First virtual UK-Uganda trade and investment Convention hailed a success
The 2020 UgandaUK virtual was an outstanding successful, Covid-19 pandemic did not deter the resilient and dedicated team of Ugandans in UK led by their chairman Willy Mutenza ran the event digitally via Zoom. “A great way to ignore the limitations of the pandemic and keep solving issues with new technologies” Martin Best, COO Wirex).
This year’s theme was “Uganda’s Untapped Investment Potential” and it fitted well with some of the core objectives which were:
Promoting and facilitating bilateral trade between the United Kingdom, Europe, the Diaspora and Uganda
Facilitating foreign direct investment in Uganda
Providing a platform for businesses to expand into new markets
Promoting British businesses exporting to Uganda
Encouraging and exposing business and investment opportunities to Ugandans living in the UK
In his remarks H.E Amb. Julius Peter Moto, Uganda’s High Commissioner said that under the leadership of H.E President Museveni, government of Uganda recently launched the Third National Development Plan (NDPIII) that aims at implementing the Uganda Vision 2040, it was approved by Cabinet in 2007, was conceptualized around strengthening the fundamentals of the economy to harness the abundant opportunities around the country,” he added.
He reminded the participants that the NDPIII has 5 objectives, namely:
Enhancing value addition in Key Growth Opportunities (Agriculture, Tourism, Minerals, Oil and Gas and Knowledge).
Strengthening the private sector to drive growth and create jobs,
Consolidating and increasing the Stock and Quality of Productive Infrastructure,
Increasing Productivity, Inclusiveness and Wellbeing of the Population,
Strengthening the role of the public sector in the growth and development process.
He added that, the convention addressed three focused sectors namely Real Estate, Agribusiness and Finance and Banking fits within the government of Uganda NDPIII objectives. These are critical sectors for economic growth and development.”
“Real estate caters for shelter which is a basic human need, as Agribusiness caters for food another basic human need. Financial institutions provide much needed services, including capital, which is a key enabler for all sectors.”
He emphasized that Uganda is open for business and all sectors are on the table of investments. These sectors are Oil and gas, Tourism, Minerals, ICT Business, knowledge base, Water Resources, Industrialisation and Agriculture.
According to Mr Moto, Uganda welcomes investors in these sectors, adding that this has been made possible by total peace and stability that Uganda has enjoyed for over 30 years, favorable investment laws & incentives, a large population in east, southern and central Africa averaging 300 million consumers, a highly trainable manpower base, and improvements of infrastructures that facilitate businesses.
“There are strategic landmarks and outputs that were achieved under the NDP1 & NDP II that need to be consolidated with lessons learned along the path of projects implementations, all aimed at making the ease of doing business in Uganda better,” he concluded.
Subhash, former President, London Chamber of Commerce said that despite of challenges uganda has had including the major of Idi Amin, has enjoyed peace and stability, and that is to be commended. And this has contributed to the stable growth for the last 20 years or so. And the growth of 6.5%, which makes it Uganda amongst the top 20 fastest growing economies of the world.
He added that the service sector in east Africa is growing at a rate of 7.6%. And this is a huge potential for Uganda considering the fact that Uganda has a human resource potential of 75% below the age of 30.
Nevertheless, he was disappointed by the growth of agriculture sector at only 3.8%. The overall national growth rate is around 6.5. But the agriculture sector is not growing at the same level and, and considering the natural resources that Uganda has got, we’ve got a really tremendous potential to take advantage of that and create an organised agriculture industry, he added.
He commended the legal system in Uganda as fairly stable, cited a case by Ruparelia vs Bank of Uganda as a classic example of the fact that the Justice exists in Uganda and this attracts international investment due to stability and good legal system. He finally, was pleased by the Ugandan government for welcoming international investors.
On the overview of The Property sector in Uganda Judy Rugasira Kyanda, Managing Director Knight Frank Uganda pointed out that in east Africa region Uganda has the highest return on investment in the real estate due to its resilience.
