An IMF team led by Axel Schimmelpfennig visited Kampala May 15‒28, 2018 to continue discussions for a 3-year non-financial Policy Coordination Instrument. The mission met with President Museveni, Minister Kasaija, Governor Tumusiime-Mutebile, Permanent Secretary/Secretary to the Treasury Muhakanizi, members of parliament, private sector representatives, and senior government officials. The mission team thanks the authorities for the constructive dialogue.

The authorities have made progress in setting economic policy objectives for FY18/19 and the medium-term. Fiscal policy seeks to keep public debt at a sustainable level which requires raising tax collection and prioritizing spending needs, while protecting key infrastructure projects and social expenditures. Monetary policy targets core inflation of 5 percent. Bank of Uganda aims to maintain international reserves at 4 to 4½ months of imports. Structural reforms would focus on revenue mobilization, public financial and investment management, reducing domestic arrears, enhancing financial sector stability and development, and putting in place the remaining elements of the framework for managing future oil revenues.

The mission reached agreement on many key elements of a possible 3-year program under the Policy Coordination Instrument, but further progress in some areas is still needed. Once the FY18/19 budget has been approved as agreed, the mission could resume discussions.

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