Uganda


 

Geography and Population

Uganda is a landlocked country with a total area of 241.559 km2. It is in the eastern part of Africa, bordered by Kenya to the east, Democratic Republic of Congo to the west, and South Sudan to the North and Tanzania to the South alongside Lake Victoria, the world’s second largest lake. This lake is shared by three countries: Uganda, Kenya and Tanzania.

Uganda gained full independence from the British in October 1962. The population of Uganda is approximately 44 million people. Uganda is a multi-ethnic country. The four main ethnic groups are the Ganda, Nkole, Soga and Kiga tribes. The main religion is Christianity, followed by Islam.

According to the Uganda constitution, the country is a presidential republic. The parliament of Uganda is unicameral, with 238 constituency representatives. The power of the executive branch is vested in the President of Uganda, who is the head of both the government and the state. The president also serves as commander in chief of the armed forces.

Economic Overview

Uganda has a Gross Domestic Product (GDP) worth approximately 27 billion dollars. GDP is expected to increase at a rate greater than 6% in 2019.

Main Employment Sectors

Agriculture: Agriculture is the most important sector of the economy and has always been a strategic sector in Uganda’s economy. It represents approximately 25% of GDP and constitutes 90% of total export earnings and 73% of employment. The major export crop is coffee, but tea, tobacco and cotton are also important. The sector is also a major source of raw materials for industry.

According to the Uganda Investment Authority, investment opportunities in agriculture exist in commercial farming in both crops and animal industries as well as aquaculture, value additions (fertilizers, pesticides, cold storage facilities and logistics, farm machinery manufacturing and assembly, packaging and irrigation schemes).

The service sector in Uganda includes government activities, tourism, communication, transportation and finance. This sector represents half of the country’s GDP, nearly 52%, and is expected to grow at a rate of 8.6% in 2018.

Tourism: The government has identified tourism as a growing sector in the Ugandan economy. Approximately 26.4% of the country’s land area is located in protected areas, such as national parks, species management areas, game reserves, wilderness areas, marine reserves and Ramsar sites.

Tourism accounts for approximately 9% of GDP and employs approximately 8% of the total workforce. The government has developed a 10-year tourism master plan and a five-year sector development plan to guide the implementation of critical activities to drive the growth of tourism.

Infrastructural development continues to be a national developmental priority, as indicated by the Ugandan government, because of its multiplier effect in stimulating the country’s growth and development.

Given the 10% per annum growth rate in car ownership, the Ugandan government has embarked on an initiative to upgrade major standard roads and construct key bridges that would facilitate access and would further support the overall economic growth of the country.

According to the Business Monetary Index (BMI), 97% of heavy cargo transport relies on a poor quality road network, which is an economic hindrance. In the railway sector, the Ugandan government, in collaboration with partners within the East African region, is undertaking efforts to revitalize the railway transport system and will construct a fast track Standard Gauge Railway (SGR) throughout Uganda.

The SGR aims to connect the country with its East African neighbours, such as Rwanda, Kenya, the Democratic Republic of Congo and South Sudan. Ninety percent of the project will be funded by the Export-Import Bank of China, with the 3.2-billion dollar construction to be undertaken by the China Harbour Engineering Company.

The annual growth rate of the telecommunications sector is 10%. The following mobile companies operate in Uganda: MTN, Airtel, Uganda Telecom, Africell, Vodafone, Smile Telecom, Smart Telecom; Sure Telecom, and K2 Telecom.  Mobile phone companies now provide coverage for urban and most rural areas, though reception can be erratic.  

Mobile operators have installed 4G networks around Kampala, while 3G networks are available in secondary urban areas around Uganda. Ugandan businesses, particularly in urban areas, communicate frequently by email, and usage is increasing as connectivity improves.  Several internet companies also provide services to commercial entities and residences.

Industry accounts for 23% of Uganda’s GDP and employs approximately 7% of the labour force. Manufacturing allows the country to reap greater benefits from agricultural production. The agri-food sector processes coffee, tea, nuts, dairy products, fruit and vegetables, canned animal products and forage production.

In addition, the textile industry focuses on the production of fertilizers and the processing of skins into leather, silk and cotton textile. However, the textile sector of Uganda is negligible compared to that of regional giants (Kenya and  Ethiopia), and only 5% of the cotton produced in Uganda is subsequently used by local factories. Plastic products and metals are manufactured on a smaller scale.