HRH Sylvia Nagginda, The Nnabagereka in her keynote remarks stressed that we are living in a very difficult times, Covid pandemic has disrupted the way we live and now we are all trying to adapt to the new normal. As most countries are easing down lock-downs, we, as leaders, it is our duty to encourage, inspire and request you to take personal precautions, as by now Covid-19 has got no proved vaccinations or cure. Thus, it is imperative that we still respect and adhere to given standard operations procedure’s (SOP).
The Queen cited the importance of Ugandans in the Diaspora’s contribution to Uganda’s economy. According to the World Bank 2018 Report on migration and remittances, Ugandans from the Diaspora globally remitted US$ 1.3 billion in 2018. The amounts translate to about 5% of Uganda’s GDP of US$ 27.9 billion. With the Covid-19 devastating economies where most of our Ugandans work abroad, the amount of remittance is likely to shrink. Despite the situation, she encouraged Ugandans and investors to look further at ventures that are more inclusive and that empower and includes women.
“Women started this crisis from a position of economic disadvantage, we’re worried the impact on women’s earnings and employment prospects will widen existing gender inequalities, not least the gender wage gap.” quoted Dr Sara Reis, the head of research and policy at the UK Women’s Budget Group.
Emerging evidence on the impact of COVID-19 suggests that women’s economic and productive lives will be affected disproportionately and differently from men. In Uganda, she said, most women work in the informal sector, earn less, save less, hold less secure jobs. And according to our cultural setup, they have less access to social protections. Their capacity to absorb economic shocks is therefore less than that of men. As women take on greater care demands at home, their jobs will also be disproportionately affected by cuts and lay-offs. Such impacts risk rolling back the already fragile gains made in female labour force participation, limiting women’s ability to support themselves and their families, especially for female-headed households.
Further the Queen said that, in Uganda, the first round of layoffs in the aftermath of Covid-19 has been particularly acute in the informal sector, services sector, retail, hospitality and tourism, where women are overrepresented.
The situation is worse in our country Uganda where the vast majority of women’s employment – is in the informal economy with few protections against dismissal or for paid sick leave and limited access to social protection. To earn a living woman often depend on public space and social interactions, which are now being restricted to contain the spread of the pandemic.
At the 5th UgandaUK Convention in London in 2015, HRH Sylvia Nagginda presented a paper on the role of Ugandan women in sustainable economic development and therein, and urged the Government and private investors to reward the resilience of Uganda’s women by putting women at the centre of policy and investment decision making. This plea is more urgent now than ever. In fairness, support measures in response to Covid 19 need to go beyond the formal sector to include the informal part-time and seasoned workers most of whom are women.
A good innovation is the connection of e-commerce platforms using mobile apps. Female market vendors in the informal food supply chain both in the rural and urban settings now over 60% of those who have signed up to use these platforms are women; young women and persons with disabilities.
E-commerce is a powerful way to drive growth boost trade and create jobs. However, many developing countries including Uganda are still lagging behind.
The start-up culture in Uganda is growing with many online businesses experiencing growth, a considerable number of these digital based businesses are run by women and according to disrupt Africa in 2019 investments in African tech start-ups rose to 61% totaling to about 492 million US dollars. The World bank reported that uganda had 16 tech hubs where entrepreneurs collaborated in 2018.
The third edition of the Mastercard index of women entrepreneurs ranked Uganda among the top three out of the 58 markets evaluated around the world. The majority of women owned enterprises in Uganda are concentrated in the trade sector; accommodation, rentals and food supply services. Many women successfully traded in the textiles and clothing industry by exporting the Kikoi a multi-purpose east African cloth to Ghana. The female share of all businesses is lowest in agribusiness; fishing, transport, storage and information and communication technology although non-traditional agriculture exports offer opportunities for Ugandan women farmers many are unable to exploit their full potential in this area. Women, are usually hesitant to borrow money from banks or microfinance institutions because of the long and technical process involved as well as lack of security. Investment from private entities of individuals would provide opportunity for a large number of women to access capital to enable women overcome the barriers that hold them back from being highly successful entrepreneurs.
