BoU Governor Warns Uganda Risks Depleting Reserves Through Currency Interventions

Appearing before Parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) on November 10, Dr Atingi-Ego said Uganda requires approximately US$2 billion annually to service government debt obligations and finance imports. He noted that while the central bank can intervene in the foreign exchange market to stabilise the Shilling in the short term, doing so repeatedly would deplete the country’s reserves.

“You are going to burn your reserves,” Dr Atingi-Ego warned, emphasizing that foreign exchange reserves are a critical buffer for the economy and must be preserved to meet external obligations and cushion the country against economic shocks.

The governor explained that central bank interventions can only provide temporary relief from exchange rate pressures. Sustainable stability of the Uganda Shilling, he said, depends on the country increasing its foreign exchange earnings through exports, investment inflows, tourism, remittances, and other productive sectors.