The African Development Bank (AfDB) has hailed Uganda for being one of the few countries in Africa that have managed its external debt which has not gone beyond the recommended threshold.
According to a State House statement issued on Sunday, Akinwumi Adesina, president of AfDB said this while meeting Ugandan President Yoweri Museveni on Friday. Uganda’s ministry of finance last month said over the next four financial years, it is going to concentrate on debt management and economic recovery.
The ratio of Uganda’s nominal debt to gross domestic product (GDP) in December 2020 stood at 47.2 percent, up from 38.0 percent from a year earlier.
Experts say if a country’s ratio is above 50 percent, then it faces debt distress. The president of AfDB said the bank has a proposal to help African countries reduce their foreign debt by availing them with much cheaper loans so as to pay off their foreign lenders and pay back those cheap loans to the bank in a phased way.
President Museveni welcomed the AfDB’s proposal, noting that Uganda was ready to work with the bank toward that direction.