By Joseph Mary Buwule
KAMPALA.Uganda has remained in the World Bank’s low-income category despite years of robust economic growth.
This highlights the challenge of raising average incomes quickly enough to meet both international income thresholds and the country’s ambitious long-term development goals.
While the government has celebrated transitioning into the lower-middle-income threshold (> $1,136) in recent years, the World Bank’s global metrics maintain the country’s low-income status due to rapid population growth and high dependency ratios.
The World Bank’s latest Country Income Classifications, released on July 1, place Uganda among 25 low-income economies for the 2027 fiscal year.
Countries in this category have a Gross National Income (GNI) per capita of $1,175 or less, calculated using the World Bank’s Atlas methodology based on 2025 data.
Uganda joins countries including the Democratic Republic of Congo, Ethiopia, Somalia, South Sudan, Sudan, Burundi and Malawi in the lowest income bracket.
The annual classification, which covers 218 economies and remains in force until the end of June 2027, is widely used by governments, investors and development partners to determine eligibility for concessional financing and to benchmark countries’ development progress.
The World Bank said six countries moved into higher income categories this year, each through different pathways.
Togo graduated from low-income to lower-middle-income status after revised census results reduced its estimated population by nearly 12 percent, increasing income per capita, alongside economic growth of 5.9 percent.
Vietnam and the Philippines advanced following years of sustained, broad-based economic expansion, while Sri Lanka returned to lower-middle-income status after recovering from its 2022 financial crisis.
Jordan’s reclassification followed a statistical rebasing that showed its economy was nearly 10 percent larger than previously estimated, while Micronesia also moved up after steady post-pandemic growth.
Uganda’s continued classification as a low-income economy comes even as the government pursues an ambitious strategy to expand the country’s economy tenfold to $500 billion by 2040.
Speaking at the launch of the World Bank’s Country Partnership Framework (2026–2035) and the Uganda Public Finance Review in Kampala earlier this year, World Bank Senior Operations Officer Amanchi Jean-Noel Gogoua said Uganda would need to sustain average annual economic growth of about 10 percent over the next 15 years to achieve that target.
The World Bank’s new Country Partnership Framework is aligned with Uganda’s Vision 2040 and the government’s Tenfold Growth Strategy, with a focus on accelerating private sector-led growth and creating more productive jobs.
Gogoua said Uganda stands at a critical turning point, with commercial oil production expected to begin in 2027, offering what he described as a once-in-a-generation opportunity to accelerate economic transformation.
He also pointed to the country’s youthful population, noting that about 75 percent of Ugandans are under 30 and roughly 650,000 young people enter the labour market every year.
However, he warned that deep structural constraints continue to hold back income growth
About 92 percent of Uganda’s workforce remains in the informal sector, while the country’s Human Capital Index stands at 0.39, meaning a child born today is expected to realise only 39 percent of his or her productive potential because of shortcomings in health and education.
He also highlighted infrastructure and fiscal challenges, noting that non-oil tax revenue amounts to 13.5 percent of GDP, only about 9 percent of Ugandans have access to the national electricity grid, and digital connectivity stands at roughly 50 percent.
The World Bank noted that income classifications are determined by GNI per capita, rather than total economic output alone.
The measure, calculated in U.S. dollars using the Atlas methodology, adjusts for exchange rate fluctuations and inflation, while population growth, national accounts revisions and changes in economic performance can all influence a country’s classification.
Uganda’s economy has expanded steadily in recent years, with growth projected to exceed 6.5 percent as oil production begins.
However, rapid population growth has continued to dilute gains in average income per person, leaving the country below the threshold for lower-middle-income status.
Globally, the number of low-income economies has fallen sharply over the past four decades. Since 1987, the share of countries in the lowest income category has declined from 30 percent to 11 percent, although the pace of progress has varied significantly across regions.
The World Bank said its income classifications remain an important global benchmark for measuring economic progress, while acknowledging that no single indicator can fully capture the complexity of a country’s development.