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[QUOTE="Munyaradzi Mafaro, post: 40271, member: 636"]
Uganda spends enormous amounts of money paying back loans instead of building the country. Economics professor Dr. Fred Muhumuza from Makerere University explained this problem during the Musevenomics Conference held at Kampala. Government officials take funds away from development projects to cover debt payments and interest costs. The professor said roads cannot be built because borrowed money takes priority over construction needs. Economic experts worry about lost opportunities when debt service becomes the main budget focus.

The national budget reached 72.1 trillion shillings for 2024/25 but officials allocated 34.3 trillion just for loan payments. Uganda pays fees on money that sits unused after borrowing from international lenders. The Auditor General discovered 73.9 billion shillings wasted on commitment charges for 1.89 trillion worth of undisbursed loans. Some projects like the Mbarara-Masaka power line and Luwero-Butalangu road upgrades barely used any borrowed funds. Disbursement rates dropped as low as 0.3 percent for certain development loans.

Hospital medicine purchases suffer when nearly half the budget goes toward debt management. Schools receive less funding because loan payments consume available resources before other priorities. Research programs lose money that could advance scientific discoveries and innovation. Parliament approved spending plans that dedicate 25 percent of domestic income to debt service rather than the recommended 12 percent maximum.
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