President Museveni yesterday used the 63rd Independence Day fete to outline eight key priority sectors where the oil money will be invested to achieve growth.
Mr Museveni said the money from Uganda’s oil, which is expected to start flowing between mid-next year and early 2027, would be invested in defence, roads and railways, education, and health sectors.
He added that the money would first be injected into electricity generation, transmission and supply to support more factories, industries, and businesses, and finance provision of clean and safe water for the masses.
Mr Museveni further revealed that the oil cash would be sunk into wealth creation schemes such as the Parish Development Model (PDM) for the vulnerable poor, Uganda Development Bank for the rich to borrow, and in the promotion of science and technology.
‘After the flow of oil, the economy will grow by double digits. This economy was $3.9b (about Shs13.4 trillion) in 1986. Since that time, the following has gone through five phases of three Ts and Cs, and ending the shortage of essential commodities; phase two, expansion of the economy.”
The 3Ts refer to Uganda’s sources of foreign exchange earnings from tea, tobacco, and tourism, while the three Cs refer to copper, cotton, and coffee.
‘Phase three [is] diversification by taking on board new items, value addiction, and the knowledge economy of science, technology,’ he said.
Mr Museveni added: ‘.I am happy to report to Ugandans that by June 2026, the economy of Uganda will be $66.9b (Shs229 trillion) in size using the Forex method and $197.9b (Shs680 trillion) using the Purchasing Power Parity method.’
His remarks came barely a day after Mr Nathan Nandala Mafabi, one of his competitors in the ongoing presidential race, said Uganda’s oil resource is bound to become a curse if not well handled.
Mr Mafabi, who is running on the ticket of the Forum for Democratic Change (FDC) party, said, ‘Oil should not be a curse, it’s God-given and should benefit the people of Uganda. All resources we get must be applied to productive sectors to avoid leakage and extravagance.’
But Mr Museveni remained upbeat yesterday, chest-thumping and telling the mammoth crowd how God loves his ruling National Resistance Movement (NRM) party government, which explains why it’s during his reign that the multi-billion oil resource was discovered and by God’s grace its flow is going to be witnessed during his tenure.
Mr Museveni has had the longest rule in Uganda, stretching to 40 years by the time the polls would be held in January.
‘The British [colonialists] were here for 68 years from 1920 to 1956, but they tried looking for our oil, they didn’t see it, and now that we have it, we shall concentrate on key sectors including defence, roads, electricity, education, health, clean water, and wealth creation,’ he said.
Uganda’s oil, whose development has attracted both internal and external opposition, especially from environmental activists, is expected to, at peak production, bring in $2 billion (Shs6.8 trillion) annually in the next five years, and in the long term increase the country’s GDP by around $8.6 billion (Shs29.5 trillion).
This money, Mr Museveni believes, will be enough to change Uganda’s fortune since the investment would increase the key sector funding, which shall facilitate the creation of more jobs and undercut unemployment in Uganda.
He said the oil money would also ease the management of the swelling public debt, whose interest alone is Shs11 trillion.
Quarterly Debt Update report from the Ministry of Finance indicates that the public debt swelled to $32.3 billion (Shs111 trillion) by the end of June this year.
Of this, $16.8 billion (Shs57.7 trillion) was domestic debt, while $15.5 billion (Shs53.2 trillion) was external. In the current FY 2025/2026, some Shs37 trillion of Uganda’s Shs72 trillion budget has been allocated towards debt payment, with Shs11.3 percent eaten up by interests.
Mr Museveni used yesterday’s celebrations at the Kololo Ceremonial Grounds in Kampala to warn the government technocrats against scattering the resources, which he said retards development, since each sector is given small funding that cannot transform development.
‘The indiscipline in budgeting and revenue collection creates distraction and delays our development template . In 2006, I took a decision of prioritising infrastructure and energy sectors, which have since grown.,’ he said.
The President in August also emphasised the dangers of scattering the budget, saying he prioritised roads and electricity in 2005 when the country’s revenue started increasing. This, he added, led to the increment of the roads budget to Shs1.08 trillion and that of electricity to Shs1.3 trillion in 2008.
‘The budget for the two critical sectors increased to Shs4.62 trillion and Shs2.37 trillion in 2017, respectively. Actually, allocation for roads jumped to Shs6.4 trillion in the year 2019, and that of electricity was increased to Shs3 trillion in the same year. ‘The budget of the roads was Shs374.14 billion, and we raised it to Shs4.467 trillion per year. That of electricity was Shs133.47 billion, and we raised it to Shs2.393 trillion per year. I insisted that it should be like that thereafter,’ he said.
Mr Museveni also scoffed at a section of people he described as careerists who have always driven the government into biting more than it can chew when it comes to infrastructural development. He said the careerists who emerged after the 1996 elections started scattering the small budget across the various sectors, thereby subjecting the biggest percentage of the development budget to donors who later abandoned the projects, leading to the funding problems and stalling of the projects.
‘The big shame of depending on external support for all development projects was shown by three situations: the reconstruction of the Kampala-Masaka tarmac road that had reached its end of life; the reconstruction of the Kampala-Mityana road that had also reached its end of life; and the electricity line from Corner Kilak to Patongo-Kalongo-Abim,’ President Museveni.