The ministry of Finance, Planning and Economic Development says Uganda’s economy is continuing to exhibit resilience and sustained growth in spite of the global uncertainties such as trade wars and international conflicts.
The ministry said Uganda’s economic growth averaged 6.9 per cent in the first three quarters of the just-concluded financial year. In a press statement, the ministry explained that “This robust growth in GDP was on account of government expenditure in the Parish Development Model, growth in fixed capital formation, and recovery in household expenditure.”
The statement added: “There was also growth in investments and exports. The good performance of the economy is expected to continue in FY 2025/26. Real GDP growth is projected at 7 per cent this FY 2025/26 and is expected to reach double digits in the medium term.”
This development comes as the approved national budget for financial year 2025/26 amounted to Shs 72.36 trillion, with the budget designed to support the implementation of the tenfold growth strategy with emphasis put towards agro industrialization, tourism development, minerals development and science, technology, and innovation (ATMS).
Notably, the press release highlights that in nominal terms, the size of the economy increased to Shs. 226.34 trillion ($61.3 billion) in FY 2024/25, from Shs 203.71 trillion ($53.9 billion) registered in FY 2023/24.
Additionally, in the fourth quarter of FY 2024/25, the Purchasing Managers’ Index (PMI), which indicates business operating conditions, stood at 55.6 with the Composite Index of Economic Activity (CIEA), which monitors economic trends, standing at 178.58, while the Business Tendency Index, which provides insights into overall business climate was recorded at 59.17 in June 2025.
“Annual headline inflation remained subdued and within the policy target of 5 per cent. Inflation was recorded at 3.9 per cent in June 2025, a slight increase from the 3.8 per cent recorded in May 2025. The Uganda shilling has continued to strengthen against the US dollar,” according to the press statement.
It added: “During the month of June 2025, the shilling appreciated by 1.3 per cent against the US dollar. This was largely on account of improved export performance, increased remittances and offshore investments, as well as prudent macroeconomic management. The shilling has remained one of the best performing currencies in Africa.”
The ministry further noted that Uganda’s total export earnings in the third quarter of FY 2024/25 amounted to $2.6 billion, which translated to a growth of 39.1 per cent compared to export earnings of $1.9 billion recorded for the third quarter of FY 2023/24.
The ministry further added that the rise in export earnings was as a result of improved volumes and international prices of some export commodities such as coffee and cocoa which more than doubled between the two quarters, with total exports of goods and services for the 12 months to March 2025 amounting $11.8 billion from $9.56 billion over the same period in 2024.
Uganda also continues to be a favourable destination for foreign direct investment (FDI) in various sectors of the economy. In the third quarter of FY 2024/25, FDI amounted to $785.79 million, a 26.3 per cent increase from the $622.06 million registered in the same period of the previous year.
Total foreign direct investments were worth $3.48 billion in the 12 months to March 2025, compared to $2.99 billion during the same period in 2024.
