PEACE AND SECURITY: Amelia Kyambadde says these two factors are a basic for a conducive investment environment because business owners are assured of lower costs and sustainability.

Could you please comment on the cost of doing business in Uganda given the government’s efforts to reduce them.
The cost of doing business, when you compare Uganda to some other countries in the region, you find that in some areas it is high, especially transportation from the coast, because of being a landlocked country.
As far as labour is concerned, we have cheap labour. Another advantage is that; we have policies and a clear regulatory framework that we have worked on for the past 15  years which are conducive for business.
Then of course we have peace and security. Peace and security is key. This makes the costs of doing business lower while at the same time secure and sustainable.
Allow me to talk about the laws and policies first, because that has been our success story. It has enabled us to create a conducive environment for investment.
We have a Trade Policy, Industrial Policy, a National Competition and Consumer Protection Policy, and a  National Grains Trade Policy. We also have ‘Buy Uganda, Build Uganda’ to promote our local products and a National Accreditation Policy.
There is also the Micro Small and Medium Enterprise (MSMEs) Policy, because as you know, most African economies are premised on MSMEs. At the same time, Africa’s challenge is managing them because they are fragmented.
Some of the MSMEs are unknown, some are operating incognito, because they are running away from taxes. We have embarked on carrying out an inventory on all the MSEMEs and the sectors they subscribe too, foods and beverages, construction and so on. This will help us formalize or streamline the MSEMEs.
Standards are key; we have a National Standards Quality Policy and many other policies are being developed. This has been our strength in reducing the costs of doing business.
Regional integration through the East African Community is another platform that has helped in reducing the cost of doing business.
We have a Common Market Protocol whereby we sell our goods to one another duty-free/tariff free and there is free movement of labour, goods and services.
The government through my Ministry is negotiating market access with other countries.
At the sametime, energy production is being worked on through another ministry that we have synergies with. Infrastructure development is key;  we are now working on the roads and the railway.
We are also introducing marine services to transport goods.
These are some of the issues we are working on to reduce on the cost of doing business.
 
How will ‘Buy Uganda, Build Uganda’ help since it is not the first time we have tried it?
‘Buy Uganda, Build Uganda’ is a policy that we introduced to be able to encourage people to buy our local products.
There is this phenomenon that only goods bought from the United Kingdom or abroad are the best. But now we are trying to sensitize Ugandans.to change their mindsets to support their local industries.
The Buy Uganda, Build Uganda policy implementation has been a challenge, but we have started with government institutions.
For example, as far as the textiles industry is concerned, the government has instructed all Ugandan security organisations to buy their uniforms from local textile factories within Uganda.
As we speak, implemention of this is taking place among security agencies like the police, prisons, army and the health service sector.
We are also imposing an excise duty on imports of second hand clothes to reduce their circulation, and to stimulate the construction of local textiles mills.
We are empowering cooperatives to grow more cotton to support the industry. The Ministry discourages export of hides and skins, inorder to promote the leather industry.
These are the key industries we are trying to promote. Therefore, we have to sensitize our neighbouring countries on some of these issues.
For example, we have a big pharmaceuticals company called Cipla Quality Chemicals.
Unfortunately our neighbours still import their anti-malarial drugs from other countries outside the region.
We have engaged our local supermarket proprietors to buy eggs, tomatoes and so on from our farmers. Today when you walk into a supermarket, Ugandan products on the shelves have gone up from 15% to 40%. I cannot say Ugandan products only but actually East African products. It is better to have East African products on our shelves  than for instance South African porridge or Italian spaghetti.
We also want our neighbours to reciprocate . We have Kenyan products like OMO (washing detergent) , but we need to balance this with our own products in Kenya.
 
What is the latest on the Uganda Export Promotion Board?
The Uganda Export Promotion Board has had challenges, but we have restructured it and got a new Executive Director, Mr. Elly Twineyo Kamugisha, and a new Board approved by the government.
The former Board expired about one and half years ago and that had been a setback in the management of the UEPB.
We are trying to revitalize it, It has had problems, but in a few months I will be able to give a brighter idea of what to expect.
What is the progress of the export processing zones?
I am not fully satisfied. The pace is too slow. We have to move faster. There is only Kaweweta livestock industry with the Turkish investors on
the ground. Fortunately, the law is there, and the Authority is in place, but we need to move faster on this.
 
You said earlier standards are key; how so?
We have revamped Uganda National Bureau of Standards (UNBS). It used to be totally dysfunctional, but we have restructured it with new administrative structures and offices.  We have reorganised the human resource, but the challenge is, we only have regional offices controling standards, especialy of agricultural produce.
We initiated the National Commodity Exchange so that we can have warehouses for agriculture produce.  We already have a number of warehouses about 38 now, but we need to have more so that we can control the quality and quantity of products like cereals, coffee and others. We want these to be traded through the commodity exchange and it will be easier to control the quality. We also need human resource to man our porous borders to control the goods going out. At the same time this has to be controlled through production, at the post-harvest stage.
 
What about eliminating the remaining NTBs?
We agreed as the EAC on a number of issues, including reducing on weighbridges. There should be a weighbridge at the point of entry and exit.  There used to be about five on the highway. We agreed to remove the roadblocks. We  also agreed to have a single visa; even an East African passport in the region. We agreed to ease the immigration laws and regulations.
 
Any comments about AGOA?
I must admit AGOA has not performed very well for Uganda. There are complicated Rules of Origin. The current arrangement is that a value addition level of 35% must be attained on products whose inputs are imported from non-AGOA countries.
This threshold of 35% is very high for developing countries like Uganda. So this has to be simplified. Most African countries have not be able to factor in AGOA into their systems because you have to renegotiate it periodically.
Of late, they have started involving themselves in issues such as human rights, governance issues, labour issues—so you find that these are not trade related issues. For us, we have peace and security. We have democracy, but our interpretation of democracy does not affect our trade. If our trade is affected, then that should be a trade- related issue. Finally, they do not consider commodities that have a comparative advantage over others which is a setback. If I am growing coffee and I know my  sterength is in coffee, you say coffee is not on the list. We want you to bring leather goods, but I am not good at leather this becomes a challenge.

Source: Business Week

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