Uganda spent Shs2 trillion on motor vehicle imports in 2019

Monday May 25 2020

Relying on imports: There have been attempts to

Relying on imports: There have been attempts to make motor vehicles locally but the country continues to heavily rely on imports. FILE PHOTO  

By Dorothy Nakaweesi

In 2019 alone, Uganda spent about Shs2 trillion on importation of motor vehicles, data from Ministry of Finance, indicates.

The Shs2 trillion was part of the Shs28.5 trillion that was spent on at least 1,500 categories of imports in the period ended December 2019.

During the period, the report indicates, passenger vehicles took the largest share of the motor vehicle import bill costing the country $182.4m (Shs693b).
This was followed by vehicles that carry goods with $132m (Shs501b).

In the same category motorcycle imports are captured with the country spending $75.5m (Shs286b).

Other notable imports under this category, the report notes, included tractors, public transport vehicles, which cost Uganda $40m (Shs152b) and $27m (Shs102b), respectively.

Special purpose vehicles such as cranes, fire-fighting trucks, trailers and semi-trailer and bicycles were the other imports in this category.

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Uganda is a net importer with much of the country’s motor imports sourced from Japan, India, South Africa, UK and Germany.

Records from Uganda Revenue Authority indicate that in the period a total of 42,681 motor units were cleared to enter the country.

However, this was a drop from the 48,966 units that had been cleared in the same period in 2018.
Recently, the URA former customs commissioner, Dickson Kateshumbwa, said there had been a decline in the motor vehicle imports due to the ban on cars older than 15 years.

In June 2018, Parliament passed a law that banned importation of cars manufactured earlier than 2003 due to increase in emission of toxic fumes and environmental damage.

Uganda, through Kiira Motor Corporation, has been attempting to manufacture motor vehicles locally. However, the corporation is yet to build sufficient capacity for mass production.

Government has been putting in place measures such as channels that seek to shift to import substitution.
However, this has not been successful over the years as the country continues to record growth in imports.

The outbreak of Covid-19 has created an urgent desire to improve local capacity in order to drive import substitution.

Local production

Attempts are being made to start producing vehicles locally through the Kiira Vehicle Assembling Plant in Kagogwa village, Kakira Town Council in Jinja District.

Construction works kicked off last year with contractors’ earth moving to prepare ground for laying of the sub-base, concrete slab and primary beams.

Equipment such as excavators, backhoe loaders, bulldozers and motor graders are already working on the site, covering 182 acres in the Jinja Industrial and Business Park.

A 33kv electric line over a distance of 3.7 km with initial half megawatts substation, which will expand to 14, have been installed.

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