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By Florence Kuteesa, Emmanuel Tumusiime-Mutebile, Alan Whitworth, Tim Williamson

Following the fifteen years rule of Idi Amin, struggle and civil struggle, the Ugandan economic climate used to be in ruins by the point peace was once restored in 1986. given that then Uganda has regularly been one of many quickest becoming economies in Africa, resulting in a considerable aid in poverty. Its fiscal luck has attracted huge realization and has arguably had extra effect on improvement pondering and at the foreign relief structure than the other nation. The HIPC debt aid initiative, the Paris assertion on relief Effectiveness, and the expansion of finances aid have all been strongly motivated via Ugandan event and considering. Ugandan recommendations corresponding to poverty aid ideas, public expenditure monitoring surveys, and digital poverty cash were greatly followed in other places. lots of the reforms which reworked the economic climate originated in the Uganda executive throughout the Nineteen Nineties, instead of being imposed via donor conditionality. during this ebook, for the 1st time some of the architects of these reforms provide their own money owed of the considering in the back of the reforms, how they have been applied, and their influence. considering that measures that paintings good in a single atmosphere may perhaps fail while transplanted to another atmosphere, the authors establish elements that have been serious to the luck of Uganda's reforms. whereas a few person reforms were the topic of educational examine, this publication represents the 1st consolidated account of the commercial reforms undertaken via the Uganda executive and their impression on development and poverty relief.

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Coffee smuggling was rife. Recognizing that this regime was a major deterrent to export production and an impediment to growth, the government embarked upon a unilateral liberalization programme in the early 1990s designed to reduce anti-export bias and encourage increased international trade. Non-tariff barriers were gradually removed following the introduction in 1991 of automatic licensing under an import certification scheme. The coffee export tax was abolished and replaced with import tariffs (Collier and Reinikka 2001: 32).

An obvious policy priority, therefore, was to increase tax revenue so as to reduce dependence on aid. The main problem was the collapse of systems for collecting tax, rather than tax rates. MoF was responsible for tax collection, through its inland revenue, income tax, and customs and excise departments. However, the erosion of public service salaries and morale meant there was little prospect of rapid improvement in tax collection under existing institutional arrangements. In 1991, therefore, responsibility for tax administration was transferred to a new, semi-autonomous organization: the Uganda Revenue Authority (URA).

However, no consistent direction on exchange rate policy was established until 1990. Two developments influenced the exchange rate debate. First, a high profile government seminar in 1989 brought together academics, politicians, and officials formally to discuss economic reform for the first time. The seminar was useful in sensitizing all participants about the key issues including the role of the parallel foreign exchange market in everyone’s lives. Second, the Presidential Economic Council (see Chapter 2) provided a forum for debate between the President, ministers holding economic portfolios, and senior officials.

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