Government of Uganda is committed to the Trade Development Agenda, notes Hon Kyambadde.

February 19, 2019

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Hon Amelia Kyambadde, the Minister of Trade, Industries and Cooperatives has noted the Government of Uganda is committed to the Trade Development Agenda and we look forward to positive collaboration with the Enhanced Integrated Framework (EIF) Secretariat to leverage resources for trade growth.

She said this while opening the EIF Regional Workshop currently underway at Golden Tulip Canaan Hotel. The workshop is attended by representatives from over 15 countries.

Here is her full speech:

It is my honour to host the Enhanced Integrated Framework (EIF) Regional Workshop for Anglophone speaking countries and I take this opportunity to welcome you all.

Uganda’s economy

Uganda is land-linked country with a GDP growth of 5.6%.

As one of the fastest growing economies in Africa, Uganda has a population of about 40 million people with a GDP of US$773 (in real terms).

Our economy majorly depends on the export of agricultural commodities although Services and industrial production has recently increased over the years.

During the Financial Year 2017/18, Uganda’s exports increased by 7.23%, to US$ 2.89 billion from the previous Financial Year 2016/17 of US$ 2.696 billion.

Imports also increased by 16.42%, to US$ 5.48 billion from the previous Financial Year 2016/17 of US$ 4.71 billion.

A number of interventions have been made to address the country’s widening trade deficit. The pursuit for regional integration, business reforms, infrastructure development and skilling our human resources.

Our membership to regional integration agenda comprises of the EAC, COMESA, TRIPARTITE and AfCFTA. It is in the EAC and COMESA regions where Uganda recorded a positive trade balance since 2007. Our trade balance was $383.9 million in 2007, rising to $615.7 million in 2016.

EIF Collaboration

EIF’s collaboration with Uganda dates back to 2005; under the revamped Integrated Framework Programme, where Uganda was supported to undertake the Diagnostic Trade Integration Study (DTIS) in 2005/06.

This study and the revised DTIS, identified both economy-wide and sector/commodity specific constraints to the growth of trade and proposed a priority action matrix addressing the constraints.

The Ministry of Trade, Industry and Cooperative has been coordinating other MDAs and Development Partners to address these constraints through aid for trade related initiatives like:

Trade Facilitation support:
The Ministry received support from (DFID) through TMEA, to implement a web based Non-Tariff Barrier Reporting System that eased reporting and resolution of NTBs among trade facilitating institutions.

This, in turn has reduced on the delays and costs of moving goods in and outside of Uganda across trading member states. By end of December, 2018, 86% of all reported NTBs reduced movement of goods from Mombasa to Kampala from 21 days in 2011 to 4 days in 2018.

With Support from United Kingdom Department for International Development (DFID) through Trademark East Africa, construction of three OSBPs was completed in Mutukula, Busia and Mirama Hills. All the border posts are operating under one stop control which means that a transporter or traveller clears only once, on one side of the border.

Electronic Single Window System (ESWS): The Ministry with support from UNCTAD and TMEA is implementing an electronic single Window programme. A trade facilitation initiative aimed at reducing the time it takes to clear goods. The system has cut clearance time for imports and exports by over 25%. This is programme is supported by UNCTAD and TMEA.

ETrade Portal: Government with support from United States Agency for International Development (USAID), UNCTAD and TMEA, lunched a one stop information portal for export, import and transit information in Uganda. Every interested party can freely access this information online.
The Government of Uganda is implementing the Phase II Regional Integration Implementation Programme (RIIP) supported by COMESA with funds from the European Union. The overall objective of the Project is to improve Uganda’s competitiveness in taping regional opportunities through increased regional trade and investments. With RIIP support, support to operationalization of five Border Export Zones and implementation of the simplified trade regime and training of Cross Border traders.

Legal frameworks: The Ministry of Trade, Industry and Cooperatives (MTIC) has undertaken regulatory and institutional reforms in addressing the DTIS Action Matrix:

The Ministry established an MSME Directorate to oversee the growth of MSME enterprises who account for 95% of the business establishments in Uganda, with a majority (57%) of these operating in the Trading sector.

MSMEs have been aided in value addition to enhance their export capacities and skills development. An SME Policy and strategy was developed to guide development of this sector.

The Government approved the National Export Development Strategy 2015/16-19/20 to address macro-economic challenges such as exchange volatility and rising inflation. The NEDS implementation is expected to reduce the trade deficit; increase Uganda’s export values and market share in key priority marketplaces.

The Ministry of Trade oversees the implementation of Buy Uganda Build Uganda Policy that was approved by cabinet in 2014. The Policy and its strategy /plan is aimed at boosting local production and consumption of goods and services through Government Procurement. Prior to the implementation of the BUBU Policy, Steel industries were operating at 51% of installed capacity but by the end of the last financial year their production capacity had reached 60%. The increase in production capacity resulted into increase in the number of employees by 1209 from 6044; savings of USD 22 million on importation of steel products and increase in tax revenue of UGX. 27.53 billion. The contribution to Gross Domestic Product (GDP) by the steel sector rose by UGX. 352 billion as a result of BUBU Policy implementation.

