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Uganda receives USD 491.5million loan from IMF to deal with coronavirus effects

Uganda receives USD 491.5million loan from IMF to deal with coronavirus effects

– Uganda had requested for USD 491.5 Million loan from IMF to help the government in responding to coronavirus effects – The IMF approved USD 491.5 Million noting the impact of COVID-19 on Uganda economy would be severe hence the need for the financial aid – The international lender advised the government to loosen its fiscal consolidation stance to allow space for coronavirus-related interventions on a temporary and targeted manner.

The International Monetary Fund (IMF) has approved a loan worth USD 492.5Million to help the Ugandan government address the challenges brought about by coronavirus pandemic. The multilateral lender noted the impact of COVID-19 on Ugandan economy would be severe and urged the government to loosen its fiscal consolidation stance to allow space for coronavirus–related interventions on a temporary and targeted manner.

In a statement released by IMF board on Wednesday, May 6, the loan would help the Ugandan government safeguard public health and support households and firms affected by the pandemic. “Emergency financing under the RCF will deliver liquidity support to help Uganda cover its balance of payments gap this year. It will provide much-needed resources for fiscal interventions to safeguard public health and support households and firms affected by the crisis,” said the IMF Deputy Managing Director Tao Zhang.

Uganda had requested for USD 491.5 Million loan from IMF to help the government in responding to the crisis.

The international lender noted the East African country was in dire need of the requested financial aid to address the pandemic challenges and salvage herself from the looming economic crisis. “The impact of COVID-19 on the Uganda economy will be severe. It will act through both global and domestic channels, and downside risks remain large. While the authorities have taken decisive action to respond to the pandemic’s health and economic impacts, the sudden shock has left Uganda with significant fiscal and external financing needs,” noted the IMF in a statement.

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