Uganda pushes for import substitution to fast track industrialization

Uganda is pushing for a reduction of imports into the country in a bid to create a stronger economy, protect local industries and increase job creation opportunities.

Yoweri Museveni
Yoweri Museveni

The country’s President Yoweri Museveni, while speaking at the reading of the National Budget for the next financial year 2016/17 on Wednesday, said government has created a base for the country to graduate from being a ‘supermarket’ of foreign products to being a manufacturer.

Yoweri Museveni
Yoweri Museveni
He said government will ban the importation of second hand products, create conducive environment for investors, lower transport and electricity costs to boost local production in order to reduce imports and increase exports.

He said policy changes must be triggered, otherwise the country will continued to be flooded with imported goods to the detriment of local manufacturers and job opportunities.

Government argues that if all the textiles that are used in Uganda are locally made, the country will save 888 million dollars annually and create about 45,000 direct manufacturing jobs.

He said the key bottlenecks to fast track industrialization like transport and energy infrastructure are being addressed.

On top of the current 850MW of electricity being generated, Uganda, according to government figures is in the process of adding an extra 1,000 MW in the next five years. The country is currently constructing two hydro power dams with funding from China.

Museveni said besides providing adequate electricity, government is in the process of bringing down the high prices of power in a bid to reduce the costs of production. Government is targeting to bring down the cost to at least 5 U.S. cents

Another key element in fast tracking industrialization is a proper transport infrastructure. Government figures show that the country now has 5200km of paved roads compared to the 1,200km in 1986.

The country, with funding from China, is in the process of constructing a Standard Gauge Railway that will link it to the Kenyan seaport of Mombasa. The railway line, once complete will also link Uganda to neighboring Democratic Republic of Congo, Rwanda and South Sudan.

“With this better base of electricity and the improved roads, we are now, for the first time, in a position to decisively tackle the hemorrhage by attracting and incentivizing investors that will save the huge money in dollars,” Museveni said in the address that was televised countrywide. Enditem


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