By Ahura Mujuni Mark

The International Monetary Fund says Uganda’s tight monetary stance to counter inflation has sharply slowed economic growth but medium-term growth will reach its potential level of 6 percent to 7 percent.

“Reviving economic activity is therefore an urgent priority for Uganda’s low-income economy,” the IMF said in a statement late on Monday.

“To this end, the authorities’ short-term policies are appropriately geared at maintaining essential public investment and encouraging a gradual resumption of bank lending, while continuing to allow the shilling to reflect market conditions.”

The IMF forecast in November the Ugandan economy would grow 5 percent in the 2012/13 fiscal year from 3.4 percent in the previous period.