Uganda will receive an emergency loan worth $491.5 million from the International Monetary Fund. The country needs the funds to help cushion its economy from the impact of the new coronavirus, according to a statement from the IMF.
Key sectors of the East African economy such as tourism have taken a big hit from the crisis and the effect has been further compounded by a lockdown of the entire population to curb the spread of the virus.
Uganda’s Ministry of Finance projects the country’s foreign exchange reserves will decline to the equivalent of 3.5 months’ worth of imports from 4.2 months’ worth as exports slump due to the global pandemic.
Countries receiving loans extended under the IMF’s Rapid Credit Facility pay no interest and have 10 years to pay it back.
Uganda’s central bank expects economic growth to fall to 3%-4% for the financial year to June from its previous projection of 5.5%-6%, as COVID-19 slashes activity in manufacturing, entertainment and trade.
The country has so far, recorded 98 coronavirus cases with no deaths. For about a month and a half from late March, Uganda implemented one of Africa’s strictest lockdowns. Authorities this week, began to gradually loosen it after Ugandan President ,Yoweri Museveni declared the virus ‘contained’.