Ugandan Economy Research Articles

Examination of Access to Credit and Performance of Small and Medium Enterprises in Bushenyi District, Uganda

The study examined access to credit and the performance of small and medium enterprises in Bushenyi District, Uganda. The study was guided by the following objectives: to examine the extent of access to credit and the performance of small and medium enterprises in Bushenyi District. SMEs have been seen as uncommon supporters of the Ugandan economy because they both organize and work for innovative considerations. In any case, their execution and development are regularly ruined by different challenges. For the methodology, surveys and interviews were utilized to gather essential information, whereas diaries, books, and the web were sources of auxiliary information. The information was secured over five years, extending from the year 2019 to 2024. The relapse show has an R of 0.724, which shows a solid positive relationship between the factors. The coefficient of assurance, R square, demonstrates how well the information fits within the measurable range and how effective the fit is in clarifying the variety of the information. In this study, 52.4% of the variance within the dependent variable is explained by the independent factors, supporting financial services that are more inclusive and sensitive to SMEs. The areas of the study were challenged by the barriers and constraints facing SMEs in accessing credit from credit facilities. It was also limited to accessing the respondents since they were located across the Bushenyi District. Through creating an empowering environment for SMEs, the bridge that exists between huge and small companies can be limited. This may also be accomplished through segmenting NSE for SMEs posting and defining the administrative system that's inviting SMEs

Tax on Tech Giants for Electronic Services

The Uganda Revenue Authority has started collecting VAT from non-resident companies providing electronic services to non-taxable persons in the Ugandan economy, effective 1 July 2022. This article highlights the measures Uganda is set to take in ensuring that there is effective control of base erosion and profit shifting by tech giants whose services are being enjoyed and utilized in Uganda.

Impediments to the Actualization of Legislation on Local Brew in Kenya: a Study within the Kenya-Uganda Border Community, Busia County

Despite the aggressive efforts by the legislators and the moralists to demonize local brew in Kenya, Chang’aa and busaa have withstood all the suppression and they remain the most preferred alcoholic drinks for rural and lower class citizens. This study made an inquiry into the challenges facing the implementation of local brew policies, with specific focus on the Alcoholic Drinks Control Act, 2010 and the County Alcoholic Drinks Control Act which is currently being adopted by the counties across Kenya. The study area was unique in the sense that it strategically links Kenya and Uganda and there are deep intricacies in relation to cross border relations. No such study has been conducted in a local community along the Kenya-Uganda border with a long history of local brewing in the western parts of Kenya. The study data was collected from 60 local brewers using questionnaires. Personal interviews were used in gathering data from key informants that included 10 police officers and 10 national administrators. The study found major pitfalls both in the design and implementation of the policies on local brew. The study revealed that the major policy implementation challenges are related to influence from traditions, skewed implementation and coordination measures, inadequate implementation resources, poor conduct of the implementing officers, poor court practices and increased smuggling of sub-standard brew from Uganda. The police are some of the beneficiaries of local brew illegalization efforts since they fleece money from the gullible local brewers. The study recommended that local brew should be legalized and standardized because the current prohibition efforts only benefit Ugandan economy and promote the growth of the black market at the Kenya-Uganda border. There is a need for more investment on the socioeconomic aspects of life that more often lure people to local brewing. The study findings challenge the government to consider meditating upon the realities on the ground before prohibiting local brew. Keywords: Actualization, Legislation, Policy, Public Participation DOI: 10.7176/JLPG/109-08 Publication date: May 31 st 2021

Evaluation of CHIRPS Satellite Gridded Dataset as an Alternative Rainfall Estimate for Localized Modelling over Uganda

