The Executive Board of the International Monetary Fund (IMF) today completed the second review of Uganda's performance under the third annual arrangement under the Poverty Reduction and Growth Facility (PRGF). This will enable Uganda to draw SDR 8.9 million (about US$11 million) immediately from the IMF.
News Brief No. 01/27
March 26, 2001 International Monetary Fund
700 19th Street, NW
Washington, D.C. 20431 USA
IMF Completes Uganda Review under PRGF and
Approves US$11 Million Loan
The Executive Board of the International Monetary Fund
(IMF) today completed the second review of Uganda's
performance under the third annual arrangement under
the Poverty Reduction and Growth Facility (PRGF). This
will enable Uganda to draw SDR 8.9 million (about
US$11 million) immediately from the IMF.
The three-year PRGF arrangement was approved on
November 10, 1997, in a total amount of SDR 100.4
million (about US$127 million). On the occasion of the
first review of the third annual arrangement on
September 6, 2000, an extension of the PRGF
arrangement to end-March 2001 was approved.
The Executive Board also reviewed today Uganda's
Poverty Reduction Strategy Paper Progress Report,
which outlines the country's recent progress in
implementing the Poverty Eradication Action Plan.
Following the Board discussion on Uganda, Shigemitsu
Sugisaki, Deputy Managing Director and Acting
"Uganda has achieved significant progress in
implementing a broad-based poverty reduction strategy,
linking budgetary outlays to explicit outcome targets,
and setting up mechanisms to monitor progress in
achieving the targets of the strategy. The authorities
are to be commended for their recently completed
Poverty Reduction Strategy Paper (PRSP) Progress
Report, which indicates that the incidence of poverty
has declined substantially. However, the rising
inequality and the increasing incidence of poverty in
Northern Uganda are a matter of concern. The
authorities are therefore encouraged to continue their
efforts to resolve the security problems, which
constrain economic activity and the delivery of social
services to the north. In view of the central role
that districts play in the implementation of the
poverty reduction program, it is also essential that
the authorities develop an efficient, effective, and
transparent public service delivery system at the
"Prudent macroeconomic management has helped to keep
the 2000/01 program on track and preserve budgetary
allocations for poverty reduction programs in the face
of a sharp deterioration in the terms of trade.
Budgetary management was helped by close monitoring of
expenditure in the context of the Commitment Control
System (CCS), and the authorities are encouraged to
strictly enforce all the provisions under the CCS,
including the penalties for noncompliance.
"Uganda is committed to improving revenue performance,
which is essential to the preservation of key
development expenditures and the long-run viability of
the poverty reduction strategy. Strengthening the
capacity of the Uganda Revenue Authority is a critical
step toward this objective.
"Significant progress has been made in addressing the
problems in the banking system and strengthening the
bank supervision capacity of the Bank of Uganda. To
build on this progress, an early enactment of the new
Financial Institutions Bill and strict enforcement of
banking regulations and the law are needed.
"Further progress has been made in trade
liberalization, including the recent removal of the
special protection accorded to the textile industry,
and the authorities are encouraged to complete the
trade reform agenda, by eliminating the discriminatory
excises on selected imports," Mr. Sugisaki said.
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