This is the third edition of the UgandaEconomic Update series. The first part of this updateprovides a general overview on the state of Uganda'seconomy. Then the second part offers an examination of aneconomic topic of special interest and high relevance forthe country, looking at how to improve service delivery bydistrict governments. In 2013 Uganda managed to sustainmacroeconomic stability and contain a short-lived uptick ininflation caused by fluctuations in regional food prices.This demonstrates the ability of the country'sauthorities to formulate and implement sound macroeconomicpolicies, and lays the foundation for continued achievementof economic growth rates in the range of 6-7 percent. Theimplementation of the large public infrastructure projectsplanned for the next several years should also contribute togrowth. However, it will be as important as ever to keepbudget deficits under control and to make sure thatincreased focus on infrastructure does not slow downprogress in social outcomes. While healthy and educatedpopulation is critical for achieving Vision 2040, findingsfrom the recent Service Delivery Indicators initiativelaunched by the World Bank show that the quality ofUganda's social services still lags behind the qualityof its macroeconomic policies. This update proposes a set ofreforms to improve value-for-money in service delivery, aswell as contain the costs of local public administration.
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