IMF BOARD PRAISES UGANDAN CENTRAL BANK ON MONETARY POLICY STANCE

By Patrick Jaramogi

KAMPALA, Dec 15– The International Monetary Fund (IMF) has praised the Bank of Uganda on its monetary policy stance, saying it has brought down inflation innthe country to a four-year low.

This in turn has set the conditions for some additional monetary easing, provided the inflation expectations are anchored and the fiscal risks are contained, the IMF said in a media statement received here over the weekend.

The IMF added that Uganda’s performance under the Policy Support Instrument (PSI) remained satisfactory.
The IMF’s Executive Board has completed the third review of Uganda’s economic performance under the programme supported by the PSI, which was was approved by iti in June, last year.

It said the country’s real Gross Domestic Product (GDP) growth was lower than expected at the time of the second PSI review in 2013/14 and attributed this to under-execution of externally-financed public investment and the adverse impact on exports of slower growth in Uganda’s main trading partners.

However, the IMF added that the country’s growth was projected to expand in the financial year 2014/15, aided by scaled-up public investment and a recovery in private demand as accessing bank credit increases.

It pointed out, however, that a lack of tax compliance was resulting in lower-than-expected revenue. It also said revenues would be greatly improved if the Uganda Revenue Authority strictly enforced the recent elimination of the tax exemptions, coupled WITH enhanced compliance from taxpayers.

SOURCE: NEW VISION

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