The Ugandan economy is largely dependent on rural-based and rain-fed agriculture. This creates a critical need to understand the rainfall dynamics at the local scale. However, the country has a sternly sparse and unreliable rain gauge network. This research, therefore, sets out to evaluate the use of the CHIRPS satellite gridded dataset as an alternative rainfall estimate for local modelling of rainfall in Uganda. Complete, continuous and reliable in situ station observations for the period between 2012 and 2020 were used for the comparison with CHIRPS satellite data models in the same epoch. Rainfall values within the minimum 5 km and maximum 20 km radii from the in situ stations were extracted at a 5 km interval from the interpolated in situ station surface and the CHIRPS satellite data model for comparison. Results of the 5 km radius were adopted for the evaluation as it’s closer to the optimal rain gauge coverage of 25 km2. They show the R2 = 0.91, NSE = 0.88, PBias = -0.24 and RSR = 0.35. This attests that the CHIRPS satellite gridded datasets provide a good approximation and simulation of in situ station data with high collinearity and minimum deviation. This tallies with related studies in other regions that have found CHIRPS datasets superior to interpolation surfaces and sparse rain gauge data in the comprehensive estimation of rainfall. With a 0.05° * 0.05° (Latitude, longitude) spatial resolution, CHIRPS satellite gridded rainfall estimates are therefore able to provide a comprehensive rainfall estimation at a local scale. Essentially these results reward research science in regions like Uganda that have sparse rain gauges networks characterized by incomplete, inconsistent and unreliable data with an empirically researched alternative source of rainfall estimation data. It further provides a platform to scientifically interrogate the rainfall dynamics at a local scale in order to infuse local policy with evidence-based formulation and application.

Uganda

The Ugandan economy is being severely affected by the covid pandemic, although the number of confirmed cases has so far remained relatively low, at 79 on April 27. The economic impact of the pandemic started to be felt even before the first case was reported on March 21, through supply chain disruptions. The authorities’ policy response has been timely, scaling up health spending and putting in place bold measures to help contain and mitigate the spread of the disease. The pandemic is exacerbating the economic difficulties caused by heavy rains at the beginning of the year, and the locust infection in the northern part of the country—whose full impact is still unfolding. The pandemic and the related response are dampening revenue collection and putting pressure on the exchange rate and foreign exchange reserves.

Monetary policy, financial frictions and structural changes in Uganda: a Markov-switching DSGE approach

This paper considers the use of regime-switching dynamic stochastic general equilibrium models for monetary policy analysis and forecasting purposes. The objective is to determine whether or not the inclusion of these regime-switching features provide a more accurate description of the economy in a particular low income country. All of the models incorporate financial frictions that are introduced through the activities of heterogeneous agents in the household and several other features that are incorporated in most small open-economy models. Two variants of regime-switching models are considered: one includes switching in the monetary policy rule (only) and the other employs switching in both the monetary policy rule and the volatility of the shocks. The models are applied to the quarterly macroeconomic data for Uganda and most of the parameters are estimated with the aid of Bayesian techniques. The results of the extensive in- and out-of-sample evaluation suggest that the model parameters do not remain constant over the two regimes. In addition, the transition probabilities suggest that there are three distinct periods where the central bank response has been more aggressive. These periods relate to a change in policy framework and significant shocks that have affected the Ugandan economy. It is also noted that the forecasting performance of the regime-switching models are possibly superior to the model that excludes these features over certain horizons.

Technological Distribution in Uganda: Information and Communications Technology and the State in an Eastern African Nation

AbstractInformation and communications technologies (ICTs) include old technologies—such as the radio and the television—as well as newer technologies—such as the Internet and wireless telephony. This study considers the process that the government of Uganda has used to adopt and implement ICT policy. This study also considers the techniques which the government of Uganda has used to distribute ICTS in public locations such as government offices, schools, and hospitals. In particular, this study attempts to consider the political motivations for distribution. The Ugandan government's attempt to distribute this technology reflects strengths in the area of distribution of artefacts, particularly to rural areas. Information and communications technologies are an important part of the Ugandan economy. In addition, ICTs strengthen the ability of citizens to communicate with each other across regional and language borders through shared access points. Methodologically, this paper uses the case study method. Semi‐structured interviews were conducted with politicians, policy makers, civil society activists, citizens, academics, medical personnel, regional government officials, and business people. This paper argues that politicians use ICTs as a component of a basket of goods and services that they can distribute to witnessing publics. This paper argues that ICT should be viewed as a type of infrastructure, and that as a public good, it can be used as a “club” good or “pork.” Although several authors discuss the potential of ICTs as democratizing, this paper documents that the Ugandan government has employed ICTs in oppressive ways, including for the surveillance of opposition leaders, and for social control.

