As Uganda continues the inevitable path of debt acquisition for development, lessons can be drawn from utilization challenges leading to debt accumulation for future reflection. The rate of contracting new loans has over the years risen much faster than the rate of absorption. By end of June 2016, the total debt outstanding was at 52% of GDP, of which only 34% of GDP was disbursed.
The Auditor General validates this position in his report (December, 2016) for FY 2015/16 which indicated UGX 18 trillion remaining undisbursed attracting commitment fees of UGX 20billion. The same report notes that undisbursed loans attracted commitment fees worth USD18.8m between 2007/08 and 2015/16. Also, the level of disbursed loans reduced from 63% of the total external debt to 51% in the same period. The report also highlights that out of 96 loans sampled for the period 2010 to June 2016 totaling to USD8.8 million, only 24.5% was disbursed.