Sectors expected to drive the economy

Friday June 14 2019

Major driver. Tourism will be a major driver of

Major driver. Tourism will be a major driver of growth in the 2019/20 financial year. PHOTOS BY EDGAR R BATTE  

By Christine Kasemiire, Dorothy Nakaweesi & Eronie Kamukama

Government has focused on some sectors to drive an industrialisation agenda in the country.
These are expected to drive industrialisation, a long-term desired anchor for government’s projected growth.
In fact, it has been engraved within the theme of the budget for three years as a mitigation for the increasingly growing unemployment.
Therefore, industrialisation has been government’s major anchor on which it hope to solve the unemployment conundrum.
However, other sectors such as infrastructure, security, Information and Communication technology (ICT) and tourism, will be key in propelling desired economic fortunes in the next financial year.
State Minister for Finance in charge of Planning David Bahati said in an interview: “We think we should complete the infrastructure that we have started in the Albertine to fast track the production of oil.”
Shs1.5 trillion, he said, has been allocated to finish that,” adding there will be continued investment in peace and security because: “Nothing can move ahead without security. We have an additional Shs1.5 trillion in the defence sector,” he said.
Bahati also noted that sectors involved in creating jobs such as including ICT have been allocated “enough” money to build on the good progress.

Budget allocations
To propel industrialisation, allocations have been enhanced through the Ministry of Works, Energy, ICT and Science and Technology Innovations.
Works has received Shs6.4 trillion up from Shs4.79 trillion in the 2018/19 financial year.
This will be buttressed by increased allocations in the energy sector, whose budget has been enhanced from Shs2.4 trillion to Shs2.9 trillion.
However, ICT while prioritised, has seen a drop from Shs149b to Shs146.2b in the 2019/20 finncial year. Science Technology and Innovation has also seen a slight cut to Shs158b from Shs1186b.
This is the case because Finance Minister Matia Kasaija believes that government cannot priotise all sectors at the same time given resource constraints.

Industrialisation
With only 80 factories in 1986, Uganda has grown to about 4,900 factories today. This has seen an increase in jobs to 1.1 million.
In his State of Nation Address last week, President Museveni, said governments envisages to add more jobs given a tranche of upcoming industrial parks across the country.
Mr Museveni also argues that a cut in the cost of power for large scale manufacturers from the current 8 cents per unit to 5 cents, will drive more production and in turn export promotion and competitive inland commodity prices.
However, even with a generation capacity of over 11,700 Megawatts, the electricity regulator believes massive power consumption will only be realised if tariffs are reduced to at least 5 cents.
Industrialisation must also be assisted in terms of creating export markets as well as building a well-connected road network to access raw materials.
Currently, Uganda’s tarmacked road network stands at 5,111km, way above the 5,000km.
Revival of Uganda Airlines and Uganda Railways Corporation as alternatives to road transport will also be a driver for the industrialisation agenda.
However, bottlenecks such as cost of money or high interest rates must be mitigated, especially through Uganda Development Bank, which will establish regional centres across the country.

ICTs
In addition to employing youth through innovation centres such Andela and Design Hub, ICT innovations such as Safeboda, Kikuubo Online, Jumia among others are formalising the informal sector, a cancer government has fought for years. In other words, they are helping where government failed to bring such informal sectors into the tax fold.
Mr Tonny Oyana, a principal at , College of Computing and Computer Sciences at Makerere University, says automation of some processes is vital to ease doing business.
“Some startups can really improve our systems whether it is agriculture, transport or tourism. But many of our systems are still manual. If automated, we can provide farmers with timely information so that they do their work,” he says.

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