Uganda Foreign Policy Trends

The article explores the tendencies of foreign policy trends of Uganda after declaration of independence in 1962. Special attention is paid to the contemporary period that has begun since Y.K. Museveni came to power in 1986: the country has become a more active agent in the world and regional politics. Lately, Uganda has been under influence of “soft power” of the Chinese foreign policy as well as of the Indian one. Nowadays, those countries have quite noticeable positions in the Ugandan economy. The country’s elite considers that cooperation with them is more acceptable for Uganda than that with the Western countries since neither China nor India put any pre-conditions in regard to political or legal norms. Besides that, the article exposes the history of Ugandan-Soviet relations and characterizes the development of Ugandan-Russian links at present.

Understanding the Anti Money Laundering Act, 2013: Implications on the Work of Civil Society and Non Governmental Organizations

The charitable sector is a vital component of the Ugandan economy and of many national economies and social systems. It complements the activity of the governmental and business sectors in supplying a broad spectrum of public services and improving quality of life, and safeguarding fundamental rights such as freedom of expression and freedom of association. This indeed is the very foundation of the UDHR, the ICESR and the ICCPR, on which the entire charitable sector is based. NPOs can also play an important role in preventing the causes of radical ideology from taking root and are, therefore, potential allies in the fight against terrorism and other societal vices such as bad governance and the suppression of fundamental rights and freedoms. It is important therefore, to safeguard and maintain the practice of charitable giving and the strong and diversified community of institutions through which it operates. In particular, it is important that any regulations and actions in the fight against anti money laundering do not harm the legitimate activities of non-profit organizations. Non-profit organizations can take on a variety of forms, depending on the country and legal system. Within FATF members, law and practice recognizes associations, foundations, fund-raising committees, community service organizations, corporations of public interest, limited companies, and public benevolent institutions, all as legitimate forms of non-profit organizations, just to name a few. This paper discusses how the provisions of the new Anti Money Laundering Act in Uganda may affect the work of NGOs and how they ought to prepare for that impact. Admonishing compliance with the law, the paper cautions NGOs on governance challenges and possible disruptions with fundraising and other aspects of their work.

Prevalence and Risk Factors Associated with Hemoparasites in Cattle and Goats at the Edge of Kibale National Park, Western Uganda.

Livestock production is a major sector of the Ugandan economy. Ugandan ruminant livestock (principally cattle and goats) are susceptible to hemoparasites that can cause serious clinical disease and production losses. Kibale National Park, in western Uganda, is a protected forest ecosystem surrounded by small-scale farms where cattle and goats are raised. We conducted a cross-sectional study of cattle and goats in this area and diagnosed hemoparasite infections by microscopy. We collected data on animal characteristics and management practices to assess risk factors associated with infection. We studied 186 cattle and 317 goats from 20 villages, including 16 villages directly adjacent to Kibale and 4 villages ≥3 km from the park boundary. Hemoparasites detected in cattle and goats were of the genera Theileria, Anaplasma, and Trypanosoma with a prevalence of 15.1%, 1.6%, and 4.3% respectively in cattle, and 10%, 6.0%, and 0.0%, respectively in goats. Trypanosomes infected approximately 8% of cattle in villages bordering Kibale but were never detected in cattle in "control" villages ≥3 km from the park. Trypanosomes were approximately 7 times more likely to infect animals in households that did not provide veterinary care to their animals than in households that provided routine veterinary care. Within cattle, Theileria infections were approximately 7 times more likely to occur in cross-bred cattle than in indigenous pure breeds. Anaplasma infections were approximately 3.5 times more likely to occur in cattle than in goats (no goats were diagnosed with Trypanosoma infection). These data suggest that proximity to the park, provision of veterinary care, and breed are significant risk factors for hemoparasites in this population of ruminants, and that, in general, cattle are more susceptible than goats.

