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Uganda's Experience with Aid

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  • Kasekende, L A
  • Atingi-Ego, M

Abstract

This paper presents Uganda's experience with aid flows over the period 1970-96. It discusses the compilation of aid data and also reviews the chronological developments in aid flows to Uganda. Over this period, the sectoral distribution and type of aid is largely dictated by the government's economic programmes in place. The period 1962-71 largely reflects government borrowing for on-lending to agriculture and industry whereas the period 1979-85 shows a wider range of sector-specific programmes driven by the need to reconstruct and rehabilitate the economy. Although the need to reconstruct and rehabilitate the economy continued, support for policy reform began to take up an increasing proportion of aid over the period 1987-96. We also analyse the impact of aid on some major macroeconomic variables and find that investment and real exchange rate developments have been largely driven by official development aid flows. Although we find a similar relationship between aid and improved policy environment, the findings show that in the latter part, i.e., 1992-96, the continued policy reform was driven more by ownership of the programme than by aid. Indeed, in this latter period, the aid/GDP ratios declined. The major lesson drawn from this study is that ownership of a reform programme is more critical for its success, hence our conclusion that aid should be used for financing rather than buying reforms. Copyright 1999 by Oxford University Press.

Suggested Citation

  • Kasekende, L A & Atingi-Ego, M, 1999. "Uganda's Experience with Aid," Journal of African Economies, Centre for the Study of African Economies, vol. 8(4), pages 617-649, December.
    • Handle: RePEc:oup:jafrec:v:8:y:1999:i:4:p:617-49
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    Cited by:

    1. Ayoki, Milton, 2008. "Causes of slow and low disbursement in donor funded projects in Sub–Saharan Africa: Evidence from Uganda," MPRA Paper 87106, University Library of Munich, Germany.
    2. Sylviane GUILLAUMONT JEANNENEY & Patrick GUILLAUMONT, 2006. "Big Push versus Absorptive Capacity: How to Reconcile the Two Approaches," Working Papers 200614, CERDI.
    3. Jean-Louis COMBES & Patrick PLANE & Tidiane KINDA, 2010. "Capital Flows and their Impact on the Real Effective Exchange Rate," Working Papers 201032, CERDI.
    4. Adam, Christopher S. & Gunning, Jan Willem, 2002. "Redesigning the Aid Contract: Donors' Use of Performance Indicators in Uganda," World Development, Elsevier, vol. 30(12), pages 2045-2056, December.
    5. Musisi, A.A., 2006. "Physical public infrastructure and private sector output/productivity in Uganda: a firm level analysis," ISS Working Papers - General Series 19182, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.

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