Uganda’s economy expanded at a robust 8.5% pace in the quarter ended December 2025, accelerating from 5.4% a year earlier, as strong consumer demand and brisk activity in construction and related sectors fueled growth, the Finance Ministry said.
The surge reflects resilient household spending amid stable prices and ongoing public and private investments, officials noted. Construction proved particularly dynamic, supported by major infrastructure initiatives.
Analysts attribute much of the momentum to rising private consumption, which has benefited from improved access to credit and a stable macroeconomic environment. Sectors such as manufacturing, services and agriculture also contributed, painting a picture of broad-based recovery.
The Ministry highlighted that domestic demand continues to anchor growth even as the country prepares for the transformative impact of its nascent oil industry.
In a post on the X platform late on Tuesday, the ministry announced that construction of the USD5 billion East African Crude Oil Pipeline had reached 80% completion. The 1,443-kilometer (897-mile) pipeline will transport crude from oil fields in western Uganda to the port of Tanga on Tanzania’s Indian Ocean coast.
This critical infrastructure project, developed with partners including France’s TotalEnergies and China’s CNOOC, marks a key step toward unlocking Uganda’s petroleum potential.
Oil production set to boost future revenues
After years of delays, Uganda expects to begin commercial oil production in the second half of 2026 from fields operated by France’s TotalEnergies and China’s CNOOC. The government forecasts revenues of 2.2 trillion Ugandan shillings or USD587.04 million from oil exports in the 2026/2027 financial year (July-June).
Officials say these inflows will help fund infrastructure and social programs, potentially lifting overall growth into double digits in coming years. However, global energy transitions could influence long-term returns.
The latest figures underscore Uganda’s resilience despite regional and global challenges. Economists expect momentum to continue as oil-related activities ramp up, though sustained fiscal discipline and investment in productive sectors will remain essential.
