Uganda Aims for 10.4% Economic Growth in FY 2026/27: A Turning Point?

Government has projected a sharp acceleration in economic growth to 10.4 percent in the 2026/27 financial year, describing the period as a critical turning point toward upper middle-income status, despite a reduction in the overall national budget. State Minister for Finance (General Duties), Henry Musasizi, made the remarks while briefing Parliament's Budget Committee on the National Budget Framework Paper (NBFP) for Financial Year 2026/27. He said Uganda was at "its most promising economic inflection point," adding that "financial year 2026/27 is Uganda's opportunity to fast-track the qualitative leap to upper middle-income status." Flanked by the Permanent Secretary and Secretary to the Treasury, Ramathan Ggoobi, Musasizi told MPs that the economy grew by 6.3 percent in FY 2024/25 and is projected to expand by between 6.5 and 7.0 percent in the current FY 2025/26. Follow us on WhatsApp | LinkedIn for the latest headlines He said growth is expected to rise sharply in FY 2026/27. "The economy is projected to grow by 10.4 percent in FY 2026/27, increasing the size of the economy to Shs 290.2 trillion," he said. Musasizi said the 2026/27 budget will be anchored on the government's long-term growth strategy under the Fourth National Development Plan (NDP IV). "The budget for next financial year will be guided by the aspiration to expand the size of the economy tenfold before 2040, starting by doubling GDP every five years as programmed under the NDPIV. This policy direction will be implemented through sustained investments in the ATMS and enablers," he said. However, the minister acknowledged that several long-standing challenges remain unresolved and must be addressed in the next financial year. These include "stamping out budget games that breed corruption," closing leakages in routine expenditures such as transfers to schools, health centres and the payroll, improving liquidity management and sovereign credit ratings, and diversifying sources of development finance, including innovative financing. Musasizi revealed that the preliminary resource envelope for FY 2026/27 stands at Shs 69.399 trillion, down from Shs 72.376 trillion in the current FY 2025/26. Earlier, Musasizi, together with State Minister for Planning Amos Lugoloobi, presented the Budget Framework Papers for Vote 008 (Ministry of Finance, Planning and Economic Development) and Vote 130 (Treasury Operations) to the Finance Committee of Parliament. He said the Finance Ministry's budget allocation for FY 2026/27 is estimated at Shs 2,693.40 billion, down from Shs 2,796.77 billion, "mainly on account of the overall reduction in the total resource envelope." Musasizi also noted that Shs 28,264.652 billion allocated to Vote 130 (Treasury Operations) will be used to ensure "timely processing of debt service payments, redemptions and other statutory obligations," as government seeks to maintain fiscal stability amid tightening budget conditions.