Gov’t moves to borrow UGX2.4Trn from Stanbic Bank to finance budget deficit

Finance minister Matia Kasaija says will borrow 2.4Trn to finance budget deficits (PHOTO/File) KAMPALA – The Minister of Finance, Planning and Economic Development, Matia Kasaija is set to table a motion before Parliament during today’s plenary sitting seeking Parliamentary approval to borrow over Shs2.4Trn from both Stanbic Bank and Trade Development Bank to finance the 2019/2020 national budget deficit.

The details are contained on the order paper in which Government is set to borrow up to Euro 300 million from Stanbic Bank Uganda about Shs1.229Trn and Euro300 million from Trade Development Bank equivalent to Shs1.229Trn to finance the budget deficit for FY2019/20.

In the same plenary sitting, the Ministry of Finance is set to table a proposal to borrow up to Euro 162,445,694 approximately Shs665.819Bn from Industrial and Commercial Bank Of China to finance the development of industrial parks (power supply to industrial parks and power transmission line extension) [hon. minister of finance, planning and economic development.

The total proposed annual budget for FY 2019/20, as originally submitted to Parliament by the Minister of Finance, on 28 th March 2019, amounted to Shs39,548,172,607,000Trn of which Shs27,273,803,693,000 is due for appropriation and Shs12, 274, 668, 914, OOO (31% of the total) is for Statutory Expenditure charged directly on the Consolidated Fund.

However, on 9 th May, 2018 the Minister of Finance submitted Corrigenda to the Draft Estimates, and an addendum to the Corrigenda, which revised the total proposed annual budget for FY2019/2020 to Shs40,487,010,903,335 of which Shs27,957,163,419 is for appropriation and Shs12,530,739,916 is for statutory expenditure.

Government had projected that domestic and external financing will constitute 74.5% and 25.5% of the total resource envelope, respectively.

Uganda Revenue Authority is expected to collect Shs18,823.3Trn in 2019/2020 from Shs15,938.8Trn that was earmarked in 2018/2019 indicating 18.1% change with tax revenues set to contribute 47.6% of the national budget.

Non Tax Revenue from Ministries, Agencies and Departments (MDAs), would increase from Shs1,462.6Trn in 2019/2020 from Shs420.OBn projections made in 2018/2019 indicating 248% increment.

Government also set eyes on the Petroleum Fund and having obtained Shs200Bn in 2018/2019, there are plans to dig hands deeper into the oily money and use Shs445.8Bn to finance the budget indicating 122.9% increase.

Local Government Revenue will finance budget to a tune of Shs201.1Bn in 2019/2020 budget from Shs1,063.5Trn projected in 2018/2019 indicating a decline of 81.1% and Government plans to seek for loans from commercial banks thro domestic borrowing in 2019/2020 to a tune of Shs8,516.8Trn […]

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