Uganda reaping dividends of industrial development – UIA’s Lawrence Byensi

Walking in downtown Kampala one comes across many products made in Uganda like steel, building materials like iron sheets, cement, tiles, processed foods, household items, electronics, apparels, etc. 

Gone are the days when most merchandise on the Ugandan market was imported. It is heart-warming to know that many of these products are actually made in Uganda. Yes, Made-in-Uganda, thanks to the protracted efforts of, in large part, Uganda Investment Authority (UIA), the chief investment promotion agency of the Government of Uganda.

As UIA celebrates 30 years this year, it can only take pride in having made significant contributions to Uganda’s industrialization process. Through UIA’s investment promotion efforts, Uganda’s Foreign Direct Investment (FDI) and Domestic Direct Investment (DDI) has significantly and consistently grown.  

According to the United Nations Conference on Trade and Development (UNCTAD) World Investment Report 2020, FDI flows to Uganda more than doubled from 605 million dollars in the period 2005-2007 to 1.3 billion dollars in financial year 2018/19. Uganda ranks a close second to Kenya in FDI attraction in the East African Community.

Statistical data indicates that UIA has attracted planned FDI valued at 14.4 billion dollars- a rough estimate of the projected value of investments in the oil and gas sector alone. 

With expansion of the Authority’s mandate under the Investment Code Act, 2019 to promote domestic investments, indigenous Ugandan investment is now a significant source of investment capital doubling planned investments from 4.7 billion dollars in 2009 to 10.4 billion dollars in 2019 registering 121% growth.

Investment Promotion

UIA has a robust investment promotion and business development program through which it constantly and protractedly promotes Uganda as the preferred destination for investments – both domestic and foreign in Africa. 

Promotion takes the form of credible information sharing, promotions, inward and outward missions, use of Uganda Missions in target investment markets, policy advocacy, investment advisory services, investor targeting etc.

Business development literally walks with the investment projects to ensure a smooth and delay free investment journey. The provision of aftercare services includes engaging and maintaining contact with existing investors, understanding their needs and concerns, informing them about government programmes, helping them to cope with challenges and supporting their ongoing investments or operations.

Since UIA’s very first investment project, Mukwano Industries, was licensed in 1991, since then over 7,700 projects have been licensed. The bulk of the 4,200-plus industries/factories that are operational have been licensed by UIA, underlining the Authority’s impressive contribution to Uganda’s industrialisation and economic growth.

Industrial Parks Development

UIA has been mandated to develop 23 Industrial and Business Parks, well as four Regional Science, Technology and Innovation Parks (STIPs) in order to ease accessibility of land for investments, add value to locally produced raw materials, create jobs, introduce new research, knowledge, skills and technologies, and ultimately reduce imports, increase exports and boost Uganda’s revenue base. 

The Authority has already established nine Public Industrial Parks across the country in Namanve, Bweyogerere, Luzira, Kasese, Mbarara, Jinja, Mbale and Soroti. Of the 370 operational industries in the Industrial parks, 246 (60 percent) were by domestic investors, while 124 industries were foreign-owned. 

Sixteen Industrial Parks are planned for in Arua, Gulu, Lira, Hoima, Buliisa, Luwero, Mityana, Mubende, Masaka, Kabale, Kabarole, Tororo, Iganga, Bushenyi, Yumbe and Koboko. Four Science, Technology and Innovation parks (STIPs) are planned for Pakwach, Kyankwanzi, Rubirizi and Kamuli.

In addition, UIA supports five operational Private Industrial Parks in Kapeeka, Lugazi, Buikwe and Mukono, and is supporting the setup of many others across Uganda.

A different set of five Industrial Parks will be built under the Forum for China Africa Cooperation (FOCAC) arrangement, bringing the total number of planned industrial parks to 31.

A massive infrastructure development in our flagship park, Kampala Industrial and Business Park (KIBP), is now underway. Key infrastructure to be developed include a network of tarmac roads, bridges, traffic management systems and solar lighting, water distribution network including a reservoir, sewerage network, waste treatment system including for solid waste. 

Others are power supply systems (grid power and solar), fibre optic network, a close circuit television network, workspaces for small and medium enterprises, and fire-fighting systems.

Creation of jobs

Cumulatively, the Public and Private Industrial Parks have 44,488 direct jobs and 131,700 indirect jobs.

The nine operational Public Industrial Parks now provide 37,345 direct jobs (and growing) for Ugandans – from low skills to high skills – and 101,700 indirect jobs. In Namanve alone, the 71 industries now operating as well as the 146 under construction provide 32,000 direct jobs and 90,000 indirect jobs.

The four Private Industrial Parks in in Kapeeka, Lugazi, Buikwe and Mukono collectively provide 7,143 direct jobs and 30,000 indirect jobs.

In general terms, UIA-licensed investment projects in the Industrial Parks and outside have created over one million jobs of formal employment. These span sectors like manufacturing, agriculture and agro-processing, tourism, mining and mineral beneficiation, services, etc. 

UIA’s Strategic Plan 2020 – 2025 focuses on accelerated industrialization through industrial parks development. Through it, UIA targets to create 700,000 jobs in the next five years.

This is in line with the Uganda Vision 2040 and the NDP III (2021-2025) which emphasize industrialization as the key pillar to employment creation and achieving middle income status. 

Ultimately, UIA is using Industrial Parks development as a means of accelerating Uganda’s industrialisation and transforming the country as a regional industrial powerhouse churning out high value products.

