Kampala, Uganda — October 6, 2025.
Bank of Uganda Governor Dr. Michael Nuwagaba has issued a cautionary statement about Uganda’s surging foreign capital inflows, warning that if not properly managed, they could destabilize the economy and weaken local exports.
Speaking at the Uganda Economic Outlook Forum held at Serena Hotel Kampala, Dr. Nuwagaba praised the country’s recent economic progress but noted that rapid capital inflows often put upward pressure on the Ugandan Shilling. This, he explained, can make exports more expensive and lead to an unsustainable trade environment.
“We must handle this wisely or lose our competitiveness. The goal is to keep Uganda’s economy attractive without suffocating our exporters,” said Dr. Nuwagaba.
Uganda’s economy recorded 6.2% growth in the 2024/2025 financial year, driven by agriculture, manufacturing, and services. However, economists at the forum emphasized that policy balance is crucial to maintain this momentum.
The Central Bank is now expected to tighten some monetary measures to absorb excess liquidity while encouraging domestic investments in productive sectors.
Meanwhile, the Ministry of Finance reaffirmed its commitment to coordinate policies that support long-term industrialization and job creation.
With Uganda’s economy showing resilience, experts agree that the country’s success will depend on how effectively it manages this new wave of global capital inflows.