A National Policy on Services Trade was approved by Cabinet on 19th July, 2017. It is aimed at boosting domestic trade and export of services. The successful implementation of the policy is expected to contribute significantly towards incremental growth of export values by US$ 5000 million, annually over the next five years. So far growth has been realised in mostly the tourism, Transport and ICT sectors. The education and business services are expected to grow with improved skills and capacities of services suppliers.

Uganda Development Corporation; an agency set up with the primary objective of promoting and facilitating industrial development in Uganda. The UDC is guided by a 15-year strategic plan (2017/18 – 2032/33) that guides Government’s investment in priority sectors. In partnership with the private sector; UDC is running several investments in cement manufacturing, fruit processing, tea value addition and provision of infrastructure services.

Uganda Warehouse Receipt Systems Authority (UWRSA) was established by an Act of Parliament to regulate and promote the use of commodities as collateral against credit to producers and traders. The achievements made include: Support to infrastructure development, Inspections & Licensing of over 1,000 storage facilities and market information system.

Ladies and Gentlemen,

EIF has supported Uganda with both Tier 1 and Tier 2 Projects;

Tier 1 (TRACE) and (TRACE II) Impact

In 2007, the Trade Capacity Enhancement project (Tier 1) was formed to address the immediate bottlenecks towards the development of trade as identified in the DTIS.

The Key outcomes:

Trade was mainstreamed into the 5-year National Development Plan 1 & 11
Development of the National Trade Policy (2007/2008) and strategy.
In October 2010, the Second Trade Capacity Enhancement project commenced under which strong synergies were built among various stakeholders including Government, Local Governments, Development Partners especially UNDP, World Bank, European Union and Sweden on promoting competitiveness, standards, the legal regime for doing business, private sector development and investment promotion.

Tier 2 Project (DICOSS)

The District Commercial Services Support Project (DICOSS), was successfully implemented between 2012 and 2017.
25 districts were equipped and retooled to facilitate effective and efficient delivery of commercial services.
Trade Sector mainstreaming in District Local Governments Plans and budgets has been attained.
The Ministry of Public Service approved the proposal to delink the Commercial Department from Production at the Local Government. Hence forth, new staff have been recruited in the districts.
Sustainability Support Phase
The Ministry is currently implementing the Sustainability Support Project which seeks to consolidate the ownership of the trade agenda and ensure sustainability of the results achieved under Tier 1 and Tier 2 projects.

I am proud to inform you that following the successful implementation of the DICOSS project, the Government of Uganda has continued to support District Commercial Officers (DCOs) through the Commercial Services Conditional Grant to facilitate commercial extension services at the Local Governments.

In FY 2017/18, a total of UGX 2.3 billion was released as conditional non-wage grant to all districts. In the FY 2019/20, the Government has earmarked 1.2 Billion UGX as part of the development fund for facilitate the commercial offices countrywide.
The Sustainability Phase budget has continued to facilitate: Annual DCOs Networking Workshops; revitalising the Inter Institutional Trade Committee and support to bi-annual engagements; developing an Industrial and SME database; support on Trade Committee engagement and updating the DTIS Action Matrix and Aid for Trade Database.
Handicraft and Souvenirs Development Project

I extend my appreciation to the EIF for approving and subsequently funding the Handicrafts and Souvenir sector development project, worth USD1,500,000, which will be implemented by the Ministry of Tourism, Wildlife and Antiquities.

This project will no doubt improve the livelihoods of our people who are engaged in the sector, create employment (over 10,000 jobs for the people involved in the sector), and boost exports of our handicrafts. I pledge our support for successful implementation of the project.

Conclusion

In conclusion, Uganda having been a pioneer beneficiary of the Aid for Trade initiative under the EIF, has made tremendous strides in prioritising trade, improving the doing business environment, regulating trade, negotiating markets for merchandise trade and services.

The Government of Uganda is committed to the Trade Development Agenda and we look forward to positive collaboration with the Enhanced Integrated Framework Secretariat to leverage resources for trade growth.

We particularly look forward to the rolling out of the EIF Strategic Plan 2019-2022, under the theme: Forging new paths for the Least Developed Countries in Global and Regional trade; which will advance the commendable work that the EIF has so far done in LDCs across the globe.

I extend my appreciation to the Enhanced Integrated Framework Secretariat for the continued support extended to Uganda and to other LDCs to promote trade as an engine for growth, sustainable development and poverty reduction.

Our Country will continue the struggle to graduate to middle income status by 2020.

I urge you to explore the beauty and sceneries of Uganda. This is a country with the longest river in Africa and is food basket for East and Southern Africa.

I thank you for listening to me.

I now declare this workshop open and wish you fruitful deliberations.

FOR GOD AND MY COUNTRY