Uganda’s economy to grow by 6% in election year – Stanchart

Kampala, Uganda  | THE INDEPENDENT | Uganda’s economy has been given a clean bill of health with the economy expected to expand by at least 6% in 2020, according to Standard Chartered bank outlook.

This is despite the fact the country is going into an election year where some investors regard it very risky and will likely withhold their money until mid-2021.

Razia Khan, Chief Economist for Africa and Middle East for the bank, told reporters on Wednesday that there was likelihood that money charged on loans for businesses will remain high but government will push to be seen investing in infrastructure projects towards elections which will push the growth up.

The Stanchart prediction rhymes with predictions from other organizations like the World Bank and the International Monetary Fund that has shown Uganda will grow at above 6%.

On the likely challenges, Khan said the uncertainty relating to the final investment decision (FID) for the oil sector to take off will remain with investors unsure of what to do next.

This will lock out money from coming to the country. Also, she said, 2021 elections will be a big factor with some investors withholding their money until after the polls.

For the major East African economies – Kenya and Tanzania will also grow in the same range with Uganda. However, Stanchart says the impact of locusts will be immense if it spreads through the region.

This means locusts will cut on agriculture production and consequently growth.

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