A number of Regional Industrial and business parks are being developed for strategic sectors like Agro-processing, ICT, Mineral processing and logistics with the aim of providing high employment opportunities to the locals and creating strong backward and forward linkages, especially in Agriculture and Mineral sectors.

One Stop Business Centre for Investors

UIA is a One-Stop Business Centre for Investors. The Centre was established to make it easy for both local and foreign investors and entrepreneurs to easily register, start and operate a business in Uganda.

The OSC currently hosts 16 Government Agencies and private sector players in its physical space who provide services which include investment licensing, investment advisory services, company registration and intellectual property advisory services, citizenship and immigration control services, tax registration and compliance advisory services, environmental impact assessment certificate, application and issuance of trading license and application for building permits.

Others services include banking services and online payments, distinctive mark application and purchase of standards, free zone advisory services, services of utility companies, land title verification services, tourism and Investment advisory services and services to promote employer-employee relations.

The advantages of coming to the OSC are numerous and include, amongst others, access to advisors who can answer any questions that you might have, paper work processing and saving on the time and money you would have spent traveling between offices. 

The OSC has a very strict Client Service Charter that dictates the time within which each agency must respond to an inquiry from an investor. For example, investment and advisory services are readily available and will cost nothing for you to access; you can reserve a business or company name within an hour or even get a City Operator Identification Number within an hour; it will take you 15 minutes to make a cash deposit or get a duplicate bank statement. 

The 16 Agencies at One Stop Business Centre for investors are UIA, Uganda Revenue Authority (URA), Uganda Registration Services Bureau (URSB). Uganda National Bureau of Standards (UNBS) , National Environment Management Authority (NEMA), power utility UMEME, National Water and Sewerage Cooperation (NWSC), the Directorate of Citizenship and Immigration Control, Ministry of Lands, Housing and Urban Development, Diamond Trust Bank (DTB), Kampala Capital City Authority (KCCA), Uganda Free Zones Authority, National Information Technology Authority, Uganda (NITA-U), the Giants Club Conservation and Tourism Investment Initiative,  Federation of Uganda Employers (FUE). 

UIA generally, and the OSC in particular, has been automating and looking ahead. Today, if you cannot walk into the physical OSC, UIA has collaborated with NITA-U to provide access to these services online at www.ebiz.go.ug The digitally enhanced award-winning eBiz platform has a standby support team, including a 24/7 call centre ready to offer user-friendly and faster services to the business community. This has reduced the number of bureaucratic procedures, time and cost of obtaining the relevant licenses and permits in Uganda.

In Financial Year 2019/20, despite the impacts of Covid-19, the OSC hit 82,000 unique transactions, nearly tripling the target of 30,000 transactions. Prior innovations in automation also mitigated the adverse effects of the pandemic on business processes and continuity.

Micro, Small and Medium business development

SMEs are the driving engine of our economy, employing 90% of the total informal sector and contributing 25% of our GDP. Most of these are micro enterprises, aged between 1 to 10 years. The long-term survival and sustainability of Small and Medium Enterprises (SMEs), which

play a critical role in the development of the economy, is a going concern for the Authority. 

The Authority therefore supports and promotes thousands of MSMEs through entrepreneurship training programmes, hands-on technical skill training for value addition, cluster development and business linkages, youth and women apprenticeship programmes, creation of District Investment Committees, and MSME profiling and database development, amongst others.

The Authority is currently developing a National SME Portal through which MSMEs will be linked to markets, financing, innovators, policymakers, etc. The Portal will hold geo-tagged profiles of the MSMEs and allow them access to various Business Development Services provided by Government of Uganda and other SME promoters within the SME eco-system. It will offer a platform for collaboration amongst various stakeholders including, but not limited to: MDAs, development partners, Private Sector, Associations and NGOs. It will also allow for ongoing developments in the SME landscape to be easily monitored and their impact assessed.

Contribution to the Economy

As an entity, UIA’s FDI contribution to GDP is estimated at 2.3 percent of the National FDI contribution of 3.68 percent. UIA aims to increase its FDI contribution to three percent of the National FDI contribution target of five percent from 2020/21 to 2024/25.

Thanks to efforts by UIA and other players, Uganda’s manufacturing sub-sector has grown in the last decade, employing seven percent of the labour force and contributing 21 percent of Gross Domestic Product (GDP), according to the Budget Framework Paper FY2019/20.

A number of top taxpayers in Uganda now operate in the Industrial Parks: Century Bottling Company (Coca-Cola), Hima Cement, DFCU Bank, Leaf Tobacco and Commodities, Toyota Uganda and Roofings Limited, Kyagulanyi Coffee and Kawacom.

Others are Sadolin Paints, Roofings Rolling Mills, Uganda Electricity Distribution Company, Bollore Africa, Harris International Limited, Mukwano Industries, Steel and Tube Industries, Cipla Quality Chemicals, Sany and Graphic Systems, amongst others.

With many imported products now being manufactured locally, UIA is making significant contribution to import substitution leading to reduced import bill, export promotion, increased revenues, more jobs and incomes, increased aggregate demand and boost in economic activity, ultimately leading to economic growth and development of Uganda.

Uganda Investment Authority is an invaluable entity that will continue to play a pivotal role in Uganda’s quest for industrialisation and attaining Middle Income status.

Lawrence Byensi

Ag. Director General

Uganda Investment Authority 

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