The Finance minister Matia Kasaija has said that projection for economic growth in FY 2019/20 has been revised downwards from 6.0% to between 5.2% to 5.7% depending on the severity of Coronavirus impact on Uganda.
Kasaija had on Thursday afternoon appeared before parliament where he made a statement on the Economic impact of Coronavirus on the country.
He said low activity in industry and services sectors will result into loss of jobs, decline in economic growth and increase in the level of poverty.
“The number of people that could be pushed into poverty is estimated at approx. 780,000,” warned the minister.
“Coronavirus has already affected tourism, exports, imports, remittances and foreign direct investments,” he added.
The minister said that loan disbursements are projected to decline by 50% in these last months of this financial year.
Kasaija added that revenue collections will register a shortfall of about Shs82.4 billion for the remaining period of FY 2019/20 and about Shs.187.6 billion in FY 2020/21.
“Preliminary estimates from the ministry of health indicate a financing requirement of Shs25 billion to deal with health challenges caused by coronavirus,” said Kasaija.
He said Government is faced with a preliminary additional financing gap of approx. Shs370 billion in FY 2019/20 and Shs.350 billion in 2020/21 due to revenue shortfalls.
“To deal with the financing gap, the Ministry of Finance will seek budget support loan on concessional terms worth US$ 100 million for FY 2019/20 and US$ 90 million for FY 2020/21,” he said.