She said, these include but not limited to investment capital to hard heat feminized sectors like the hospitality industry and leisure or tourism sector. Advice on growing and reaching new markets,
affirmative action in public procurement and women-owned businesses and support to more female entrepreneurs to transition to e-commerce platforms and opportunities for example in Agri-tech.
Now putting women and girls at the center of economic growth in Uganda has numerous advantages for example it would support a more rapid coveted 19 recovery; enable more inclusive delivery of the
sustainable development goals, empowers future generations and contributes to grassroots
economic growth because women invest their wealth whatever size it is in the health
and education of their families. Long-standing cultural institutions such as the kingdom of
uganda have continued to play a positive role in promoting women to achieve sustainable development in uganda through economic empowerment, using holistic approaches to empowering young women in leadership roles social skills and economic production. We culture institutions are contributing to the transformation that unleashes the presently constrained half of the population to production wealth and prosperity. There is need for more concerted effort in working with and for people, a value espoused by Obuntu bulamu in a flagship program initiative called Ekisaakaate Kya Nnabagereka by the Nnabagereka Development Foundation that the Queen founded in 2000.
Judy Rugasira Kyanda, Managing Director Knight Frank Uganda said that, real estate goes through cycles every 18 years. And the duration of the cycles varies from sector to sector, from your graphical location to geographical location, Uganda, fortunately, she added, has had a very resilient real estate sector. After the global financial crisis in 2008. The sector felt the after effects slightly later, in 2011. And unfortunately, that coincided with a general election then. And what happens in this part of the world is, whenever there’s a general election, that tends to sort of slow down the economy to a certain extent. And because real estate is one part of other sectors of the economy is also impacted as property investors usually put on hold investment, people become very cautious, market sentiment becomes equally cautious as well. And we see less activity as people wait and see what the outcome of the election is going to be. Fortunately, nothing drastic ever comes out of it. And we’re able to pick up and start all over again.
In East Africa, Uganda has got some of the highest returns, in the office, residential and retail sector. She added, Uganda has some of the highest yields and capital value appreciation in the region, which makes Uganda a very attractive destination for property investments.
Rentals have also been relatively good, stable, we are still achieving foreign currency, or dollar rise rentals, repatriation of funds is also something that is still accepted in in this region. So that works for the sector in general.
And obviously 2020 came in with the crisis. We have seen a slight recession over the last couple of years, and we’ve been coming out of recession, and slowly getting into recovery. And just as we thought we’re going to pick up ourselves in 2020. In came the crisis. And what we saw was an acceleration of the trends that have been happening in the property sector.
But real estate as a sector has been impacted just like any other sectors of the economy. And we have seen the trends that were happening previously being accelerated. And the impacts on the sector have been drastic for some assets classes. And some sectors have been hardest hit than others because obviously the impact hasn’t been felt the same way across sectors.
Finally, she said that the low to middle income residential sector particularly is still very attractive, with a shortage of housing, having a huge gap mainly in the affordable, low cost and the middle-income housing. And those are sectors that our financial institutions have been happy and have had an appetite to support. Judy encouraged people to think about investing or going into affordable low cost housing and also starting schemes like build to rent or rent to buy, a sector that have not really been tried and tested in our market but a very good option or asset class for investors.
Michael. K. Mugabi, Managing Director, Housing Finance Bank Ltd said that the bank, which is an indigenous bank, has for the last 53 years of tailored financing solutions for growing customer base, uniquely into financing housing and mortgages to enable people acquire houses for all occupy without rent, but have since grown into a fully-fledged commercial bank.
