KAMPALA.The latest Regional Economic Outlook by the International Monetary Fund has ranked Uganda the second fastest-growing economy in Sub-Saharan Africa.The report places Uganda which has a projected growth rate of 7.5 percent in 2026 behind Ethiopia, which is expected to lead the region with a growth rate of 9.2 percent.Rwanda follows in third position at 7.2 percent, while Benin and Niger are projected to grow at 7.0 percent and 6.7 percent respectively. Côte d’Ivoire rounds out the top performers with 6.2 percent growth.Uganda’s strong outlook comes despite a broader slowdown across the Sub-Saharan African region.The IMF has downgraded regional growth projections, citing the economic impact of ongoing conflicts in the Middle East.Speaking during a press briefing in Washington, D.C. on April 16, on the sidelines of the World Bank and IMF Spring Meetings, the IMF’s African Department Director, Abebe Aemro Selassie, said 2025 had marked a year of hard-earned stabilisation gains for the region. However, he warned that these gains are now under pressure.“The war in the Middle East is a major new external shock,” Selassie noted, pointing to surging prices for oil, gas, and fertilisers, rising shipping costs, disrupted trade with Gulf countries, and declining tourism and remittances. He added that financial conditions have tightened, particularly for fuel-importing economies.As a result, the IMF has revised Sub-Saharan Africa’s growth forecast downward to 4.3 percent in 2026—about 0.3 percentage points below earlier projections—while median inflation is expected to rise to 5 percent by the end of the year.The impact of these shocks varies across countries. Oil-exporting nations may benefit from higher revenues but remain exposed to price volatility, while oil-importing countries—especially fragile and low-income states—face worsening trade balances, rising living costs, and limited fiscal buffers.The IMF also highlighted a significant decline in official development assistance, describing it as a structural shift rather than a temporary cycle.This trend is expected to disproportionately affect vulnerable countries that rely heavily on aid for essential services such as healthcare, food assistance, and budget support.In response, the IMF is urging policymakers to prioritise measures that stabilise economies and protect vulnerable populations. In the short term, countries are advised to keep inflation under control and provide targeted support to those most affected by rising costs.Fiscal policies, the Fund says, must strike a balance between maintaining credibility and allowing flexibility in the face of shocks.Over the medium term, the IMF emphasises the need for structural reforms to drive private sector-led growth.These include improving governance, strengthening the business environment, and expanding domestic financial markets.Greater regional integration—particularly through the African Continental Free Trade Area—is also seen as key to enhancing resilience and unlocking new economic opportunities.Looking further ahead, the Fund underscored the importance of boosting productivity through strategic investments and innovation.The adoption of technologies such as artificial intelligence in sectors like agriculture, healthcare, and public services could play a transformative role, provided countries invest in reliable electricity, digital infrastructure, and skills development.Despite current challenges, the IMF remains cautiously optimistic. It noted that the region has demonstrated resilience through repeated crises and continues to pursue reforms.“The gains of 2025 are real, and they are worth defending,” Selassie said, adding that policy decisions taken now will determine whether these gains can be sustained and translated into broader, more inclusive growth.The IMF reaffirmed its commitment to supporting countries in the region through financing, policy advice, and capacity development as they navigate the evolving economic landscape.