Uganda prospects good, needs fiscal reform: IMF

press ahead with fiscal reforms, the International Monetary Fund said.
Thomas Richardson, who is heading an IMF mission, said in a statement that Uganda would need to unwind its stimulus programme and rebuild its fiscal balances and international reserves.
Inflation has been rising and hit 11,1 percent year on year in March due to higher food prices, rising fuel costs, exchange rate depreciation, and high rates of private sector credit growth, Richardson said after meetings with government officials.
“Uganda has strong prospects for economic growth in the coming years, particularly if the authorities can successfully manage the macroeconomic challenges associated with Uganda’s planned acceleration in infrastructure spending,” he said.
The IMF said the East African nation, which is set to start pumping oil next year, needed to broaden its tax base by eliminating exemptions as its revenues, at about 12,5 percent of GDP, were low and insufficient for infrastructure investment.
The Washington-based body said in February that it was unhappy with some of Uganda’s economic policies but did not name them.
Richardson said Uganda’s oil revenues should be handled transparently and with the approval of parliament.
“Fiscal revenues related to oil exploration and external borrowing on commercial terms will be reserved for financing large infrastructure projects with high returns,” he said. – Reuters.