The future of financing for HIV services in Uganda and the wider sub-Saharan Africa region: should we ask patients to contribute to the cost of their care?

Whilst multi-lateral funding for HIV/AIDS dramatically increased from 2004 to 2008, it has largely plateaued in the last 8 years. Across sub-Saharan Africa, up to 20 % of total spending on health is used for HIV services, and of this over 85 % is estimated to come from international funding rather than in-country sources. In Uganda, the fiscal liability to maintain services for all those who are currently receiving it is estimated to be as much as 3 % of Gross Domestic Product (GDP). In order to meet the growing need of increased patient numbers and further ART coverage the projected costs of comprehensive HIV care and treatment services will increase substantially. Current access to HIV care includes free at point of delivery (provided by Ministry of Health clinics), as well as out-of-pocket financing and health insurance provided care at private for- and not for- profit facilities. The HIV response is funded through Ugandan Ministry of Health national budget allocations, as well as multilateral donations such as the President’s Emergency Plan for AIDS in Africa (PEPFAR) and Global Fund (GF) and other international funders. We are concerned that current funding mechanism for HIV programs in Uganda may be difficult to sustain and as service providers we are keen to explore ways in which provide lifelong HIV care to as many people living with HIV (PLHIV) as possible. Until such time as the Ugandan economy can support universal, state-supported, comprehensive healthcare, bridging alternatives must be considered. We suggest that offering patients with the sufficient means to assume some of the financial burden for their care in return for more convenient services could be one component of increasing coverage and sustaining services for those living with HIV.

Impact of EU agricultural policy on developing countries: A Uganda case study

Despite substantial reforms, the European Union (EU)'s Common Agricultural Policy (CAP) is still criticised for its detrimental effects on developing countries. This paper provides updated evidence on the impact of the CAP on one developing country, Uganda. It goes beyond estimating macrolevel economic effects by analysing the impacts on poverty. The policy simulation results show that eliminating EU agricultural support would have marginal but nonetheless positive impacts on the Ugandan economy and its poverty indicators. From the perspective of the EU's commitment to policy coherence for development, this supports the view that further reducing EU agricultural support would be positive for development.

Moving beyond the paradox of macroeconomic stability in Uganda?

This article explores macroeconomic policies in Uganda in the wake of the global financial crisis and following the publication of the 2010 National Development Plan. Despite apparent changes in rhetoric regarding macroeconomic policies by the Ugandan authorities, the paper demonstrates how the commitment to conservative monetary and fiscal policies prevails. The article analyses how the persistently conservative macroeconomic policy stance has exacerbated the lack of economic transformation in the Ugandan economy. The resultant outcome has been a failure to absorb the fast-growing Ugandan labour force into productive and gainful employment. The case is therefore made for an alternative macroeconomic framework that puts public investment at its centre and which complements macroeconomic policies with suitable sector-specific and industrial policies.

Using Kirznerian perspective of entrepreneurial opportunities to predict emergence of new ventures: a preliminary literature review

This preliminary theoretical paper seeks to set the stage for an empirical study to identify the critical determinants of new venture creation in Uganda using Kirznerian perspective of entrepreneurial opportunities framework. The lack of a developed theory in extant literature that provides comprehensive explanation of how new ventures emerge in the context of a developing country like Uganda justifies the reliance of Kirznerian analytical framework. The phenomenon of new venture emergence is important to the Ugandan economy as it provides young people with jobs necessary to avert the prevailing challenge of unemployment. A need for achievement plays a mediating role.

