External Environment


FY 2021/22 commenced at the peak of the deadly Delta Variant of Covid-19 that necessitated partial lockdowns in various parts of the world. In Uganda, a 42-day lockdown that ran until 30 July 2021, was instituted, and some sectors such as education and entertainment remained fully closed. Infection rates and deaths had significantly reduced by the end of the first half of the year which led to the easing of restrictions in most economies. Uganda, which was among the countries with the longest lockdowns, also fully opened in January 2022.

Since the onset of the Covid-19 pandemic, the Fund has acted with agility by implementing a hybrid operating model. Staff were provided with the relevant tools required to work effectively from home. Staff health and wellbeing was a key focus, and a formalised programme was introduced to monitor and promote health and wellbeing.

our response

war on ukraine

During the second half of the year, global economic recovery slowed down due to disruptions in global supply chains caused by the effects of Russia’s invasion of Ukraine in February 2022. Sanctions on Russia created shortages in goods and services, especially fuel and gas that led to a spike in inflation in most economies.


The effects of inflation are many, including, increased cost of doing business, high cost of living, reduction in aggregate demand; and in extreme cases, inflation results in a recession, and civil unrest.


Operational and capital expenditure were both impacted due to the general increase in commodity prices. Ongoing projects under construction in our Real Estate Portfolio were greatly impacted with prices of construction materials rising by close to 40%. Contractors on projects applied for contractual price adjustments.

Operational Expenditure: The impact on operational expenditure was minimal. The Fund has in place budget control mechanisms that ensure efficient use of resources. It also maintains the flexibility to reallocate resources where the need arises whilst ensuring that expenditure stays within the overall budget range.


Capital Expenditure: Justifiable adjustments to contractual prices were acceptable subject to the necessary approval process. This was to ensure the continuity of ongoing projects to minimise unnecessary delays.


Fixed Income and Equity Portfolios: Due to the long maturity profile of the Fund’s liabilities, the Fund takes a long-term investment approach for the majority of its investments. Rising interest rates in the US and Europe led to sell-offs by international investors who liquidated their investments in emerging and frontier markets. Given the Fund’s long-term investment strategy, this presented viable investment opportunities.

our response

Global economic growth

The International Monetary Fund (IMF) projected global growth rates to decline from an estimated 6.1% in 2021 to 3.6% in 2022 and 2023. This is 0.8 and 0.2 percentage points lower for 2022 and 2023 than projected in January 2022.

Regional economic growth Amidst all the challenges, some achievements were registered on the East African Regional front and are expected to boost economic growth in the region. These include:
  • Admission of the Democratic Republic of Congo into the East African community that expands the regional market for goods and services among other benefits.
  • Rwanda announced the reopening of the Katuna border post with Uganda on 31 January 31 2022, ending a three-year impasse.
  • Uganda signed the Oil and Gas Final Investment Decision on 1 February 2022. This signified the commitment of oil companies to invest about USD 10 billion and develop Uganda’s oil and gas resources.

Domestic economic growth Preliminary GDP estimates by the Uganda Bureau of Statistics (UBOS) indicate that the economy grew by 4.6% in FY 2021/22 from a revised growth rate of 3.5% the previous year. Economic activity is projected to remain modest as the shocks to commodity prices, production and distribution disruptions, and global inflation continue to dim the prospects for domestic economic growth. The shilling depreciated for the first time in two years against the dollar in April 2022 and continued to weaken sharply in May-June 2022.  This was due to the weak exports alongside increased US dollar demand for project-related capital imports amid heightened global uncertainty given the Russia-Ukraine conflict.

Through the Fund’s innovation strategy, we aim to create an eco-system and community of innovators.  To this end, the Fund promotes entrepreneurship and supports small businesses that have the potential to scale and bring new economic opportunities to Uganda. These will enable a future pipeline of contributions and new investment opportunities.

our response

Regulatory landscape

The National Social Security Fund Amendment Act 2022 was assented to by the President on 2 January 2022. The Amendment Act brought about changes that included a stakeholder board, mandatory contributions of all workers regardless of the size of the enterprise, voluntary contributions to the Fund and midterm access for qualifying members, among others.

In anticipation of the NSSF Amendment Act, the Fund undertook an organisational redesign to enable efficient processing of benefit claims for midterm access.


The Fund is now well positioned to capitalise on the limitless opportunities presented by the change in law and accelerate innovation, bringing new products and services to the market in response to the short-term and long-term investment needs of anyone in the public and private sector who wishes to save with NSSF.

our response

Evolving social and regulatory expectations to climate risk and ESG-related topics

A worldwide trend is regulators and investors focus on ESG-related disclosure requirements. Several companies are undertaking comprehensive reviews of their ESG-related strategy and disclosure.


Many financial regulators are focusing on climate risk management and climate change’s effects on financial stability. This following the adoption of the Paris Agreement on climate change and the UN 2030 Agenda for Sustainable Development in 2015, governments are making strides to transition to low-carbon and more circular economies on a global scale. Transitioning entails both risks and opportunities for the economy and financial institutions, while physical damage caused by climate change and environmental degradation can have a significant impact on the real economy and the financial system.


Socially there are numerous examples of social unrest, boycotts, rising unemployment and poverty, gender-based violence, calls for more inclusivity and upliftment etc.


With a plethora of regulations, frameworks, codes, and standards like GRI, SDGs, new IFRS, etc., we are:

  • Continuing to report our commitment to the Global Reporting Initiative (GRI)
  • Demonstrating our commitment to 11 prioritised SDGs in our sustainability interventions and reporting
  • In the process of sourcing an external service provider to conduct a benchmarking exercise on ESG best practice
  • Investing responsibly whilst adhering to set standards and following best practice especially in our Real Estate portfolio
  • Keeping abreast of the developments in ESG related disclosures required by IFRS. – these are still under development