Government’s Commitment to Inclusive Growth & Economic Acceleration
Uganda has officially set the tone for accelerated national transformation in the Financial Year 2025/26 with the release of UGX 17.18 trillion in Quarter One (Q1), representing 23.7 percent of the approved UGX 72.38 trillion national budget. This deliberate and strategic financial disbursement reaffirms the Government’s commitment to achieving its Tenfold Growth Strategy, a bold framework aimed at propelling Uganda into a competitive middle-income economy.
Speaking during the official release, Ramathan Ggoobi, the Permanent Secretary and Secretary to the Treasury (PSST), emphasized that the Q1 disbursement prioritizes Agro-Industrialization, Tourism, Mineral Development, and Science, Technology and Innovation. These four pillars make up Uganda’s new economic growth model known as ATMS. The Government’s investment focus in these areas is further complemented by targeted allocations toward infrastructure, human capital development, and national security, which are critical enablers of sustainable and inclusive development.
A Resilient and Expanding Economy
Uganda’s economy continues to demonstrate resilience in the face of global uncertainties. In the previous financial year (FY 2024/25), the country achieved real GDP growth of 6.9 percent. Projections for FY 2025/26 place growth at 7 percent, with expectations of reaching double-digit growth in the medium term. In nominal terms, the size of Uganda’s economy expanded to UGX 226.34 trillion, equivalent to USD 61.3 billion, up from UGX 203.71 trillion or USD 53.9 billion the previous year.
This growth is supported by stable macroeconomic fundamentals. High-frequency indicators continue to reflect improved economic activity. The Purchasing Managers’ Index stood at 55.6, the Composite Index of Economic Activity at 178.58, and the Business Tendency Index at 59.17 as of June 2025. Inflation remains contained, recorded at 3.9 percent in June 2025, within the Bank of Uganda’s policy target of 5 percent. The Ugandan Shilling appreciated by 1.3 percent against the US Dollar in June, buoyed by increased exports, remittances, offshore investments, and prudent fiscal management, making it one of Africa’s best-performing currencies.
External Sector Strengthening Uganda’s Global Position
Uganda’s export earnings surged in the third quarter of FY 2024/25, reaching USD 2.6 billion, a 39.1 percent increase from the USD 1.9 billion recorded in the same quarter of the previous year. This strong performance was driven by increased international prices and volumes for commodities such as coffee and cocoa. While imports also rose to USD 3.05 billion, the country’s trade deficit narrowed significantly by 39.1 percent, improving from USD 757.48 million to USD 461.15 million.
Foreign Direct Investment inflows increased by 26.3 percent, rising from USD 622.06 million to USD 785.79 million in the third quarter. Diaspora remittances also registered notable growth, increasing by 31.4 percent to USD 304.48 million during the same period. Uganda’s balance of payments position improved, with international reserves rising to USD 4.3 billion, providing 3.8 months of import cover by June 2025.
Strategic Q1 Budget Allocations: Driving Growth with Purpose
From the UGX 72.38 trillion approved for FY 2025/26, UGX 17.18 trillion was released in the first quarter and allocated to high-impact sectors in alignment with the Tenfold Growth Strategy. Under Agro-Industrialization, the government allocated UGX 215.28 billion to research, operations, and development projects. Tourism Development received UGX 20.5 billion for sector branding, marketing, and enforcing hospitality standards. The Mineral Development and Petroleum segment was allocated UGX 26 billion, channelled through the Ministry of Energy and the Petroleum Authority of Uganda.
In the field of Science, Technology and Innovation, including ICT and the creative industry, UGX 139.13 billion was released. This includes UGX 83.3 billion to the Ministry of Science and Technology and UGX 33 billion to support artists under the Ministry of Gender, Labour and Social Development.
Infrastructure development continues to be a core priority. The Ministry of Works and Transport received UGX 1.076 trillion, largely to finance ongoing road and construction projects. The Ministry of Energy and Mineral Development received UGX 420.76 billion to support rural electrification, transmission line construction, and key power generation projects such as Karuma. Kampala Capital City Authority was allocated UGX 148.32 billion for various urban development projects.
In Human Capital Development, UGX 143.75 billion was disbursed to the Ministry of Education and Sports, with allocations targeting the Uganda Secondary Education Expansion Project, the Uganda Learning Acceleration Project, and non-wage activities. Public universities and higher institutions received UGX 157.73 billion, including UGX 16.49 billion for capital development. The Ministry of Health received UGX 262.88 billion to finance vaccine programs, health infrastructure, and outstanding obligations. The National Medical Stores was allocated UGX 173.96 billion for procurement of essential medicines. The Ministry of Gender, Labour and Social Development received UGX 118.23 billion, including subventions under the Social Assistance Grants for Empowerment. Regional referral hospitals and specialized institutions like the Uganda Cancer Institute and Uganda Heart Institute received a combined UGX 80.18 billion.
In the security and governance cluster, the Ministry of Defence received UGX 719.12 billion. The Uganda Police Force and Uganda Prisons Service received UGX 130.73 billion and UGX 87.15 billion respectively. State House, the Office of the President, the Internal Security Organisation, and the External Security Organisation were jointly allocated UGX 345.88 billion.
Revenue-generating entities were also prioritised. Uganda Revenue Authority was allocated UGX 114.9 billion to support tax collection efforts. The Uganda Registration Services Bureau received UGX 9.71 billion, while the National Citizenship and Immigration Control Department was allocated UGX 40.43 billion. Uganda National Bureau of Standards received UGX 26.44 billion.
Reinforcing Fiscal Discipline and Efficiency
The Ministry of Finance emphasised strict adherence to financial discipline. Accounting Officers across all Ministries, Departments, Agencies, and Local Governments were instructed to ensure that salaries, pensions, and payments to contractors are completed by the 28th of each month. No recruitment should take place without clearance from the Ministry of Public Service, and all financial commitments must be executed in Ugandan Shillings and aligned with the approved budget.
These measures are aimed at eliminating domestic arrears, avoiding penalties, and promoting technical efficiency. Accounting Officers are also required to convene Finance Committee Meetings to align spending priorities with the approved budget allocations for each quarter.
Transparency, Participation, and Accountability
In pursuit of transparency and citizen engagement, the Ministry has continued to promote public access to budget information through its official portal at www.budget.finance.go.ug and via the Budget Call Centre on 0800 229 229. These platforms are intended to foster accountability and informed participation by civil society, the media, and citizens.
A Nation in Motion
Uganda’s Q1 budget release marks more than the start of a fiscal year. It is a national development milestone that underscores the government’s resolve to implement its Tenfold Growth Strategy. By investing in productive sectors, enforcing fiscal discipline, and promoting efficient service delivery, Uganda is steadily building momentum towards middle-income status.
For development partners, international investors, and citizens, this budget release sends a clear signal. Uganda is serious about transformation, strategic in its priorities, and committed to building a prosperous and inclusive economy for all.