Where Are the Ugandan Youth? Socio-Economic Characteristics and Implications for Youth Employment in Uganda

This paper undertook a structural analysis of the youth labor force in Uganda by documenting their location in the Ugandan economy by residence, region, sector, and employment status. The data were obtained from the Uganda National Household Surveys 2002/03, 2005/06 and 2009/10. We find that the youth population structure of the country poses a big challenge in an effort to create employment, particular for the youth. The majority of the youth labor force is located in the rural compared to the urban areas of the country. Whereas we find quite impressive labor force participation rates and the employment population ratio, they do not necessarily reflect more and better employment opportunities because of the high degree of informality where most of the youth are underemployed. Over 90% of the youth were employed in the informal sector outside agriculture with slightly more female youth than their male counterparts. The quality of the youth labor in terms of education is improving though will lower attainment rates at postsecondary level, however, the quality of the youth labor force is higher in urban than in rural areas. An increase in self-employment is observed which is an indication of high rate of job creation is in the informal economy. Consequently, there is a limited participation of the youth in professional and technical occupations and in paid employment. By gender, it’s surprising to observe that there more female youth employed as professionals compared to their male counterparts. However, it is noteworthy that the percentage of both male and female youth employed as professionals is on average less than 1%. Connected to this is the finding that there is a higher proportion of the youth labor force employed in agriculture despite its dismal contribution to GDP. Whereas the country experienced sectoral shifts in GDP composition, with the services and manufacturing sector becoming more important than agriculture, there are no sectoral shifts in employment with agriculture remaining the main employer of the youth labor force. Very low youth unemployment rates are observed suggesting a significant time underemployment. Additionally, there is a significant proportion of the youth that are skill underemployed; their educational attainment was higher than the educational level required by their current main jobs. Youth unemployment problem is more of an urban phenomenon with a higher proportion of the youth unemployed in Kampala compared to other regions. Our findings suggest that increasing labor productivity in agricultural as well as in the non-agricultural informal sector where the majority of the youth are located might help to solve the youth unemployment and underemployment predicaments. There is also need to ensure access to cheap finance by the youth, practical education, secure premises for informal businesses, and design policies to slow down the current population growth rates.

China–Uganda and the question of mutual benefits

This paper investigates the benefits of Chinese companies to the Ugandan economy using data gathered during fieldwork in Kampala. Potential contributions to the Ugandan economy are analysed through a number of economic and managerial factors, and their determinants. This paper shows that potential benefits vary on the basis of sector, investment size and ECCO registration. The potential harm caused by one sector in particular is indicated. The paper presents recommendations regarding how potential benefits can be maximised and harm reduced. Given the increased presence of Chinese enterprises in Africa, these findings are relevant to African policymakers and academics.

Climate Change, Pastoral Livelihoods and Environmental Resource Conflict in Uganda

The Ugandan economy and the welfare of the population are intricately linked to the natural environment and, therefore, highly vulnerable to climate variability and change. This paper presents contemporary debates surrounding, climate change, pastoral livelihoods and environmental conflict in Uganda. My argument is that unless control measures are instituted and actualized to abate the dangers of climate change and environmental shocks, achieving sustainable development will remain a challenge and conflicts as a result of resource scarcity will persist in Uganda. Climate change is disproportionately acknowledged to affect developing states worst than their counter parts. This is becoming true of Uganda, a country with the majority of the population living in rural areas and totally dependent on natural resources and the environment.

