Uganda's Shs72.136 Trillion Budget for FY 2025/2026 Focuses on Full Economic Monetisation
Kampala, Uganda - The Minister of Finance, Planning and Economic
Development, Hon. Matia Kasaija, today, June 12, 2025, presented a UGX 72.136
trillion national budget for the fiscal year 2025/2026. The budget, themed
"Full Monetisation of Uganda's Economy through Commercial Agriculture,
Industrialisation, Expanding and Broadening Services, Digital Transformation
and Market Access," prioritizes empowering households to participate
in the money economy and enhancing the country's productive capacity.
A significant portion of the budget
is allocated to key sectors aimed at driving this economic transformation, with
substantial investments in social services, agriculture, and tourism.
Key
National Priorities:
The overarching goal of the
2025/2026 budget is to accelerate the growth of the economy by focusing on:
- Human Capital Development: Improving the health and education of Ugandans to
create a more productive workforce.
- Wealth Creation:
Continuing and enhancing programs like the Parish Development Model (PDM)
and Emyooga to increase household incomes.
- Infrastructure Development: Investing in transport and energy to facilitate
commerce and reduce the cost of doing business.
- Agro-Industrialisation: Transforming the agricultural sector from subsistence
to commercial, with a focus on value addition.
- Digital Transformation: Leveraging technology to improve service delivery, efficiency, and financial inclusion.
Social
Services Investment:
The social services sector has
received a significant boost to improve the well-being of Ugandans. The health
sector has been allocated UGX 5.87 trillion. This funding will be directed
towards the functionalization of Health Centre IVs, scaling up e-health systems
for better data management and service delivery, and expanding emergency
medical services across the country.
The education sector has received
an allocation of UGX 5.04 trillion. This will support Universal Primary and
Secondary Education, provide student loans for higher education, facilitate the
construction of new seed secondary schools, and enhance teacher recruitment and
digital school inspection systems to ensure quality.
Agriculture
Value Addition:
In line with the budget's core
theme, UGX 1.86 trillion has been earmarked for agro-industrialisation.
The government's strategy is to move beyond subsistence farming by promoting
commercial agriculture and adding value to agricultural products before export.
Key interventions include:
- Increased funding for agricultural research to develop
high-yielding and disease-resistant crop varieties and animal breeds.
- Expansion of irrigation schemes to mitigate the effects
of climate change and ensure year-round production.
- Support for the Agricultural Credit Facility (ACF)
to provide low-cost financing for farmers and agribusinesses.
Tourism
Sector on the Rebound:
The tourism sector, a major foreign
exchange earner, has been allocated UGX 430 billion. The government aims
to position Uganda as a competitive destination for Meetings, Incentives,
Conferences, and Exhibitions (MICE). This will involve marketing Uganda's
unique attractions and investing in the necessary infrastructure to host
international events.
Boosting
Manufacturing and Local Content:
The budget includes several measures
to support the manufacturing sector and promote local content. Key among these
are tax reforms aimed at creating a more favorable business environment. These
include a three-year tax holiday for new citizen-owned businesses and
adjustments to excise duties to encourage the use of local raw materials. The
government is also committed to championing the Buy Uganda, Build Uganda
(BUBU) policy to provide a ready market for locally manufactured goods.
Science
and Innovation:
"Digital Transformation"
is a central pillar of the new budget. This focus on science and innovation is
evident in the planned scale-up of e-health systems and the digitalization
of school inspections. Furthermore, the budget highlights the achievements
of the National Agricultural Research Organisation (NARO) in developing an
anti-tick vaccine, underscoring the government's commitment to leveraging
science for economic development.
Savings
Campaign via Mobile Money and Investment in Government Securities:
While the budget speech emphasizes
"full monetisation" and wealth creation, which inherently encourages
a savings culture, there was no specific, high-profile announcement of a new
"Savings Campaign via MobileMoney and investment in Government
Securities." However, the broader theme of digital transformation and
financial inclusion suggests that the government will continue to support the
growth of digital financial services. The increased use of platforms like
Mobile Money is seen as a key enabler for bringing more Ugandans into the
formal financial system, which could, in turn, facilitate easier access to
savings and investment products, including government securities for retail
investors. The government's focus on digital solutions for programs like the
Parish Development Model (PDM) also points to a strategy of leveraging mobile
technology for financial transactions and, potentially, for encouraging savings
among beneficiaries. Financial sector stakeholders will be watching for
specific policy directives and initiatives from the Bank of Uganda and the
Ministry of Finance to operationalize this aspect of the digital transformation
agenda.
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