Uganda’s public debt will be close to the Shs30 trillion mark by the end of June 2016 which accounts for 34% of Gross Domestic Product [GDP], Finance minister Matia Kasaija has said.
Finance projected a Shs25,460 billion public debt in the last financial year but by December 2015, it had reached Shs 26,768.4 billion.
The total approved budget for the FY 2016/17 is Shs. 26,361 billion.
Out of this, Shs. 18,407.7 billion is allocated for spending by Ministries, Departments, Agencies and Local Governments.
Shs. 4,977.7 billion is domestic debt refinancing for maturing domestic debt; Shs. 169.18 billion for external debt repayments; Shs. 2,022.9 billion for interest payments; Shs. 111 billion for settlement of domestic arrears; and Shs. 672 billion is Appropriation-in-Aid (AIA), which is the amount of funds generated by MDAs and authorized to be spent by the same institutions.
About 70% of the Shs26.3 trillion Financial Year (FY) 2016/17 budget will be funded locally, compared to the 85% for the FY2015/16.
About 30% of the FY2016/17 UGX26.3 trillion budget will be sourced from donors and borrowing.
Uganda Revenue Authority has a task of collecting UGX12.9 trillion in taxes for the FY2016/17.
In Financial Year 2015/16, it was projected that the budget would be partly financed by issuing Government securities worth Shs. 1,384 billion.
In the Financial Year 2016/17, Government domestic borrowing will be significantly reduced and will amount to Shs. 612 billion.
The total external financing of the budget will amount to Shs. 6,524.5 billion in loans and grants, equivalent to 24.8 per cent of the total budget.
This will comprise of Shs. 2,520.8 billion in concessional loans, Shs. 2,513.7 billion in non-concessional loans and Shs. 1,490 billion in grants.
Kasaija, however, announced that domestic revenues are projected to increase to Shs. 12,914.3 billion up from this fiscal year’s projected outturn of Shs. 11,598 billion.
This will be achieved by improving efficiency in tax administration including enforcement of collections; increasing the tax base by reducing the size of the informal sector; and increasing investment in tax collection infrastructure.