Museveni Blames Gulf Conflict for Shilling’s Depreciation, Rising Fuel Prices

What the report says

President Yoweri Museveni said Uganda’s weaker shilling and higher fuel prices are being driven largely by conflict in the Gulf region, according to Nile Post. He made the remarks during Uganda’s 64th Independence Day celebrations at State House Entebbe on Friday, saying government would not use foreign exchange reserves to try to prop up the currency.

Museveni said the Bank of Uganda had suggested selling dollars from reserves to ease pressure on the shilling, but he declined. Instead, he urged Ugandans to rely more on locally made goods and less on imports, arguing that stronger domestic production would help the country absorb external shocks. He also said government had previously negotiated a temporary supply arrangement with commodities trader Vitol that helped limit fuel price increases for a few months.

The article says the shilling has faced sustained pressure in recent months, while fuel prices have climbed in some parts of the country. Nile Post noted that official and market reports have linked part of this pressure to foreign currency demand, supply-chain disruption and geopolitical tensions affecting global fuel markets. Higher fuel costs can also feed into transport and consumer prices.

Museveni also referred to the Ebola outbreak as another challenge affecting travel and economic activity. The broader background, as reported by the publisher, is that Uganda’s economy has remained on a growth path, but officials and international institutions have warned that exchange-rate weakness and energy costs could still affect inflation and household expenses.