On Thursday 13th June 2024, East African countries rallied to present their 2024/25 budget statements to their respective parliaments, each with views tailored for their countries.
- •Across the EAC nations, efforts towards debt sustainability lingered while grappling with growing sovereign debts amid global economic risks.
- •Kenya’s budget remains the giant followed by Uganda, Tanzania, Rwanda and Burundi at the TailEnd.
- •Below is a highlight of what stood out in our regional counterparts’ reports:
Uganda
In Uganda, Finance Minister Matia Kasaija presented the UGX 72.13 trillion ($19.2 billion) for the 2024/2025 fiscal year with an increase of UGX 19.39 trillion from UGX 52.74 trillion of 2023/24 financial year. The anchor sectors tackled were Agriculture, ICT and Manufacturing
Total expenditure in the FY2024/25 budget is projected at UGX 72.136 trillion. Recurrent expenditure will amount to UGX 18.9 trillion while development expenditure at UGX 34.7 trillion.
Uganda’s GDP is projected to grow by 6.4 per cent in the next financial year, expanding to UGX 225.5 trillion. This surpasses Sub-Saharan Africa’s average of 3.8 percent and the global average of 2.9 per cent.
The growth, Matia said, will be driven by increased oil and gas activities, export growth, tourism development, agro-industrialisation and science, technology and innovation.
Education, health and water, sanitation and hygiene have been allocated UGX 10.204 trillion in the next financial year.
Additional financing is projected from grants and loans amounting to UGX 1.3 trillion, domestic borrowing targeted at UGX 8.9 trillion. Further, the framework also includes UGX 9.5 trillion from project support and UGX 19.8 trillion earmarked for domestic debt refinancing.
Tanzania
Tanzania’s budget is expected to rise by 11.2% to TZs 49.35 trillion ($18.90 billion) in the next financial year starting July 2024, largely aimed at helping the government service its debts.
The 2024/25 budget seeks to stimulate a competitive and inclusive economy; strengthen production capacity in industries and service delivery; promote trade and investment; stimulate human development and develop human resources.
Tanzania’s economy is expected to grow 5.4 per cent in 2024, with the government keen on tax payment.
The Minister for Finance and Planning Hon. Mwigulu Lameck Nchemba said the plans for the next financial year will influence growth in sectors such as industry, agriculture, minerals, tourism, livestock farming and fishing, electricity, transportation and social sectors namely education and health.
“The budget has increased largely due to the need to service government debts that have been raised due to shilling depreciation, increase in interest rates and maturity of the previous debts,” he said during a presentation of the budget to parliament in the capital Dodoma.” Finance minister Mwigulu Nchemba said on Thursday.
The government projects total revenue collection, to be TZs 34.61 trillion, equivalent to 70.1 percent of GDP. Additionally, the government will raise TZs 5.13 trillion from grants and concessional loans.
Total expenditure in the FY2024/25 budget is projected at TZs 33.55 trillion. Of this, recurrent and development expenditures will amount to TZs 15.78 trillion.
Dr Nchemba said a bulk of the public cash in the next financial year will be injected towards strategic infrastructure projects, social services and preparations for 2024 local government elections and the 2025 general election.
Additionally, a fund was allocated for renovation of stadiums and construction of new ones as the nation prepares to co-host the 2027 Africa Cup of Nations (AFCON).
Rwanda
In Rwanda, the Government unveiled a proposal for a budget of Frw 5,690.1 billion ($4.3 billion) for the upcoming fiscal year 2024/2025, an increase of 11.2% from the previous budget.
“The 2024/25 budget proposal reflects Rwanda’s economic resilience in the face of external shocks. The Government remains committed to prioritizing spending, making strategic investments to achieve NST1 objectives, and maintaining economic stability” Minister Ndagijimana said, addressing law makers.
Total estimated resources for the fiscal year 2024/25 are projected at Frw 5,690.1 billion. This comprises domestic revenues of Frw 3,414.4 billion, with Frw 2,970.4 billion expected from tax revenues and Frw 444.0 billion from other revenues.
External grants are estimated at Frw 725.3 billion, while external loans are projected to amount to Frw 1,318.1 billion. Domestic borrowing and financial assets drawdown will total Frw 232.3 billion.
Total expenditure for the fiscal year 2024/25 is forecasted at Frw 5,690.1 billion. This includes recurrent expenditure of Frw 3,466.3 billion and development expenditure of Frw 1,992.3 billion. The Government also anticipates additional Frw 231.5 billion for equity, investment fund shares, and policy lending.
Burundi
Burundi’s budget will rise 15.9% to 4.4 trillion Burundi francs ($1.5 billion) in the 2024/25 financial year starting in July with the government unfreezing of civil servants’ salary bonuses, Finance Minister Audace Niyonzima said on Thursday.
“The priority allocations retained in this draft budget, which are at the origin of the budget increase, include particularly salaries and bonuses which have increased significantly,” Niyonzima said.
The economy is expected to grow 5.4%, up from 4.2% in 2023/24, boosted by government investment programmes and improved cooperation with the country’s development partners.
Salaries were frozen in 2015 by the government after donors slapped sanctions on the land locked country following political turmoil. The sanctions were later lifted in 2021.
The budget would also channel funds towards the construction of road infrastructure in rural and urban areas, he said.
The budget will be funded equally from internal and external revenues, leaving a forecast deficit of 441.9 billion francs next financial year, up from 426.5 billion francs in 2023/24.
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