Wake-up call to U.S. investors –you could be missing out

OPPORTUNITIES KNOCK WITH POLITICAL STABILITY, FREE-MARKET POLICIES AND A GOVERNMENT THAT IS MAKING IT EASIER FOR FOREIGN FIRMS TO DO BUSINESS, NOW IS THE TIME TO TAKE A FRESH LOOK AT UGANDA

NEW OPENINGS Non-traditional areas that the government would like to see developed in Uganda include financial services and ICT (see article below)

FOREIGN DIRECT investment into Uganda has been growing steadily over the last ten years as macroeconomic stability has become firmly established and news of the country’s business-friendly environment has spread.
Uganda still receives the largest amount of its FDI from the UK, its former colonial ruler and the destination of many of the Ugandan Asians who fled Idi Amin’s regime. Canada is in second place, with the involvement of large investors like Kasese Cobalt, and there is increasing investment from South Africa and Kenya.
Figures from the Ministry of Finance, Planning and Economic Development show that annual FDI more than doubled between 1995 and 1999, from $113 million to $248 million.

American interest in Uganda –and in Africa generally outside the energy sector–has been limited, however. The U.S. currently ranks fifth among investors in Uganda, and that is mainly attributable to a single mega-investment, the $550 million Bujagali power project.

“The Americans haven’t really come out to invest in Africa,” says Maggie Kigozi, Executive Director of Uganda Investment Authority (UIA), established by the government to promote and facilitate investment. “But there are a lot of opportunities here and other countries are taking them.”
Multinationals that have already come to Uganda include Coca-Cola, Pepsi Cola, South African Breweries, Shell, BAT Industries and Unilever. Those U.S. firms that have shown interest, says Dr. Kigozi, have had the vision to see the potential of the country. “We have companies like Coca-Cola, for example, who have invested here because they know what is coming. They have invested on a large scale in Uganda even though the market is not yet ready for their capacity, because they can see the future.”

Uganda boasts political stability and free-market policies endorsed by the World Bank and the International Monetary Fund (IMF). The government allows 100 percent foreign ownership of investments and business taxes have been significantly reduced. The rate of corporation tax–at 30 percent–is among the lowest in Africa.
As of June this year, 110 state enterprises have been privatized, leaving a further 40 to be divested. Coming up, or already in progress, are the concessioning of Uganda Electricity Generation Company and of the rail operations of Uganda Railways Corporation to private companies, and privatization of the water systems in 33 large towns.
The UIA acts as a one-stop facilitator for investors. “We hope any investor who comes here will come to see us,” says Dr. Kigozi. “The economy is growing, we have peace and security and the quality of life is good. What I say to American investors is that there are opportunities here and they shouldn’t miss out.”