Finance Minister Henry Musasizi has defended the government’s economic management, warning against interventions that could offer temporary relief to the Uganda shilling at the expense of the country’s foreign-exchange reserves.
Musasizi said the government was closely monitoring economic developments and remained confident Uganda would overcome the current economic pressures without undermining the stability of the economy.
Addressing Parliament after presenting the State of the Economy statement, Musasizi cautioned against proposals such as subsidies and sustained reliance on foreign-exchange reserves to ease pressure on the shilling, arguing that such measures could leave the country vulnerable if the situation persisted.
“Do you want an economy with no reserves? The answer is definitely no,” he told MPs.
The minister challenged legislators to consider the long-term implications of drawing down reserves to support the currency, asking what would happen if the economic pressures continued for another year and the country’s reserves were depleted.
His remarks come as policymakers weigh options for managing currency pressures while safeguarding the country’s capacity to withstand external economic shocks.
Musasizi said Uganda had maintained sound economic fundamentals over the years, with the economy recording average annual growth of about 6% over the past decade.
He urged political leaders to explain the country’s economic position to the public and communicate the measures government was taking to maintain stability.
The minister also disclosed that government was using gold as one of the assets to support the country’s reserves under a policy approved by Cabinet and communicated to Parliament.
He said the government continued to assess economic performance daily, monitoring market movements and interest-rate changes to guide decisions on possible interventions.
Musasizi assured MPs that government would introduce additional measures if circumstances warranted them and would keep Parliament informed as the situation evolved.
“As I stated in the statement, if circumstances look that we make other interventions, we will definitely come back and inform the House,” he said.
Deputy Speaker Thomas Tayebwa called on Parliament and other leaders to support efforts to stabilise the economy, emphasising the importance of a coordinated response to the prevailing pressures.
Tayebwa said Musasizi could return to the House to explain further interventions if necessary, while the relevant parliamentary committee would continue engaging with the Ministry of Finance on economic developments.
Musasizi reiterated that government was committed to protecting economic stability while responding to changing conditions.
“We are working everything possible and we are confident we shall overcome this storm,” he said.
The minister’s remarks underscore the policy dilemma facing government: easing pressure on the shilling and supporting economic confidence without exhausting the foreign-exchange reserves needed to cushion Uganda against prolonged external shocks.