Uganda’s housing unit is growing at an annual rate of about 200,000 units, and estimated to grow to about 2.6 million units over the next 10 to 20 years. Uganda has one of the highest urbanisation rates of 5% on the African continent coupled with fast growing population. This is an indication of many opportunities for developers and investors who want to participate in rental space.
Several of our customers in the diaspora have actually taken on these opportunities and are happily reaping from the investment options in the real estate sector, Michael added.
Michael recognised the definitely immense stress COVID-19 has presented to customers in the diaspora, and the bank has relief in form of restructuring loans and mortgages for customers who are currently finding it difficult to make their regular monthly instalments to get some form of relief in terms of moratoriums or repayment holidays.
Edwin Musiime, CEO- Crest Group – NTV Host, THE Property Show quoted words from Russell, an American financial politician who said that “real estate is imperishable asset ever increasing in value. It is the most solid security that human ingenuity has devised, it is the basis of all security and about the only indestructible security” and he appealed for Ugandans in the Diaspora to invest in real estate.
Allan Mugisha, CEO SM Cathan said that during and before COVID-19 fixed asset appreciation was between 5% and 7%. He also advised on improving real estate market transparency, especially data.
Advised further on the idea of returning to institutional housing, where government gives housing to public workers like teachers and servicemen, zones for industrial processes. Municipality need to be demanded to invest in neighborhood infrastructure to bring down the cost of the developer to deliver a unit.
Eric Olanya, country director for the Department of international trade explained that, the Department for International Trade, a UK government ministry secures UK and global prosperity by promoting and financing trade, international trade and investment and championing free trade, working as part of DIT Africa hub, which is in 23 countries across Africa, and in January hosted the UK-Africa investment summit in London where Uganda featured really well, with hundreds of £millions of deals signed.
Currently, Eric added, the biggest push for DIT business in Uganda has been using the UK export finance, which is mainly to support so sovereign loans, like funding the developments of the Kabaale International Airport, which is 6% completion, in May, this year, they flagged off the that construction of Namanga Industrial Park, doing many other
Eric disclosed of the recent merger of the two UK government departments of the Foreign and Commonwealth Office, and the Department of international developments into one department called FCDO, it looks at both political engagements, as well as developmental engagements.
Finally, he advised investors to take advantage of the new platform “Africa deal room” (asokoinsight.com/deals/dit/investor) to help bring together ventures that are seeking investment, businesses looking for investment in particular ventures, and those that are looking to finance investments. He was excited to mention that a number of investments are being financed mainly in the region, one to $5 million. He encouraged those who are both seeking investment or looking for investable projects to just register on the on the on the deal from Africa.
Mathias Katamba, Managing Director, DFCU Bank discussed the importance of Why are investment clubs and Saccos becoming a key investment vehicle.
Anthony Kituuka, ED, Equity Bank Uganda LTD gave an insight on some of the transformations adopted during COVID 19, a transformation from cash-based transactions to technology-enabled formats such as mobile money.
Paul Omara, CEO, Ngetta Tropical Holdings Ltd and Non-Executive Director, Housing Finance gave an insight on the role of Staple Crop Processing Zones in laying out the foundation for Uganda’s Agro-industrialisation and contribution to lifting millions of Africans out of poverty.
Perez Ochieng, Director & CEO, SACOMA elaborated on the challenges and requirements for Agro-products from Uganda to access the European market.
As the concluding remarks, the Vice Chairman of the Convention Bernard Magulu said that the success of the convention for the last 10 years has been due to the collaboration and good will of Ugandans in the UK and its dedicated partners like the Uganda government, private sector and friends of Uganda.
Willy Mutenza the founder of the convention hailed the overwhelming support of Ugandans in the Diaspora and the business community and quoted Cesar Chavez “We cannot seek achievement for ourselves and forget about progress and prosperity for our community… Our ambitions must be broad enough to include the aspirations and needs of others, for their sakes and for our own.”
The 11th Convention is set from 11-12th September 2021 at London Plaza Hotel. For more information and registration visit http://www.ugandanconventionuk.org/