The Ministry of Finance has said the dollar-shilling exchange rate for the 2020/21 financial year will
be pegged at Shs3,900.
be pegged at Shs3,900.
The
rate, which could be a signal of government’s projected movements,
especially in the face of election inflationary pressures, will be a
guide as government plans for the 2020/21 financial year.
The
decision was reached during the second budget call circular on the
finalisation of detailed budget estimates and ministerial policy
statement for the 2020/21 financial year.
“For
planning and budgeting purposes, the exchange rate for 2020/21 financial
year will be $1 to Shs3,900,” the Finance Ministry said in the final
circular signed by Permanent Secretary and Secretary to the Treasury
Kieth Muhakanizi.
The circular also noted that the
resource envelope for the 2020/21 financial year will be Shs41.9
trillion, which will include debt redemptions and non-tax revenues.
Government,
according to the circular, will mobilise Shs33.167 trillion from
internal sources while Shs8.769b will come from external funding.
The new pegging comes at a time when the shilling has remained largely stable with very minimal movements against the dollar.
According
to Bank of Uganda, the shilling-dollar rate was relatively stable with a
bias towards appreciation due, in part, to the increased inflows during
the festive season.
In the quarter to January 2020, the shilling appreciated by 0.1 per cent to an average mid-rate of Shs3,680.8 per dollar.
In
January alone, according to Bank of Uganda, the unit appreciated by 0.6
per cent on the account of inflows from offshore investors,
non-governmental organisation and growth in export receipts amid subdued
demand.
Development partners still play a big role in
Uganda’s external budget support, which goes direct into the Treasury
and project support that is channeled into different projects.
Mismatch in calendar budget approvals
The
circular also noted that the Auditor General’s report had indicated
that local governments had in the 2018/19 financial year failed to
realise expected donor financing because of a mismatch in calendar
budget approvals.
“Therefore, all accounting officers are strongly advised to engage donors to harmonise the calendars for the 2020/21financial year,” the Ministry of Finance said.
“Therefore, all accounting officers are strongly advised to engage donors to harmonise the calendars for the 2020/21financial year,” the Ministry of Finance said.
moketch@ug.nationmedia.com
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