Strengthen manufacturing sector 

Katherine Nabuzale

There are many lessons we can learn from this Covid-19 pandemic but what is perceptible is, investing in a vibrant manufacturing sector. Industry helps to cushion the economy against economic turbulences, providing economic stability in the face of a crisis. Currently, tourism revenue has reduced, the entertainment sector is down and many small businesses have been forced to close. However, industries are working. The only challenge is the question of competitiveness, capacity and output. Despite the fact that the industrial sector is steadily growing, the country is still much dependent on imports.

 The growth of industry improves upgrading and diversification in the agricultural sector which in turn drives demand for higher value-added services. Additionally, industry supports agricultural modernisation by manufacturing products relevant to the sector like, tools and machines used in cultivation. Part of the reason why farming methods in Uganda are still a little crude is because most of the needed tools are imported making them expensive for farmers.

It isn’t enough simply to have factories and produce more goods, it’s important to know how to make the machinery that produces the goods. The real key to power is to make the means of production. For instance, China, is the producer of all, if not most of its needed machinery. While Uganda imports all its machinery, neglecting to invest in small fabricators such as, the ones found in Katwe. 

Services are dependent on manufactured goods. Services are mostly the act of using manufactured goods. It can be difficult to export the experience of using something. Retail and wholesale are the act of buying and selling manufactured goods. The same goes for health, it is the act of using medical equipment and drugs. Finance involves the redirection of surplus resources that the non-financial sector of the economy produces, which means that indirectly, even finance is dependent on manufacturing. 

Manufacturing creates a chain of jobs. Most jobs, directly or indirectly, depend on the manufacturing industry therefore, building the sector results into a chain of new jobs. Reports from the Economic Policy Institute state that, each manufacturing job supports almost three other jobs in the economy leading to long term economic growth. Just consider the explosion of the Internet and mobile phones, all made possible by a small subset of production machinery called semiconductor-making equipment (SME). Which itself is dependent on other forms of production machinery such as the machine tools that grind the lenses they use or the alloys of metal from the metal-making industries. The machine tool makes the metal components that not only go into other pieces of machinery like cars but are used to produce yet more machine tools. Such a chain of production is a strong catalyst of explosive economic growth as proven by power nations like china.

Narrowing the gap between what we sell and buy will make all the difference in achieving a middle income status for Uganda. Similarly, Buy Uganda, Build Uganda (BUBU) will only successfully take off with the achievement of a vibrant and well-rounded industrial sector that also makes its own industrial machinery. This ultimately, is the power needed for an integrated self-sustaining economy.

Ms Katherine Nabuzale is a researcher and social analyst.