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State of Nation Address 2026 : Uganda’s Economy Targets $80 Billion

Uganda has moved from being a Least Developed Country to a Lower Middle-Income Country

by Wasswa Deo
June 4, 2026
in News
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President Yoweri Kaguta Museveni has declared a new phase in Uganda’s development journey, rallying citizens and leaders to embrace hard work, reject corruption and hold public officials accountable as the country prepares for accelerated economic growth and the anticipated commencement of commercial oil production.

Delivering the State of the Nation Address at Kololo Ceremonial Grounds on Thursday, Museveni thanked Ugandans for their participation in the 2026 electoral process and for what he described as overwhelming support for the National Resistance Movement (NRM). He attributed the country’s continued peace and stability to God and the efforts of security agencies despite what he called persistent attempts by “evil people” to disrupt the country.

The President centered his address on the slogan “No More Sleep,” a message he first introduced during his inauguration. He clarified that the slogan is not merely about remaining alert but represents a broader campaign against corruption, laziness, poor leadership, diversion from national priorities and tolerance for non-performance.

“No more corruption, no more kukongola, no more kugumaaza, no more kuhenda and no more politeness to non-performers,” Museveni declared, urging leaders at all levels to focus on results rather than personal interests and political ego.

The President used much of his speech to trace Uganda’s economic transformation from the pre-independence period through the NRM’s four decades in power. He recounted his early efforts in the 1960s to mobilize communities in the cattle corridor to abandon nomadism and adopt commercial agriculture, describing those campaigns as the foundation of Uganda’s modern dairy industry.

Museveni narrated how he and his colleagues traveled long distances with minimal resources to sensitize rural communities about wealth creation through commercial farming. He argued that ideas and practical guidance, rather than financial handouts, were responsible for changing livelihoods across large parts of the country.

According to the President, Uganda’s annual milk production has risen from 200 million litres in 1986 to 5.4 billion litres today. He said the dairy sector now saves the country an estimated $1.56 billion in imports while generating more than $285 million in export earnings annually.

He noted that Nyabushozi County alone now delivers approximately 1.15 million litres of milk every day and hosts 115 milk coolers, reflecting the transformation that has occurred in the cattle corridor. Museveni challenged farmers to move further away from free-range grazing and embrace pasture cultivation and zero-grazing systems to maximize land productivity.

The President also highlighted government interventions aimed at integrating households into the money economy. He cited programmes such as Entandikwa, NAADS, Operation Wealth Creation, Emyooga and the Parish Development Model (PDM) as key vehicles for poverty reduction and wealth creation.

Museveni revealed that PDM funds have already reached 3.7 million households, with Shs557 million currently available per parish. He announced that government plans to continue allocating Shs100 million annually to each rural parish and Shs300 million to urban wards, alongside facilitation funds for local leaders.

For larger investors, he said government has injected Shs1.6 trillion into the Uganda Development Bank to provide affordable financing for agriculture, manufacturing and industrial development.

The President argued that Uganda’s future prosperity lies in four sectors: commercial agriculture, manufacturing, services and information and communications technology. He maintained that access to affordable capital could be expanded further if demand increases.

Museveni credited peace and infrastructure development for creating the conditions necessary for economic growth. He highlighted extensive road construction projects linking Uganda’s borders from north to south and east to west, as well as ongoing investments in railway transport and petroleum pipelines.

He said government is revamping the metre-gauge railway while simultaneously pursuing the standard gauge railway project in collaboration with regional partners. These investments, he explained, are intended to reduce pressure on roads and improve the movement of cargo and petroleum products.

On regional integration, Museveni reiterated the NRM’s longstanding commitment to Pan-Africanism, arguing that Uganda’s domestic market alone cannot sustain long-term economic growth. He said Africa’s economic integration is essential for prosperity while political integration within East Africa remains important for collective security.

Responding to critics who argue that Uganda has failed to make meaningful progress over the past four decades, the President strongly defended the NRM’s record. He dismissed claims that the country has been “wandering in the desert” and instead pointed to significant gains in economic growth, poverty reduction and social indicators.

Museveni said Uganda has moved from being a Least Developed Country to a Lower Middle-Income Country. He noted that the country’s Gross Domestic Product has expanded from $3.9 billion in 1986 to $69.3 billion today using the exchange-rate method and to $197.1 billion under purchasing power parity calculations.

The President reported that GDP per capita has risen to $1,278, surpassing the lower middle-income threshold of $1,136. He added that household poverty has fallen from 56.4 percent in 1992 to 16.1 percent, while life expectancy has increased from 43 years to 68 years.

He further noted that infant mortality has dropped from 122 deaths per 1,000 live births to 36 deaths per 1,000 live births over the same period.

Looking ahead, Museveni projected economic growth of 6.4 percent this financial year and 10 percent in the next financial year, which he said would push the economy to approximately $80 billion even before commercial oil production begins.

The President reported that Uganda’s exports reached $18 billion in the twelve months ending March 2026. He attributed this growth to diversification and industrialization, citing exports of pharmaceuticals, refined gold, steel products, ICT equipment, plastics, ceramics and dairy products.

He also highlighted major increases in agricultural production, including coffee exports rising from two million bags in 1986 to 9.3 million bags today, maize production increasing to five million metric tonnes, and sugar output reaching 700,000 metric tonnes.

In the energy sector, Museveni said electricity generation has increased from 60 megawatts in 1986 to 2,098 megawatts. He revealed government’s long-term ambition to expand power generation capacity to 50,000 megawatts through hydroelectric, solar, gas, wind, geothermal and nuclear energy projects.

The President stressed that irrigation remains a key priority for transforming agriculture, highlighting government partnerships to establish solar-powered irrigation systems across multiple districts including Ngora, Serere, Bukedea, Amolatar, Kwania, Apac, Kasanda, Masaka and Mukono.

Despite the progress, Museveni identified two major challenges facing rural communities: continued dependence on free-range livestock farming and the fragmentation of land through inheritance. He advocated family-owned companies as a solution to land subdivision, arguing that larger and more productive holdings are necessary to sustain future growth.

The address concluded with a call for leaders to intensify implementation of government programmes and ensure all households with productive land participate in the money economy.

“Leadership is not for ego but for the people and the country,” Museveni said, reiterating his central message that Uganda’s next phase of development requires discipline, accountability and a renewed commitment to wealth creation.

The President also presented the government’s legislative programme for the 2026/27 financial year, which includes proposed laws covering education reforms, agriculture regulation, tourism, railways, real estate, health sector reforms, workers’ compensation and amendments to several tax laws.

As Uganda approaches commercial oil production and pursues ambitious industrialization targets, Museveni’s address signaled a renewed push for economic transformation, with government placing responsibility on both leaders and citizens to accelerate the country’s journey toward prosperity.

Wasswa Deo

Wasswa Deo

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