Gov’t concerned over China-US trade war, Brexit-Rugunda

Kampala, Uganda | THE INDEPENDENT | The government has said it was concerned that the happenings in the global north could potentially have a negative impact on the economy.

Speaking at the third Economic Growth Forum on Thursday at Imperial Royale Hotel in Kampala, the Prime Minister Ruhakana Rugunda singled out the trade war between China and USA and the impending United Kingdom’s exit from the European Union.

Rugunda said these might affect Uganda’s tourism receipts and diaspora remittances – worse if the global economy falls into recession.

Uganda gets donor money and loans to do infrastructure projects from these countries. A potential slowdown in any of these means less money would be dispersed to receiving countries.

With expected decline in the performance of UK’s economy, Rugunda fears it could affect Uganda’s tourism receipts. Also, that it could affect the job market in UK hence reducing diaspora remittances from Ugandans in the UK.

Pew Research Remittance flows report 2017 puts remittance from United Kingdom to Uganda at $372,000,000 (about 1.4 trillion shillings).

Uganda expects the economy to grow at between 6.3 to 6.5% in the 2019/20 financial year.

Uncertainties over what is happening in donor countries could impact this growth.

Bank of Uganda had raised similar concerns in its monetary policy report for August 2019.

Rugunda says, however, that government is working hard to tackle any risks that global events posse to Uganda’s development.

He also adds that Ugandans need to make concerted efforts to increase household income.

Richard Newfarmer, the International Growth Center Country Director Uganda, says Uganda needs to improve her domestic production through managing the changing weather and climate patterns.

He says that the rising global temperatures pose a risk to production especially in countries like Uganda where agriculture depends on weather.

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