Uganda Must Improve Its Business Competitiveness – KACITA

A market in Down Town Kampala
A market in Down Town Kampala

City traders under their umbrella Kampala City Traders Association (KACITA) say Uganda needs to urgently review its strategies to attract more local and foreign investment.

The traders say Uganda continues to perform poorly as a business location.

In the 2013 Doing Business Report published by the World Economic Forum, Rwanda ranked best in the region at position 52 in the world. In East Africa Uganda came second at position 120 followed by Kenya at 121, while Tanzania and Burundi came last at 134 and 159 respectively.

Uganda dropped six places from 114 in the last review to 120. The report analyses the competitiveness of global economies and efforts by states to promote a conducive business environment.

Speaking to Redpepper online, KACITA Chairman Everest Kayondo said that the rankings are an indication that Uganda is far from being an attractive investment area. He adds that if local and international investors are to retain businesses in Uganda, there is need to improve the business environment.

The data used in the Doing Business Report is collected from analyzing investment procedures such as starting a business, dealing with construction permits, registering property, trading across borders and licensing.

Kayondo points out that for instance in the hospitality sector; an investor has to acquire more than three licences. He suggests that some trade licenses must be merged to reduce the burden on investors.

Reuben Wekuuta, a Trade Officer at the Ministry of Trade and Industry, maintains that such licenses facilitate businesses as required by domestic and international laws. He says the permits and procedures protect the interest of investors and do not necessarily translate into viable businesses.

The report showed improvements to the business environment in all five East African Community economies.

In an Interview with our Reporter, Sheila Mugyenzi, a Senior Investment executive at the Uganda Investment Authority (UIA), said sharing good business practices with other East African countries could bring Uganda closer to global top performers.

UIA acts as a one stop shop for all the investment procedures.  This means that investors can get all the services in one location thus setting up businesses in a shorter time. Mugyenzi explains some of the procedures needed to open up a business in Uganda.

In the EAC, all 5 economies implemented a combined nine regulatory reforms in 2011/12 financial year making it easier to do business. Four were carried out in Burundi, two in Rwanda and one in each of Kenya, Tanzania and Uganda. Burundi was among the world’s most active economies in implementing regulatory reforms in 2011/12.

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