Owing to a drought across East Africa, as well as rapid credit growth, inflationary and exchange rate pressures have risen sharply in Uganda, but the central bank has taken action to control inflation and recent rains should curb supply-side food bottlenecks. Public and external debt levels remain moderate, and relations with donors continue to be strong. We are therefore affirming the 'B+/B' long- and short-term foreign- and local-currency sovereign credit ratings on the Republic of Uganda. The stable outlook balances our expectation that significant donor flows will continue to support Uganda's fiscal performance and its balance of payments against short-term growth being somewhat subdued in the current monetary environment. It also reflects our expectation that the government will continue to
