Uganda on Thursday unveiled a proposed economic stimulus package that will provide liquidity for private firms affected by the COVID-19-induced national lockdown.
At a State of the Nation Address to the parliament, Ugandan President Yoweri Museveni said the measures introduced by the finance ministry are aimed at keeping the firms afloat amid the economic downturn caused by the COVID-19 pandemic.
In the package, corporations including small and medium-sized enterprises, will be allowed to delay payment of corporation tax or presumptive tax due between April and June 2020. For hard-hit sectors like tourism, manufacturing, and horticulture, payment can be deferred until September 2020.
Payment of Pay-As-You Earn tax by sectors which are most affected has also been deferred until September.
Museveni said that the finance ministry also proposed measures to entities that are unable to pay their loans because of the effects of the pandemic. Some of these measures include allowing extension of repayment periods, postponing loan repayment for a limited period, and relaxing the conditions for non-performing loans.
The ministry also proposed the reduction of reserve funds that commercial banks are required to keep with the central bank, and the creation of a special liquidity facility to rescue businesses that are not able to meet operational costs due to low demand or reduced production amid COVID-19.
According to a report by local publication Daily Monitor, the President said Uganda’s agriculture and ICT sectors will not be affected by the current COVID-19 pandemic ravaging both people’s lives and the real economy.
“ Apart from feeding us, these agricultural products end up by earning for us $2.005 billion (49 per cent of total merchandise exports) if we take the year 2019.” Adding: “Even in this lockdown, since March, the following agricultural products have earned for us as follows: coffee in March $45.87 billion, April $36.928million. Tea earning in March $5.15million, April$6.145million. Fish in March it earned $14.98million, April $6.831million. Maize earning in March$10.23million, April $6.256million.”
Finance Minister Matia Kasaija is scheduled to present the national budget before the parliament on June 11. Kasaija will also present before the parliament the stimulus package for approval.
