Ugandan Shilling Hits Greatest Low in 18 Years

Thursday, August 11, 2011
By ugandansabroad

The shilling is the worst-performing currency against the dollar in the world so far this year, depreciating to 2,780 per dollar around 4 p.m. today.  Oil importers and telecommunication companies have played a strong role in the demand for U.S. currency, Bloomberg reported.

The shilling is the weakest against the dollar that it has been since July 1993.  The U.S. dollar has been strengthening significantly on the international markets as well, despite the S & P downgrade of the United States, due to international financial turmoil, particularly in the Eurozone.

Besigye and opposition supporters mourn the loss of a toddler shot by security agents, before pledging to restart the walk-to-work demonstrations. Photograph by Edward Echwalu,

In June, the shilling traded at sh2735/2750, but a Central Bank intervention strengthened it to sh2400, New Vision reported.

President Museveni spent one-third of the state budget—or 1.3 billion USD—in just the month of January 2011, shortly before the national elections.  $720 million was also spent on buying six Russian fighter jets, the Council on Foreign Relations reported.

Ugandan opposition leaders vowed yesterday to begin protests over the rising cost of living, particularly fuel and food, AFP reported.  Inflation last month reached 18.7 percent.

Kizza Besigye and other opposition politicians pledged to restart the walk-to-work protests at a candlelight vigil in Masaka for a toddler shot by a security officer in April.  Besigye was recently cleared of all charges against him connected to the demonstrations early this year.

As opposition supporters went to lay a wreath at the home where the child was shot, the army and police fired teargas into the crowd.  The Ugandan police spokeswoman Judith Nabakooba said any protest would be stopped for security reasons.

Kikuubo Lane, during the Kampala City Traders Association (KACITA) strike. Photograph by Edward Echwalu,

The Minister of Security, Wilson Muruli Mukasa, said that the opposition is using Twitter, Facebook, and Youtube as part of a “grand plan” to topple the government, BBC News reported.  Social media was being used, he said, to “psychologically prepare the people, especially young people, for armed insurrection”.

The government has voiced concerns that Besigye will organise an Egypt-style uprising gain power through the streets after losing elections in February, according to BBC News.

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