials have also improved management and administration, including physical planning and urban development, own source revenue, and procurement and contract management.

    Regional Communications Infrastructure Program: The cost of internet bandwidth is down from $300 to $70 per Mbps, which has promoted use of electronic platforms and communications greatly improving efficiency of day-to-day government operations through shared infrastructure for data storage and service delivery. ICT skills have been enhanced through training programs to facilitate job creation and trade.

    Uganda Teacher and School Effectiveness Project: More than 17,000 primary education teachers have been trained in early grade reading and 12,198 schools have received 13 million math and English textbooks, improving the pupil-textbook ratio and improving learning outcomes. About 24% of pupils can read 20 or more words per minute compared to 1% in 2016. An e-inspection system is in place monitoring more than 1,000 schools. A draft Early Childhood Development Policy and supporting documents is in place while Early Childhood Education caregivers from 1,500 early childhood centers have been trained and are providing care to 82,620 pupils across the country.  A total of 929 classrooms have been constructed benefitting 55,200 pupils.

    Uganda Multi-Sectoral Food Security and Nutrition Project: Demonstration gardens have been established in 1,000 government-aided primary schools to promote production and consumption of micronutrient-rich foods and utilization of community-based nutrition services. In these gardens, high iron beans, orange fleshed sweet potatoes and a variety of indigenous vegetables are grown. Another 2,000 demonstration gardens for lead farmers in the communities surrounding the beneficiary schools were established.

    Health Systems Strengthening Project: As many as 230 health facilities countrywide have received medical equipment, and an e-recruitment job bureau at the Health Service Commission has been set up. Nine regional referral hospitals have been renovated across Uganda. Scholarships have been provided to 797 health workers, with most of the beneficiaries pursuing diplomas, and more than 400 already having completed their studies.

    Last Updated: Mar 05, 2020

  • The International Finance Corporation (IFC)

    As of February 2020, the IFC had commitments totaling to $174.6 million mainly in infrastructure, the financial market, agribusiness, education and energy. The IFC has worked closely with the Bank and Multilateral Investment Guarantee Agency on private power generation and distribution projects and continues to collaborate closely within the World Bank Group on renewable energy.

    Multilateral Investment Guarantee Agency (MIGA)

    MIGA’s portfolio has a combined gross exposure of $427.8 million, primarily focusing on guarantees covering investments in energy infrastructure, and banking. MIGA also supported Sithe Global (USA) with guarantees of $120 million covering its equity investment in Bujagali Energy Ltd.

    Last Updated: Mar 05, 2020

Api


LENDING

Uganda: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


PHOTO GALLERY

More Photos Arrow

In Depth

Coronavirus Sparks Recession

The latest economic analysis for the region predicts the pandemic could cost as much as $79 billion in output losses for 2020.

CPIA Africa

Africa’s poorest countries saw little to no progress on average in improving the quality of their policy and institutional frameworks in 2018.

IDA in Africa

With IDA’s help, hundreds of millions of people have escaped poverty—through the creation of jobs, access to clean water, schools, roads, nutrition, electricity, and more.

World Bank Africa Multimedia

Watch, listen and click through the latest videos, podcasts and slideshows highlighting the World Bank’s work in Sub-Saharan Africa.

Doing Business in Uganda

The Doing Business report provides objective measures of business regulations and their enforcement. See where your country ranks.