KAMPALA - Uganda plans to spend 48.1 trillion Ugandan shillings ($12.83 billion) in the fiscal year starting next month, more than 7% higher than the current year, as it tries to drive an economic recovery from the COVID-19 pandemic.

But thanks to a larger projected increase in budget and grant revenue the east African country sees a smaller deficit of 5.4% of gross domestic product (GDP) in the 2022/23 fiscal year, down from 7.3% of GDP in 2021/22, Finance Minister Matia Kasaija said.

Uganda plans to borrow around 5.0 trillion shillings ($1.3 billion) from domestic markets and 4.7 trillion shillings from external markets, Kasaija said, adding that no new taxes would be introduced in 2020/23.

The country's international reserves at the end of April increased to $4.5 billion, up from $3.6 billion a year earlier.

(Reporting by Elias Biryabarema, Writing by Hereward Holland, Editing by Alexander Winning)