Ramathan Ggoobi Benard Musekese Wabukala and Joseph Ntayi

Economic Development and Industrial Policy in Uganda

Industrialisation is critical in the transformation of an economic structure to a modern industrial economy. This report examines the main threads of Uganda’s industrial policy and its implementation strategy by analysing existing industrial policy, its important elements, progress so far made, challenges to manufacturing and industrial policy implementation and concludes with recommendations for productive industrialisation in Uganda. Using a semi-structured guide, in-depth interviews were conducted at relevant Ministries, Departments and Agencies (MDAs), in addition to an extensive review of documentation on industrial policy in Uganda.

Findings reveal that Uganda has a weak National Industrial Policy (NIP). Although uncoordinated and non-coherent in terms of implementation, Uganda’s development strategy is well-developed as profiled in the National Development Plans (NDP I and NDP II) aimed at achieving the Uganda Vision 2040. In terms of achievements, about 30% of the NIP has been implemented, largely in policy formulation for sugar, textiles, iron ore and grains.

 

Results further reveal that the five lead constraints undermining manufacturing in Uganda are: limited finances; infrastructure bottlenecks, particularly low energy for production and bad roads; inadequate skills commensurate to the manufacturing needs; competition from low cost producer countries; and poor quality products. On policy implementation, the five prime challenges in Uganda are: corruption; poor management; non-coherence in policy implementation; inadequate funding; and political interference. It is recommended that Uganda urgently reviews both content and implementation of the industrial policy and consequently comes up with an industrialisation strategy. Industrial clustering; infrastructure development; harnessing technology, innovation, productivity; raising incentives for manufacturing; skills development; and access to finance could transform Uganda into a middle income economy.

Ggoobi, Ramathan; Wabukala, Benard Musekese; Ntayi, Joseph

Economic development and industrial policy in Uganda

Kampala, 2017

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