TRALAC - Trade Law Centre

Uganda: Textile industry needs investors

Monday, 03 September 2007

Source: East African Business Week (Kampala)

Uganda has got to attract new investments into its weakened cotton-textile sub-sector if a revival of any kind is to be achieved in a sector that was once vibrant.

Together with coffee and copper, cotton was part of the famed 3Cs - pillars of Uganda's economy before its collapse in the mid-seventies. At the time, Uganda was one of the best cotton producing countries on the continent.

The textile industry at the time employed more than 500,000 people and earned the country more than US$100 million annually from export of lint cotton alone.

However, due to mismanagement of the economy in the 1970s, growing of cotton drastically declined and consequently the textile industry collapsed.

Today, the 250,000 bales of cotton that Uganda produces annually is grown by smallholder farmers in the south western district of Kasese and in eastern Uganda.

Attempts made so far at reviving the sub-sector under the Africa Growth and Opportunity Act (Agoa) through Apparels Tri-Star Limited have achieved very little results.

Stakeholders in the sector have suggested a range of measures that should facilitate a faster development of the industry..

They met last week at a national consultative workshop that was organised by the Textile Development Agency (TEXDA) to look at the opportunities and challenges in the sector.

They include a total ban on second hand clothes, removal of duty and other tax on textile machinery and raw materials and development of a cotton-textile policy among others.

"The government must come up with a comprehensive textile and garment policy as a matter of urgency," Mr. Aaron Wanyama, the dean faculty of science, Kyambogo University said.

Wanyama, who is also a chartered member of the Textile Institute of the United Kingdom (UK) said, "there is need to develop the whole value chain of textile industry from the fibre to the garment."

This however does not mean that government has not done enough to revive the sector.

According to Mr. C. J. Okulo, the assistant commissioner in the department of industry and technology and the ministry of tourism, trade and industry, a lot is yet to be done.

"The present investments in the sector are not even working at optimal capacity. Presently most of them are working at below 50% installed capacity. Government therefore needs to support financing modernisation of existing mills," Okulo said.

Okulo believes capacity utilisation for local textile manufacturers can be stimulated if government bought local textile requirements for all government departments such as the armed forces and the police force, prisons, Uganda Wildlife Authority, hospitals and local administration police.

"The development of a strong and competitive local textile and clothing industry will take decades to be realised as long as the government remains complacent to the danger used clothes dumped into this country pose as a major hindrance to the development and investment in the local industry," Wanyama said.

Wanyama proposed a merger between the Uganda Textile Manufacturers Association and the Uganda Garment Manufactures' Association to form the Uganda Apparel and Textile Federation (UGATEF).

If formed, UGATEF will enhance coordinated and collaborative policies and strengthen the common agenda on all matters necessary and beneficial for the development of the textile industry.

He has proposed that all import of textile machinery and raw materials should be duty free to facilitate import of the latest textile machinery, which would prove to be a big incentive for investment in the textile sector.

He called for the establishment of textile parks as special economic zones for tax free production and export to enhance its modernisation and production capacity.

Wanyama has proposed that a state-of-art textile laboratory be set up either at the Uganda National Bureau of Standards or at one of the public universities in this country.



“ Latest AGOA Trade Data currently available on AGOA.info


Click here to view a sector profile of Uganda’s bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.