The International Monetary Fund (IMF), one of the country’s major financiers, has called for reforms in oil governance as Uganda prepares to cash in on oil money.
According to the IMF senior resident representative, Ms Ana Lucia Coronel, oil revenue has the power to transform or ruin Uganda’s economy and government needs to commit itself to absolute transparency.
“Uganda will have a lot of taxes and revenues when it starts oil production and as a development partner, we are optimistic it will turn around the economy,” Ms Coronel, said.
“It important to have transparency and efficiency on how to manage oil revenues which we believe the Public Finance Bill addresses,” she added.
Ms Coronel, while speaking to journalists last week in Kampala, said the only way to ensure this transparency is for all the money to go to an established Petroleum Fund.
“This Fund ought to have a board with clear roles, to decide on how much is saved, how much is invested and how much is injected into the Budget,” she said.
“If Uganda does not have this system, then you will not know where the money is going,” she added.
According to Finance minister Maria Kiwanuka, government’s immediate priorities for oil revenues include agriculture and infrastructure development.
Debate on the Public Finance Bill is ongoing in Parliament on how government plans to utilise oil revenues but it has been received with mixed reactions by Members of Parliament, experts and the public.
According to government, the first phase of oil production will commence in 2018 with about 10,000 to 30,000 barrels per day (bpd) but will increase to 60,000 bpd.
Current oil volumes, according to the oil regulator, Petroleum Exploration and Production Department, surpass the 3.5 billion barrel mark announced in 2012 and could bring in close to $50 billion (about Shs130 trillion) in revenues. IMF expects oil revenues to boost Uganda’s Gross Domestic Product (GDP) by 25 per cent.