Uganda raises its military budget in response to the DR Congo conflict.
In the budget address given to Uganda’s Parliament on Tuesday, June 14, Finance Minister Matia Kasaija announced an allocation of Ush3.9 trillion ($1.02 billion) to security, adding that increasing the defense budget would be “the underpinning of socio-economic development in the next fiscal year.”
“Peace, security, and stability, as well as the rule of law,” Mr. Kasaija stated, “must remain essential government goals.”
Although there has not been a major conflict in Uganda, apart from pockets of instability created by livestock rustlers in the Karamoja area, Uganda has been investing significant funds in the sector each year.
Mr. Kasaija said this time that the funds were earmarked to boost activities in the eastern Democratic Republic of the Congo. He did not, however, say how much money was going into the effort.
“The UPDF (Uganda People’s Defence Force) will also continue with the pacification of the eastern Democratic Republic of the Congo in accordance with the agreement with the Government of the Democratic Republic of the Congo,” he stated.
“Maintaining peace, security, and stability, as well as macroeconomic stability,” Mr. Kasaija stated, “are critical foundations for economic recovery, development, and socioeconomic change.”
In November 2021, the Ugandan army commenced operations in eastern DR Congo against the Allied Democratic Forces rebels, who had been responsible for terrorist actions in Uganda and mass killings in DRC for over two decades. The UPDF has declared substantial combat gains in partnership with the Congolese army and sought augmentation of the force for an operation that, according to an army official, will persist as long as the danger exists.
The Finance Minister stated that the government intends to protect vulnerable Ugandans from the country’s skyrocketing commodity prices by encouraging farmers to grow more fast-maturing food and oil seeds for domestic supply, refraining from intervening in the market over prices, supporting alternative fuel supplies, particularly on Lake Victoria, to avoid supply disruptions, and using fiscal policies to mitigate the impact of rising commodity prices.
He announced the development of extra fuel storage facilities as well as the acceleration of the oil production process. Uganda has one petroleum reservoir at Jinja, 80 kilometers east of Kampala, with a capacity of 30 million liters for a country that uses around six million liters each day.
“The government cannot affect price levels whose movements are caused by exogenous shocks over which it has no control.” As a result, we will not implement policies that would cause long-term and costly economic distortions,” the minister said.
The economy is grappling with a public debt burden of more than Ush73.5 trillion ($19 billion), inflation of more than 6%, rising fuel and essential commodity prices such as food, cooking oil, soap, sugar, and bread, and a projected revenue shortfall of Ush939 billion ($250 million) in the fiscal year ending June 30, 2022. Mr. Kasaija, on the other hand, aims to turn the economy around.
Commercial agriculture, industrialization, expanding and broadening services, digital transformation and market access, implementation of the Parish Development Model, and promotion of agro-industrialization, according to him, will be the magic to transform the economy and ensure that each of the 44 million people earns at least Ush3.7 million ($1,000).
President Yoweri Museveni stated following the budget presentation that there was no reason to be concerned about economic trends, but that it would be concerning if the nation ran out of food.
“As long as Uganda produces food, there is no problem we cannot overcome,” he remarked, before adding that irrigation would tackle the problems of unpredictable rainfall and extended droughts.
He said that the issue of high gasoline costs would be addressed once the nation had an effective fuel transportation infrastructure, such as train and water transport, and that the country will soon manufacture its own fuel after the final investment decision agreement was inked months ago.