Uganda has risen to 3rd place in the 2025 Absa Africa Financial Markets Index, up from 4th in 2024, driven by strong regulatory reforms, high transparency, and a resilient economy.
The report highlights Uganda’s impressive 6.3% GDP growth in 2024/25, with projections of 6.5–7% in 2025/26, low inflation (3.6%), and a stable currency supported by robust export growth.
Key Findings from the 2025 Absa Africa Financial Markets Index:
- Top Ranking: Uganda secured 3rd position in Africa, achieving its highest-ever score (66 points), citing improved access to foreign exchange and strong legal standards.
- Economic Outlook: Growth is driven by services, industry, and agriculture, supported by a stable Central Bank Rate (CBR) of 9.75%.
- Market Growth: The report highlights a focus on increasing pension fund participation and developing the capital market to improve liquidity.
- Challenges: Despite the gains, the index notes the need to address low market liquidity and strengthen pension fund development (15/100 points in 2024).
- Performance Drivers: The Uganda shilling was noted as one of East Africa’s strongest currencies, supported by high export earnings.
The Bank for International Settlements report emphasizes that these reforms are part of a broader strategy for long-term financial stability and inclusion.
During the launch of the report, the Permanent Secretary and Secretary to the Treasury (PSST), Dr. Ramathan Ggoobi, said economies are adjusting globally to tighter financial conditions, geopolitical tensions, and shifting trade dynamics, adding that in this uncertainty lie opportunities, especially for African economies that have invested in stability, reform institutions, and deepened markets. He said Uganda is determined to be among those economies.
“Uganda is ranked among the fastest-growing economies not just in the region but the world and is expected to remain so in the medium term”, said Dr. Ggoobi.
Because of the prudent macroeconomic management and sustained structural reforms, particularly in financial markets and regulatory frameworks, the PSST said the key results include: expansion of nominal GDP to about USD 68.4 billion this June 2026, with income per capita projected to rise to over USD 1399.
Other results include: controlled inflation averaging 3.5%, stable shilling, increased export earnings, and growth in foreign direct investment, tourism receipts, and remittances.
Dr. Ggoobi highlighted the priorities to deepen the financial sector, and these include: Rebuilding capital markets that provide long-term debt and equity financing, attracting venture capital that supports higher-risk innovation with lower collateral requirements, and exploring the establishment of an SME-focused stock exchange to support firms that do not meet main-board listing criteria.
He also said the government is keen to capitalize the Uganda Development Bank to meet the demand for long-term, affordable financing.
“We are working on a mission to build a 500 billion-dollar economy by 2040, and our strategic bets are the ATMS and enablers,” said the PSST. ATMS stands for agro-industrialisation, tourism, mineral beneficiation, science, technology, and innovation sectors.
Ggoobi said financial inclusion will be central to this transformation, adding that PDM has demonstrated financial inclusion by digitally delivering over USD 1 billion to citizens considered unreachable by traditional models.
“My message is simple. Uganda’s economic fundamentals are strong, our policy direction is clear, and our opportunities are expanding. The work ahead is to deepen financial markets and sustain momentum through continued reforms and partnerships,” said Dr. Ggoobi.
He thanked Absa Group and partners for creating a platform that brings together policymakers, regulators, and market leaders to reflect on Africa’s financial progress and future direction.
The Governor of the Bank of Uganda, Michael Atingi-Ego, spoke about the bank’s market deepening agenda to bring capital, liquidity, and institutional participants into the financial system. He called upon the government to pass the pension reforms and also highlighted the role of regulators in mobilizing long-term savings.
He described the 9th edition of the Africa Financial Markets Index as an indispensable diagnostic tool for assessing Uganda’s progress. The Governor also acknowledged that monetary tightening in advanced economies and growing geopolitical fragmentation continue to create headwinds for emerging and frontier markets.
“Our biggest constraint today is not regulatory sophistication, it is capital mobilization and market depth,” said the Governor.
He noted that the recent gains in the financial markets have been supported by reforms across core market infrastructure, adding that achievements reflect collective effort across government, regulators, Parliament, and market participants.
Absa Managing Director David Wandera said Uganda’s financial markets are no longer just growing but stabilizing with confidence. He said he was proud of Uganda securing the third place in the 2025 Africa financial markets index, up from 4th in 2024 and from 10th when the index was launched in 2018.
“Market depth is built on trust, and trust is built through strong regulation,” said Wandera, adding that Uganda’s market progress is being driven by regulatory and policy reforms that strengthen transparency and investor protection.
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(Content sourced from the report and MoFPED).
