Financing Uganda'S Poverty Reduction Strategy: Is Aid Causing More Pain Than Gain?

September 1, 2004

Preview Citation

Format: Chicago

Mwanza Nkusu. Financing Uganda'S Poverty Reduction Strategy: Is Aid Causing More Pain Than Gain?, (USA: International Monetary Fund, 2004) accessed November 23, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

Uganda's market-friendly development strategy and poverty reduction agenda have attracted large financial inflows, including aid. During 2000-02, concerns about a possible aid-induced Dutch disease were heightened by widening macroeconomic imbalances and an upward trend in the real effective exchange rate (REER). This paper shows that the REER remained broadly stable during a 10-year period and nontraditional exports increased remarkably, contrary to the predictions of the Dutch disease model. Also, economic growth was strong. This good performance is attributed to sound macroeconomic policies and important structural reforms, which have allowed an increased use of available production factors.

Subject: Dutch disease, Economic theory, Exports, Foreign exchange, International trade, Poverty, Poverty reduction strategy, Real effective exchange rates, Real exchange rates

Keywords: And poverty, Dutch disease, Economic growth, Exchange rates, Exports, Foreign aid, ODA, ODA flow, ODA inflow, Poverty reduction strategy, Real effective exchange rates, Real exchange rates, REER, Right, Savings-investment balance, Terms of trade, Terms of trade shock, Uganda, Uganda shilling, WP

Publication Details

Pages:

30
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2004/170
Stock No:

WPIEA1702004
ISBN:

9781451858457
ISSN:

1018-5941

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