Uganda’s Public Debt Grows Amid Rising Domestic Borrowing

Uganda’s public debt increased to US$34.86 billion (about UGX130.9 trillion) by the end of December 2025. This is according to the Ministry of Finance’s Quarterly Debt Statistical Bulletin and Public Debt Portfolio Analysis.

The report shows that the country’s debt rose from US$34.21 billion (about UGX128.6 trillion) recorded in September 2025.

Officials said the increase was mainly due to additional borrowing from the domestic market.

Domestic Debt Accounts for the Largest Share

Domestic borrowing continues to make up the largest share of Uganda’s public debt.

According to the ministry:

• Domestic debt: 54.5% of total debt
• Value: US$19.02 billion (UGX68.86 trillion)

External debt accounts for 45.3%, valued at US$15.84 billion (UGX57.33 trillion).

The ministry said the quarterly increase came mainly from increased domestic debt issuances.

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Domestic Debt Servicing Costs Drop

Despite the increase in borrowing, government spending on domestic debt repayment fell during the quarter.

Domestic debt servicing dropped by UGX916 billion.

• September 2025: UGX3.913 trillion
• December 2025: UGX2.997 trillion

This indicates a reduction in the cost of servicing domestic obligations during the period.

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Undisbursed Loans Increase

The report also highlights a rise in undisbursed loans. These are funds that have been approved but not yet fully utilized.

The amount increased from USD3.36 billion (UGX12.6 trillion) in September
to USD3.74 billion (UGX14.03 trillion) by December.

Officials said the increase resulted from new loans secured during the quarter.

Major funding came from international lenders including:

• African Development Fund
• BADEA
• IFAD
• OPEC Fund

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Multilateral Lenders Hold Majority of External Debt

Multilateral institutions hold the largest share of Uganda’s external debt.

They account for 65.13% of the total, valued at about US$10.32 billion.

Major lenders include:

• International Development Association
• International Monetary Fund
• African Development Fund

Among bilateral lenders, the largest creditors are:

• Export-Import Bank of China
• UK Export Finance

For private lenders, Stanbic Bank holds the largest share of Uganda’s debt.

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US Dollar Dominates Uganda’s External Debt

Most of Uganda’s external debt is denominated in US dollars.

Currency distribution includes:

• US Dollar: 46%
• Euro: 35%
• Chinese Yuan: smaller portion
• Japanese Yen: smaller portion

Currency composition is important because exchange rate movements affect repayment costs.

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External Debt Servicing Slightly Increases

Government spending on external debt repayment increased slightly during the quarter.

Uganda paid:

• US$416.62 million (UGX1.563 trillion) in December
• Up from US$381.52 million in the previous quarter.

The increase was mainly due to higher principal repayments and fees.