| dc.description.abstract | Most countries at one time borrow; this is usually because of the complexity and increased demand for better goods and services a midst changing roles of government and limited tax resources concerning the planned public expenditures. This is because One most important objective of macroeconomic policies in the recent years has been the attainment of sustainable economic growth and well fare of its citizens in terms of infrastructure like road network, industrialization, security and many others.
Uganda like many other developing countries has a long history of borrowing from both multilateral and bilateral countries. This has become so chronic and increasing yearly but the question remains that bear the persistent debt burden.
In search for answers to this question, this study seeks to establish the effects of a continued rise in Uganda’s Public debt by reviewing its effect on economic growth, consumer prices and to forecast the Public debt figures in the next few years 1993 to 2021. We used secondary data obtained from world bank data for the period between 1993 to 2021 where it was found out that a 1 percent unit increase in Public debt would negatively affect economic growth by 1.22 percent, while the same change would occur when there’s a 1 percent increase in external debt, it would affect the inflation rate by 0.67 percent meaning there will be an increase in the general price level in the country. Based on the significance of the p-value of the constant in the regression model, it was also found that other factors affect economic growth and inflation rate other than external public debt.
Conclusion:
Based on the general and specific objectives of the study, it was viable to conclude that Public debt affects an economy’s growth and inflation rate in the long run, if the Public debt keeps on accumulating over the years and it’s not invested in productive activities to realize economic growth and reduced prices in the country.
Implying that all the citizens of Uganda even in the near future with the persistent increasing debt burden, the generation yet to come shall all have a share of these debts. | en_US |