PRS Review: Uganda Case Study

This largely desk-based report analyses the extent to which a selection of policies within Uganda’s Poverty Eradication Action Plan (PEAP). Uganda has been chosen as a country that fits into the category of countries that has a high proportion of chronically poor people within its population but which can be seen as a relatively good performer in terms of poverty reduction. In discussion with the CPR2 Team, the PEAP policies identified for analysis were the Plan for the Modernisation of Agriculture (PMA) and land reform policies with a specific focus on the implications for women. In terms of the CPR2 ‘Framework for Plausible Policies’, PMA can be characterised as a ‘growth-based’ strategy aimed at addressing the maintainers of poverty. Although the chronic poor do not form an explicit focus for the PMA, there was a perceived need for the PRS reviews to include a central focus on agricultural development policies. Moreover, the PMA is a centre-piece of the ruling regime’s long-term strategy of fostering pro-poor forms of structural change within Ugandan economy and society, and as such has a resonance with one of the central themes of CPR2. Our second policy focus, on land reform policies and their implications for women in particular, constitutes an effort to address issues of ‘Rights, Culture and Empowerment’, a policy area that in turn has close links to the CPR2 theme of securing social justice for the chronically poor. The 1998 Land Act can be seen as being more explicitly relevant to chronic poverty given that it was directly concerned with tenure security for women and orphans, and with issues of gender equity more broadly.This first draft of the Uganda PRS Review is based substantially on documentary-based research and also some interviews with key civil servants in Kampala over December 2006-January 2007. This research process has not been without its problems, including the difficulties in securing interviews with key informants over the festive season and in the run-up to the production of the latest Poverty Status Report. Moreover, the lack of progress in some elements of these policy areas, coupled with the absence of strong monitoring and evaluation systems has made it difficult to establish the causal impact that these policies may have had on chronic poverty.As such, however, both policies shed considerable light on the problems of implementation that surround PRS processes. As the report reveals, there are context specific reasons as to why implementation of these policy reforms has been problematic in Uganda, particularly in relation to certain institutional and political obstacles, and also a basic failure to sufficiently prioritise the issue of implementation within the PEAP process. However, the fact that implementation has proved to be a considerable difficulty in a country that is normally seen as one of the most successful examples of the PRS experiment should raise considerable concerns regarding the often exaggerated ambitions that have been placed on PRS processes.In particular, the Ugandan case suggests that the level of inter-sectoral co-ordination, administrative capacity, financial resources, and political will required to push through often controversial and wide-ranging policy reforms within PRSs should not be underestimated. Amongst the recommendations that we suggest might help to address these issues are: longer timeframes for PRSPs to enable a stronger focus on implementation; a greater clarity regarding sectoral responsibility and reduced ambitions for inter-sectoral co-ordination; and closer links to the budgetary process. Finally, we echo wider calls which suggest that donors should consider focusing their attention more on helping states to acquire the political capacities associated with developmental statism rather than insisting on the uptake of complex policy agendas.

Patterns of Agricultural Growth and Overall growth of Ugandan Economy

This study aimed at establishing simple stylized facts on relationships between the share of agriculture and its subsectors in GDP and GDP per capita in Uganda. The study utilized both trend and regression analysis tools to achieve the study objective. Previous studies give evidence on what has come to be a stylized fact , that the share of agriculture in GPD falls as the GDP per capita of an economy increases. Our findings by both the trend and regression analysis confirm this stylized fact. However, when agriculture is disaggregated, the pattern that emerges is not consistent with previous studies. Whereas, the overall agriculture and the subsectors of agriculture such as food crops, livestock and forestry share in GDP falls as GDP per capita rises the fishing sector share in GDP does not exhibit a significant relationship with per capita income. The findings also show that whereas the share of non-monetary agriculture, non-monetary food crops, non-and monetary livestock share in GDP exhibit a negative relationship with GDP per capita income, the share in GDP of monetary agriculture, monetary food crops, cash crops, monetary and non monetary forestry and fishing exhibit no significant relationship with GDP per capita. Key words: Performance, Ugandan economy GDP, per capita, agriculture sector.

Poverty Impacts of an Economic Partnership Agreement Between Uganda and the EU

This paper analyzes the poverty impacts of an economic partnership agreement (EPA) between Uganda and the EU. As Ugandan exports are also eligible for duty-free access to the EU under the Everything But Arms scheme the main impact of the EPA will be to require liberalization of EU exporters’ access to the Ugandan market. There are fears this could threaten the incomes of poor people through lower prices for agricultural commodities, the crowding out of vulnerable industries, and loss of government revenue. We examine these fears by means of a qualitative analysis using data from a 1999 social accounting matrix of the Ugandan economy and the 2002/2003 household budget survey. We then quantify the effects on the economy and poverty employing a combined CGE-microsimulation model. The qualitative analysis shows that the scope for trade liberalization with the EU is very limited and that particularly the poor have only weak links to formal markets. The quantitative analysis suggests that the macroeconomic impacts of an EPA are minor but positive, implying that the economic adjustment costs might turn out to be low. Whether the very small poverty effects are positive or not depends on the selection of sensitive products in the EPA, although under all scenarios the very poorest appear to lose.