Ravaged by decades of war and civil strife, Uganda's economy has made a remarkable recovery since the cessation of most rebel activity in 1989. Economic growth has since averaged 6-7% annually, and inflation has averaged only4.7% since 1993-94. Overall, there has been a reduction in the proportion of Ugandans living in absolute poverty. This performance is largely due to continued investment in the rehabilitation of infrastructure, improved incentives for production and exports, gradual improvement in national security, and the return of Indian-Ugandan entrepreneurs.
Museveni has aggressively adopted free market economic policies and embraced sustained economic structural adjustment programs as prescribed by the IMF. This has won him praise as a role model for African Development, and much needed economic assistance, from the IMF, World Bank, and western countries. This level of performance also helped Uganda in 1999 to be the first among least developed countries to qualify for debt relief. With foreign debts totaling about US$3.631 billion, up to US$650 million may be forgiven under the scheme.
In education, Uganda is making big strides, especially with the introduction of universal primary education in 1997. Before then, education was not compulsory in Uganda and all schools charged tuition, making attendance impossible for many children. In 2003 it is anticipated that 700,000 children will complete primary school compared with fewer than 200,000 in 1997. "Progress on universal primary education is the most important legacy for any government in the developing world," Museveni's wife, Janet, was quoted as saying upon receiving the Pencil Award from Oxfam's Education Now program in April 1999, for the country's success in using money saved from debt relief for universal education.
There is growing concern, however, over the government's inability to build political consensus in the country. The Lord's Resistance Army (LRA), a cult-like Christian rebel group operating in northern Uganda from bases in southern Sudan; the Allied Democratic Forces (ADF) which has stepped up rebel attacks in western Uganda from the DRC since 1997; and other groups, including Rwanda Hutu rebels, Uganda National Rescue Front-II, and the Uganda National Front/Army have committed rape, kidnapping, torture, child abuse (they use abducted children as combatants, or sex and labor slaves), and murder of several hundred noncombatants, and other human rights abuses. UNICEF estimates that LRA and ADF have abducted over 4,900 men, women and children since 1987, most of whom remain missing.
Museveni has tried to end the fighting through diplomacy and military means. He reluctantly accepted an Amnesty Bill in January 2000, which provided for pardon to any rebels who surrendered their arms within 6 months. Three months later, no rebels had complied. A highly publicized all-out offensive in 2002 also failed to achieve its goals, and independent observers have accused government troops of killing innocent civilians including women and children. Failure to end the war has driven away foreign investment, tourism, and has diverted funds away from other ministries to defense, cancelling much of Uganda's economic and social progress.
Uganda has one of the fastest growing populations in the world. However, in 2002 there was little political or programmatic progress in bringing the birth rate under control. The provisional 2002 Census data indicated that Uganda experienced an average annual growth rate of 3.4 percent between 1991 and 2002. This was 36% higher than the annual growth rate of 2.5% over the previous decade, and was mainly due to persistently high fertility (total fertility rate=6.9). Even if fertility rates declined, the UN's 'low variant' population projection has Uganda's population growing from 24.7 million in 2002 to 88 million by 2050.