Yasiin Mugerwa
Barely two weeks after the 2009/10 budget painted a rosy picture on the standing of the economy, emerging details point to a struggling nation, as remittances from Ugandans working abroad, also known as Kyeyo, declined by 47 per cent within six months, Daily Monitor has learnt.
A new report by the Parliamentary National Economy Committee says within the first half of the 2008/09 financial year (July-December), the government lost $236.72 million (about Shs514.5b) in private remittances that would have otherwise gone into the economy.
Attributing the reduction to the global financial turmoil, the report also notes that an additional $258.64 million (about Shs562.2b) meant for NGOs and other insurance premiums was not remitted in the same period.
Before the slump, Ugandans abroad had remitted $504.04 million (about Shs1.09 trillion) while NGOs and other insurance premiums were getting $484.27 million (about 1.05 trillion). This situation is indicating to us how the global economic recession is beginning to affect our economy, the report says.
It adds: There is no doubt that these remittances have become a principal source of foreign exchange in the economy. Their decline has a direct negative effect in sustaining development in all sectors of the economy.
Although there are no available figures of Ugandans abroad who have lost jobs, information from Bank of Uganda shows that remittances mainly come from USA, the UK, Sweden, Japan, Switzerland and South Africa where more than half a million Ugandans are employed.
The reduction in remittances, according to experts, will mainly affect the construction, health and education sectors. MP Steven Birahwa said the government should invest more in agriculture to stave off a possible backlash of the slump.
Barely two weeks after the 2009/10 budget painted a rosy picture on the standing of the economy, emerging details point to a struggling nation, as remittances from Ugandans working abroad, also known as Kyeyo, declined by 47 per cent within six months, Daily Monitor has learnt.
A new report by the Parliamentary National Economy Committee says within the first half of the 2008/09 financial year (July-December), the government lost $236.72 million (about Shs514.5b) in private remittances that would have otherwise gone into the economy.
Attributing the reduction to the global financial turmoil, the report also notes that an additional $258.64 million (about Shs562.2b) meant for NGOs and other insurance premiums was not remitted in the same period.
Before the slump, Ugandans abroad had remitted $504.04 million (about Shs1.09 trillion) while NGOs and other insurance premiums were getting $484.27 million (about 1.05 trillion). This situation is indicating to us how the global economic recession is beginning to affect our economy, the report says.
It adds: There is no doubt that these remittances have become a principal source of foreign exchange in the economy. Their decline has a direct negative effect in sustaining development in all sectors of the economy.
Although there are no available figures of Ugandans abroad who have lost jobs, information from Bank of Uganda shows that remittances mainly come from USA, the UK, Sweden, Japan, Switzerland and South Africa where more than half a million Ugandans are employed.
The reduction in remittances, according to experts, will mainly affect the construction, health and education sectors. MP Steven Birahwa said the government should invest more in agriculture to stave off a possible backlash of the slump.
