Uganda has climbed to third place in the 2025 Absa Africa Financial Markets Index, showcasing remarkable strides in its financial sector.
This index assesses financial market development across 23 African countries, spotlighting those offering the strongest environments for efficient markets.
Uganda boosted its overall score from 64 to 66 points, trailing only South Africa (86 points) and Mauritius (76 points).
The country’s ascent, from 10th in 2018, to fifth in 2021, fourth in 2022, and now third in 2025 signals consistent advancement.
Evaluated on factors like market depth, foreign exchange access, transparency, tax and regulatory frameworks, local investor capacity, macroeconomic conditions, and enforceability of financial contracts, collateral, and insolvency rules, Uganda shone brightest in macroeconomic environment and market transparency with 87 points, second only to Botswana’s continental lead. It even surpassed South Africa (78 points) and Mauritius (74 points), thanks to declining inflation and a better non-performing loans ratio.
Uganda’s Strong Showing Amid Varied Segment Performance
Despite uneven results across segments, Uganda posted solid gains in the index.
It earned 46 points in market depth (behind South Africa’s perfect 100 and Morocco’s 63) and 67 in foreign exchange access (20 points shy of South Africa’s lead).
Mauritius topped market transparency, tax, and regulatory environment at 95 points, with South Africa at 91; Uganda scored a respectable 76.
The report praises Uganda’s push to bolster financial infrastructure, including upgrades to central securities depositories for better settlement and liquidity. It notes: “Authorities in Uganda and Zambia are working with Frontclear to develop their domestic interbank and money markets.”
Uganda held fifth in legal standards and enforceability at 85 points, trailing Mauritius and South Africa (both 100). Key highlights include Tradeclear’s June 2024 launch, enabling repo transactions under local GMRA and derivatives via standardized ISDA contracts with Frontclear guarantees. The Bank of Uganda is also advancing the Uganda Netting of Financial Agreements Bill for a clean ISDA legal opinion.
One area for growth: pension fund development, where Uganda scored 15 points (19th place), far from Namibia (100) and South Africa (66).
At the report launch in Kampala Sheraton Hotel, Ramathan Ggoobi, the Permanent Secretary of the Ministry of Finance and Secretary to the Treasury, celebrated the results as fruits of targeted reforms and sound macroeconomic stewardship.
“We are growing in an election year, which is unusual. Uganda ranks among the world’s fastest-growing economies and will sustain this path medium-term. This reflects enduring reforms, expanding nominal GDP, rising per capita income, and tamed inflation,” Ggoobi stated.
He hailed the Ugandan shilling’s regional stability, with exports hitting $13.4 billion alongside steady rises in foreign direct investment, tourism, and remittances.
To elevate its ranking and deepen markets further, Ggoobi outlined government plans: rebuilding capital markets for SME debt and equity, drawing venture capital open to higher risks and lighter collateral, boosting local investor skills, enhancing corporate governance, and recapitalizing the Uganda Development Bank for long-term funding needs.
