Uganda to work on increasing exports in wake of Covid-19 challenges

Uganda to work on increasing exports in wake of Covid-19 challenges
Published date:
Sunday, 13 December 2020

In the wake of COVID-19 and its devastating effects, Uganda is producing solution-based products onto market.

Unlike in the past, Ugandan products have been warmly received by local consumers because of their improved quality, says NRM National Treasurer Namayanja Rose Nsereko.

According to her, Ugandan scientists are in final stages of testing COVID-19 vaccines with 90% probable curing capacity.

“All these innovations coupled with ambitious plans to industrialise Uganda are great strides desirous of our celebrations.”

However, studies have revealed that most of the goods are in surplus on Ugandan market thus necessitating us to tap into external markets for more revenues. This is the reason the Government is increasing market for exports.

Namayanja says that the challenges to external market access have historically ranged from subsidies used by wealthy nations down to regional and local level factors.

“It is on this basis that Africa has been shifting away from traditional trading partners over the past two decades,” she said.

The study shows the Africa products in EU market reduced from about 40% in 2,000 to 25% in 2017 and the US from nearly 25% in 2,000 to 8% in 2017 and increasing its exports to China from 5% in 2000 to over 20% in 2017 and India from 3% to 10%.

Like aggregate exports, Africa’s manufacturing exports too, have shifted away from EU, declining from 50% in 1995 to 25% in 2015. The share of manufacturing exports going to the US has remained stable at around 10% in last 25 years. Yet in 2001, the US government offered Africa privileged access to US market under Africa Growth and Opportunity Act (AGOA) as a mechanism to stimulate export growth in the continent.

AGOA provides for duty-free treatment for about 6,500 goods from eligible sub-Saharan African countries exported to the US.

Uganda was one of the first countries to express interest in benefiting from AGOA’s provisions and some of Uganda’s eligible products include agricultural and forest products, textiles and apparel, footwear, minerals and metals. However, Uganda’s exports to the US under AGOA have been dropping steadily mainly due to some of unclear guidelines by the US customs. The paperwork is nightmare, forcing most traders to pay duties rather than doing paperwork. Some government officials have not been helpful to these people for failure to give them enough support.

Namayanja says that in the next NRM’s term, this shall change to enable our apparel manufactures and craft makers in particular to benefit from AGOA because products’ demand is high.

Apart from AGOA and European Union’s Everything But Arms (EBA) where EAC partner states receive full duty-free and quota-free access to EU for all exports with exception of arms, the NRM National treasurer says that the government has also negotiated a number of regional trade agreements, including EAC common market protocol, COMESA and Free Trade Agreement and the COMESA-EAC-SADC Tripartite Free Trade Area.

“The World Trade Organisation (WTO) also granted a waiver to allow preferential treatment for services and service suppliers from least developed countries (LDC).”

This, according to her, explains why today Uganda has emerged as the champion of rising share of manufacturing exports going to other SSA countries from East Africa and with implementation of the Africa Continental Free Trade Area (AfCFTA), “Uganda is set to consolidate her position and find more markets for our products.”

Building on Pan-Africanism principle, she says NRM longs to maintain close working relationship with other African states to ensure success of free continental market to support our people’s prosperity.

“It is our belief that with a well-functioning African free market, the issue of marketing will be addressed as elaborated in achieving economic and political integration.”

“We are working directly with private sector organisations such as UMA, Uganda National Chamber of Commerce and Private Sector Foundation Uganda to help manufacturers and other producers identify markets and look for buyers of Ugandan products within the region and international markets next term,” she said.

She added that, “We also intend to increase support both financial and capacity enhancement to our trade support agencies such as Export Promotions Board, UNBS and Uganda Coffee Development Authority to provide precise market information and knowledge to buyers in the target market. Our products have to be competitive in quality, availability, safety and price. To ease movements to market, we are investing in railway, water and air cargo transport infrastructure.”

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