Commercial banks gave out UGX1.8 trillion in form of loans and advances in 2020 following the Covid-19 induced lockdown, a report indicates. According to the 2020 Bank of Uganda (BOU) Annual Supervision report, gross loans and advances increased by 12.3 percent (UGX1.8 trillion) to UGX16.3 trillion, which was higher than 11.8 percent growth over the period ended December 2019. “This growth partly reflected a pickup in lending in the quarter ending December 31, 2020, and a significant component of capitalisation of interest on restructured loans, which, as a share of new net lending increased from 4.5 percent in the year…
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The Executive Board of the International Monetary Fund (IMF) on Wednesday, May 6th approved a disbursement of USD491.5 million (UGX1.87 trillion) under the Rapid Credit Facility (RCF) to help deal with the effects of Covid-19. According to an IMF media release, the money is to “finance the health, social protection and macroeconomic stabilization measures, meet the urgent balance-of-payments and fiscal needs arising from the COVID-19 outbreak and catalyze additional support from the international community.” “The Ugandan economy is being severely hit by the COVID-19 pandemic and, in particular, such key sectors as services (tourism), transport, construction, manufacturing, and agriculture. The challenging…
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By Onyango Owor It is no news that COVID-19 has rapidly spread across the world with the World Health Organization reporting more than 2 245 872 confirmed cases and 152 707 deaths globally, 19 April 2020, 03:00 GMT+3. In these unprecedented times, how you protect yourself and your business from the legal implication of a virus with no vaccine should be a priority. The total cost of the Pandemic on the global economy is currently estimated by the UN trade and development agency (UNCTAD) to be USD1 trillion and this figure is likely to rise. The devastating effect of the…
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Individuals and organisations have to date donated 31 motor vehicles and UGX4.6 billion to Government of Uganda’s efforts to fight Covid-19. This is in response to President Museveni’s call to the private sector to contribute to government’s efforts to fight the disease. President Museveni today in his 4th National Address held at Nakasero State Lodge, in Kampala said that so far government had realized 31 vehicles, UGX3.28 billion and USD343,000 (UGX1.3 billion). This does not include the other items in kind such as food, fuel, medical equipment and water. “I thank these contributors so much,” said Mr. Museveni. He said…
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Housing Finance Bank, one of Uganda’s top ten lenders and the biggest mortgage lender with over 50% market share, has started rolling out a credit restructuring exercise to its customers, on a case by case basis. The bank has asked customers who anticipate some challenges in servicing their credit obligations with the bank to reach out to the bank. In a public customer notice, Mr. Michael Mugabi, the bank’s Managing Director, said that, in the wake of the COVID-19 pandemic, Housing Finance Bank will stand with its customers by extending “our resources towards finding mutual solutions that will minimize the…
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WASHINGTON, April 9, 2020—Growth in Sub-Saharan Africa has been significantly impacted by the ongoing coronavirus outbreak and is forecast to fall sharply from 2.4% in 2019 to -2.1 to -5.1% in 2020, the first recession in the region over the past 25 years, according to the latest Africa’s Pulse, the World Bank’s twice-yearly economic update for the region. “The COVID-19 pandemic is testing the limits of societies and economies across the world, and African countries are likely to be hit particularly hard,” said Hafez Ghanem, World Bank Vice President for Africa. “We are rallying all possible resources to help countries…
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The Stanbic Purchase Managers Index (PMI) for March has recorded the first decline in business activity. This is due to the global coronavirus disease 2019 (COVID-19) pandemic which has led to falling new business, company shutdowns and issues with the supply of materials, thus pushing the Ugandan private sector into contraction. The headline PMI posted below the 50.0 no-change mark at 45.3 in March, following a reading of 56.2 in February. This marked the first deterioration in business conditions in the private sector since January 2017. Kenneth Kitungulu Stanbic Bank Uganda Head of Global Markets said, “COVID-19 caused issues in…
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“When you are faced by a prospect of famine, your first impulse should not be to go after the only planting seeds you have kept in your granary for the next planting season. That would be a strategically wrong move.” That is how Richard Byarugaba, the National Social Security Fund (NSSF) Managing Director, summarises the calls by some members of the public to be allowed to access part of their NSSF savings- to defend themselves against the potential negative impacts of Covid-19 on both the economy, especially their personal economy. Opposition stalwart, Dr. Kizza Besigye sparked off this debate about…
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By Dr. Sudhir Ruparelia We are entering into recession period globally and the exception is likely to be India and China with approximately 2% GDP growth in 2020 which is way below the 5% – 8% seen in the past several years. For the benefit of all, I am sharing my perspective on such a scenario on a few aspects as below: What will change during the slowdown? Spend on luxury will come down drastically; Long-term / Capital expenditure such as construction, technology will be almost cut to nil; Lifestyle expenditure such as salary, rent, infrastructure, entertainment will be minimised;…
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When that Coronavirus pandemic ends, we don’t know when, the world would have recorded many deaths of human beings and companies. Many companies would have simply closed, some would emerge bruised while others permanently changed. This is true of governments too. The Coronavirus has put countries and governments on a war footing. The measures to put in place cannot be like an exchange of niceties. They will be tough and may hurt too. Many countries have already announced shutdown and stimulus packages. Part of the packages are to ensure that life goes on during the pandemic while others would be…
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