Uganda is negotiating a new round of funding with the International Monetary Fund (IMF) in a bid to ease pressure on its ballooning public debt, a senior finance ministry official announced on Tuesday.
Ramathan Ggoobi, the Ministry of Finance’s Permanent Secretary and Secretary to the Treasury, said discussions are underway for a new Extended Credit Facility (ECF) program. He noted that the arrangement is expected to be presented to the IMF Board after Uganda’s general elections in early 2026. The country is scheduled to hold presidential and parliamentary polls in January or February next year, although the Electoral Commission has yet to confirm the exact date.
Uganda’s previous three-year ECF program, worth around $1 billion, was approved in 2021 but expired in September 2024. By the time of its lapse, only about $870 million had been disbursed. The IMF attributed the incomplete disbursement to “program implementation challenges compounded by external funding constraints.”
The East African nation is now eager to secure a fresh deal, as it struggles to balance financing needs with fiscal sustainability. Uganda’s public debt reached $29.1 billion at the end of 2024, marking a 17.8% increase from the previous year. Debt as a share of GDP climbed to 52.1%, up from 49.9% in 2023, according to finance ministry data.
The IMF’s Extended Credit Facility provides concessional loans to low-income countries facing balance of payment difficulties. For Uganda, such financing is considered critical to maintaining economic stability while also ensuring the government has affordable resources to fund development and service its debt obligations.
Securing another round of IMF support could also boost investor confidence, particularly in the lead-up to elections, when fiscal pressures typically rise. However, the government may face tough negotiations as the IMF often conditions lending on structural reforms and fiscal discipline areas where Uganda encountered difficulties under the previous program.
As Kampala prepares for a heated election season, the timing of the IMF talks highlights the delicate balance President Yoweri Museveni’s administration must strike between economic management and political considerations. Whether Uganda can secure favorable terms will depend on its ability to address past challenges and reassure the IMF of its commitment to reform.
