Efficacy of COVID-19 Macro Economic Policy Responses in Uganda

The document analyzes Uganda's economic response to COVID-19, noting a growth slowdown to 2.9 percent in FY2019/20. While monetary and financial interventions stabilized the sector and lowered interest rates, and fiscal tax reliefs saved formal businesses, these measures increased public debt and external debt vulnerability. The Emyooga scheme targeted the informal sector and youth, though the author suggests addressing corruption and expanding age eligibility to improve inclusivity.

• The COVID-19 pandemic caused an unprecedented economic and health shock in Uganda, reducing economic growth to 2.9 percent in FY2019/20. This decline particularly impacted the industrial and service sectors, leading to job losses and reduced income, while low food inflation—driven by trade slowdowns and low aggregate demand—likely increased rural poverty.
• Government interventions in monetary and financial policy were successful in stabilizing the financial sector and boosting private investment. Expansionary monetary policy lowered market interest rates, and financial market interventions ensured that soundness indicators remained above regulatory requirements, maintaining investor confidence.
• Fiscal policy provided a temporary liquidity shield for formal businesses via tax relief, which protected jobs and future tax revenue. However, this resulted in higher public debt, leading to the crowding out of the private sector through domestic borrowing and increased external debt vulnerability, specifically regarding the PV of External Debt to Exports ratio.
• The UGX 165 billion Emyooga poverty eradication scheme was implemented to support the informal sector and youth. To improve the scheme, the government needs to reduce corruption-related leakages and expand eligibility beyond the 18 to 35 age bracket to ensure greater inclusivity and allocation to viable SACCOs.

APA

South African Institute of International Affairs (2021). Efficacy of COVID-19 Macro Economic Policy Responses in Uganda. https://saiia.org.za/research/efficacy-of-covid-19-macro-economic-policy-responses-in-uganda/

Chicago

South African Institute of International Affairs. Efficacy of COVID-19 Macro Economic Policy Responses in Uganda. 2021. https://saiia.org.za/research/efficacy-of-covid-19-macro-economic-policy-responses-in-uganda/.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=Efficacy of COVID-19 Macro Economic Policy Responses in Uganda |date=20 September 2021 |url=https://saiia.org.za/research/efficacy-of-covid-19-macro-economic-policy-responses-in-uganda/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2021efficacy, author = {{South African Institute of International Affairs}}, title = {{Efficacy of COVID-19 Macro Economic Policy Responses in Uganda}}, institution = {South African Institute of International Affairs}, year = {2021}, month = sep, url = {https://saiia.org.za/research/efficacy-of-covid-19-macro-economic-policy-responses-in-uganda/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }