The Finance Ministry on Thursday tabled before parliament a proposal to borrow up to Uganda shilling 1.7 trillion to mitigate the effect of the coronavirus pandemic.
As of Thursday, Uganda coronavirus cases still stand at 44 – according to Ministry of Health.
The COVID-19 pandemic is affecting global economies – Uganda is one – and its effects will go to 2021, according to International Monitory Fund [IMF] managing director, Kristalina Georgieva.
On Thursday, three loan requests were tabled before Parliament by the Minister of State for Planning, David Bahati, during the plenary sitting.
The USD100 million is to be borrowed from the International Development Agency (IDA) to finance the health sector, in order to help them mitigate the effects of COVID-19.
Government is also seeking USD250M for the balance of payment for Bank of Uganda and USD99.8M to finance the competitiveness and Enterprise Development projects.
The Speaker of Parliament, Rebecca Kadaga, sent the loan requests to the Parliamentary Committee on the National Economy for scrutiny before a final decision can be taken.
World Bank’s projection
Georgieva issued the new outlook after a conference call of finance ministers and central bankers from the Group of 20 of the world’s largest economies who, she said, agreed on the need for solidarity across the globe.
“The human costs of the coronavirus pandemic are already immeasurable and all countries need to work together to protect people and limit the economic damage,” Georgieva said.
She said the outlook for global growth was negative and the IMF now expected “a recession at least as bad as during the global financial crisis or worse and the recoveries are expected in 2021.”
At the beginning of this month, she had warned that 2020 world growth would be below the 2.9 percent rate seen in 2019 but stopped short of predicting a recession. Trade wars pushed global growth last year to the lowest rate since a 0.7 percent contraction in 2009.
“The economic impact is and will be severe, but the faster the virus stops, the quicker and stronger the recovery will be,” she added.
Georgieva said the IMF would massively step up emergency finance, noting that 80 countries have already requested help and that the IMF stood ready to deploy all of its $1 trillion in lending capacity.