Address income inequalities, UNDP tells govt

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Uganda has launched the 2025 United Nations Human Development Index (HDI). The Thursday, May 15, 2025, launch in Kampala city was held with a call for the country to take more decisive action to tackle the issue of income inequality.

Dr Thangavel Palanivel, a senior economic advisor and head of strategy and policy at the United Nations Development Programme (UNDP), stated that while Uganda has made significant strides in health and education, there remains considerable work to do in addressing income inequalities.

He emphasized that this challenge is not unique to Uganda but is a common issue faced by many African countries.

One proposed intervention is to improve productivity in the agricultural sector, which employs around 70 per cent of the Ugandan population.

“Agriculture remains the backbone for many in Africa, yet it continues to suffer from low productivity,” he said, adding that income inequality affects access to essential services, including healthcare and education.

Dr Palanivel acknowledged the Government's efforts over the past few years to address income inequality but observed that the reductions have been “marginal.”

The United Nations uses the Gini coefficient, or Gini index, to measure inequality on a scale from 0 to 1, where higher values indicate greater inequality.

Palanivel remarked that 15 years ago, the Gini index was at 5, but it has now risen to 6, underscoring the need for urgent action to reduce poverty.

Dr Palanivel Thangavel, UNDP senior economist presenting the Human Development Report 2025 during the launch at Kyambogo University on 15th May 2025.

He pointed out that inequality is a key driver of poverty and makes it more difficult to reduce it.

Palanivel made these comments during the launch of the United Nations Human Development Index (HDI) at Kyambogo University. The event was attended by science, technology, and innovation minister Dr Monica Musenero, who represented Prime Minister Robinah Nabbanja.

The objective of the HDI report is to shift the development paradigm from economic growth to human well-being. This year's report, released under the theme: Breaking the Gridlock, focuses on the role of artificial intelligence (AI) in human development.

Uganda’s Progress

The report indicates that Uganda has improved its ranking by two positions, now sitting at 157 out of 193 countries assessed by the United Nations. This is an improvement from 159th in the previous year (2023/2024) and from 166th in 2021.

In East Africa, only Kenya (143) ranks higher than Uganda. The index also shows that Rwanda (159), Tanzania (165), the Democratic Republic of Congo (171), South Sudan (193), Burundi (187), and Somalia (192) rank below Uganda.

This ranking places Uganda in a tie with Ivory Coast in West Africa, which has improved by 10 places. Furthermore, Uganda has consolidated its position among medium human development index (MHDI) countries.

In East Africa, there are now three countries in the MHDI category after Rwanda joined Kenya and Uganda, which have been the only East African countries in this band.

Rwanda became an MHDI country this year after climbing from 165th to 159th place while Uganda joined in 2023.

MHDI countries are ranked between 125 and 167 on the index, which measures efforts taken by nations to improve the well-being of their citizens in key areas such as education, income, and healthcare.

For many years, only Kenya was classified as an MHDI country in East Africa, but now Uganda and Rwanda are included as well. According to Palanivel, Uganda’s improvement is attributed to investments in health and education.

However, 28 countries on the continent have not made progress and remain in a lower human development index, including Nigeria, Africa’s largest economy, and Ethiopia, which has a higher GDP than Uganda.

During the event, Palanivel highlighted that despite the improvements that have narrowed the gap between the top-ranked countries and those at the bottom from 1990 to 2019, inequalities are widening again, a situation exacerbated by the COVID-19 pandemic, which severely impacted the economies of less developed countries.

Healthy lives

Nwanne Vwede-Obahor, the UNDP resident representative for Uganda, commended Uganda for its progress, noting that from 1990 to 2023, the country's HDI improved by 70.2 per cent.

However, she clarified that MHDI status is not the same as middle-income status, which is determined by the World Bank using per capita income.

She attributed Uganda’s improvement to increased life expectancy and longer years of schooling, thanks to various pre-development policies.

“Although Uganda’s HDI exceeds the sub-Saharan Africa average of 0.568, it remains below the global average of 0.756, signalling both progress and the need for accelerated action,” she stated.

She urged Uganda to leverage emerging technologies, including AI, to accelerate development and address the digital divide, particularly between urban and rural areas.

“AI has the potential to revolutionize our approach to development and economic empowerment,” she noted.