Moody's Investors Service has affirmed the Government of Uganda's B2 long-term issuer ratings. The outlook remains stable.
The decision to affirm the ratings reflects the following key rating factors:
(1) Uganda's favourable medium-term economic prospects, despite a small economic size and low wealth levels pointing to limited shock absorption capacity;
(2) Limited institutional capacity posing challenges in managing rising debt associated with infrastructure investment; and
(3) Elevated susceptibility to event risk.
The stable outlook reflects credit risks being broadly balanced. Infrastructure investment and continued structural reforms in cooperation with the IMF will support the growth outlook, while medium-term fiscal and debt outcomes remain vulnerable to revenue underperformance, growth volatility and potential domestic and external shocks.
Uganda's long-term foreign currency bond and deposit ceilings remain unchanged at Ba3 and B3, respectively. The local currency bond and deposit ceilings remain unchanged at Ba2.