The International Monetary Fund (IMF) under the Extended Credit Facility programme has extended $1b (about 3.547 trillion) to Uganda to enhance economic recovery subdued by Covid-19 disruptions.
According to Daily Monitor, IMF is extending support to Uganda to shore up sectors including health, social protection and macroeconomic stabilization that have been hit by Covid-19.
The publication also stated that on May 6, the IMF approved $491.5m for Uganda under the Rapid Credit Rapid to meet urgent balance-of-payments and fiscal needs arising from Covid-19-related disruptions as well as catalysing additional support from the international community?
IMF’s Amine Mati said that the credit extension was necessitated by the fact that Uganda’s economy had been hit hard by Covid-19,affecting people’s livelihoods, halving growth as well as driving an increase in poverty.
Mati said it was important that the IMF supports Uganda through the next phase of the Covid-19 response as well as strengthen fundamentals of the economy for more inclusive private sector-led growth.
“As the pandemic eases, we envisage a return to revenue-based fiscal consolidation while increasing priority social spending, including on Covid-19 vaccines and protect vulnerable households,” he said, noting that agreed upon improvements, along with improved pro-growth spending, will create space for private sector credit and boost human capital, setting the stage for a durable and inclusive growth.
According to Mati, as a condition for the credit facility the Uganda government, committed to fight corruption in Covid-19 dealings by publishing procurement contracts and providing information on the use of funds to mitigate the impact of Covid-19.
The emergency financial support from IMF and the World Bank has been key in closing financing gaps and supported mitigation measures.
