Uganda’s economy is expected to grow by 10.4 percent in the 2026/2027 financial year, up from an estimated 6.6 percent in 2025/2026, driven largely by the start of oil production, the finance ministry said on Wednesday.
In its five-year National Budget Framework Paper, the Ministry of Finance, Planning and Economic Development said economic expansion would accelerate as major investments come on stream.
Gross domestic product is projected to rise to 290.32 trillion Ugandan shillings (US$70.55 billion) in the 2026/2027 financial year, from 251.45 trillion shillings in 2025/2026, according to the document.
The budget framework is themed “Full Monetization of Uganda’s Economy through Commercial Agriculture, Industrialization, Expanding and Broadening Social Services, Digital Transformation and Market Access”.
The ministry said policy priorities in the 2026/2027 financial year and over the medium term will focus on continued investment in key growth sectors and enablers under the government’s so-called 10-fold growth strategy.
The strategy aims to expand Uganda’s economy from around 50 billion dollars to 500 billion dollars by 2040, anchored on agro-industrialisation, tourism, mineral development, and science and technology innovation.
Uganda is one of East Africa’s faster-growing economies, underpinned by a young population, expanding services sector and heavy public investment in infrastructure, but it also faces persistent fiscal and external pressures.
Economic growth has rebounded in recent years following the COVID-19 slowdown, supported by recovery in trade, tourism and construction. Agriculture remains the backbone of the economy, employing the majority of Ugandans, while services account for the largest share of output.
Inflation has eased from peaks seen in 2022 and 2023, helped by tighter monetary policy from the Bank of Uganda and lower global commodity prices. The central bank has gradually shifted towards a more accommodative stance as price pressures moderate, while seeking to protect the shilling from volatility.
Uganda’s public finances remain under strain, with high debt servicing costs limiting fiscal space. The government has relied on a mix of domestic borrowing, concessional loans and budget support from development partners, including the World Bank, to fund infrastructure and social spending.
A key turning point for the economy is the long-delayed start of commercial oil production. Uganda holds commercially viable crude reserves in the Albertine Graben and is developing the sector alongside Tanzania through the East African Crude Oil Pipeline (EACOP). Authorities see oil revenues as a catalyst for faster growth, foreign exchange inflows and industrial development, though critics warn of environmental risks and governance challenges.
