By CHIMPREPORTS
The optimism surrounding Uganda’s potential as a superpower is palpable, with leaders and communities at all levels engaging in discussions and actions aimed at achieving significant economic growth and positioning the country as a first-world nation in our lifetime.
For those who have yet to join this transformative journey, the time to do so is now.
In concrete terms, Uganda’s ambitious goal to grow its economy tenfold requires an average annual growth rate of 17 percent over a 14-year period (2024/25-2037/38), rather than the typical 10-year period. In simpler terms, Uganda must double the size of its GDP every five years to reach the target of US$500 billion before 2040.
This perspective is rooted in data and represents a consensus among Uganda’s economists and public policy professionals.
Over the past decade, Uganda’s economic growth has averaged 4.7% per annum, notably lower than the 7.3% average growth in the previous decade. The challenges faced include internal shocks from COVID-19, adverse weather conditions, and external shocks resulting from conflicts and instability in Ukraine, Sudan, the Middle East, and the Democratic Republic of Congo.
Various contextual and historical factors have also constrained Uganda from achieving exponential and geometric growth rates, as detailed in the extensive libraries of historical records. This discussion will refrain from delving into the specifics of Uganda’s complex history.
From my current perspective, the outlook for economic growth is panoramic. The foundation for propelling the economy forward is robust and well-established. There are evident and promising opportunities with the potential and agility to drive Uganda’s economy to a 17% annual growth rate for at least 14 years, generating substantial revenue, creating numerous jobs, and fostering inclusive prosperity.
Examples
Undoubtedly, there are countries with economic bases similar to Uganda’s (Financial year 2022/23) that have achieved exponential growth in their GDP, despite differing political and social structures. Notable examples include South Korea, with 22 years of growth at an average annual rate of 13% (from US$ 38.0 billion in 1977 to US$1,665 billion in 2023); Chile, experiencing 33 years of growth at an average annual rate of 4.5% (from US$33 billion in 1990 to US$316.7 billion in 2023); Singapore, with 33 years of growth at an average annual rate of 8.7% (from US $36.1 billion in 1990 to US$466.8 billion in 2023); Malaysia, achieving 34 years of growth at an average annual rate of 8% (from US$ 38.0 in 1989 to US$406 billion in 2023); and Thailand, with 38 years of growth at an average annual GDP growth rate of 7.6% (from US$ 38.9 billion in 1985 to US$ 500 billion in 2023).
The remarkable GDP growth of these countries occurred within the span of a single generation. A substantial portion of this success, as indicated by diverse peer-reviewed sources, is attributed to the influx of Foreign Direct Investment (FDI), which helped bridge their savings-investment gaps and significantly contributed to human capital formation.
Uganda is strategically positioned to achieve its exponential growth ambitions during this period, considering the substantially larger and interconnected global market coupled with advancements in new industrial technologies.
Through a well-thought-out industrial policy, Uganda has established an investment land bank covering 75 square miles across the country. These areas are designated for fully serviced industrial parks, equipped with essential infrastructure such as industrial electricity, water, roads, fiber optics, and waste facilities. This comprehensive infrastructure base aims to add value to agricultural products (supported by the Parish Development Model), minerals, forestry products, and the production of knowledge-based items like electronics, phones, computers, medicines, and petrochemicals. The establishment of data and logistics centers is also envisioned, creating an estimated 2.5 million jobs in the medium and long term.
Moreover, the industrial parks will serve as catalysts for new sources of growth, including industrial-scale skills formation, the adoption of emerging technologies, and the consolidation of markets in the region, Africa, and beyond.
To underscore these ambitions, tangible progress in technology and innovation is already evident in operational industrial parks.
The remarkable progress in Uganda’s technological and innovative landscape is exemplified by various groundbreaking initiatives. Notable examples include Quality Chemicals Ltd’s development of a single HIV pill, Plascon Uganda Limited’s creation of an anti-malarial paint, Orion Electricals and Transformers Ltd’s production of Gas Insulated Switchgear (GIS) transformers, Roofings Rebar plant’s utilization of reinforced high-tensile steel, Fei Long Investment Ltd’s innovative recycling of plastic into fabric, and East African Medical Vitals’ pioneering production of the first powder-free surgical gloves.
Moreover, there has been a significant shift towards local manufacturing, exemplified by Afford Agencies Ltd, Orion Electricals, Transformers Ltd, and Steema Transformers and Electricals Ltd producing fridges and generators.
To achieve the ambitious target of $500 billion, propelling Uganda into a first-world status, comprehensive exploitation of economic potential in various sectors is essential. According to available simulations and datasets, the agro-industry, for instance, must strive to achieve a target of $20 billion, a considerable leap from the current $1.08 billion per annum.
Minerals
Mineral-based industries are challenged with the task of elevating their performance from the current $1.5 billion to a targeted $20 billion. Similarly, the tourism sector, currently generating $2 billion in revenue, aims to reach an ambitious target of $50 billion, given the global tourism industry’s valuation at $9.5 trillion.
To meet these objectives, collaborative efforts between relevant government agencies and private sector stakeholders are imperative. This collaboration is crucial for efficiently mapping and executing the strategies necessary to attain the set targets.
Achieving these goals seamlessly requires a dedicated focus on certain prerequisites and constants. Key areas for attention include investments in economic and social infrastructure, encompassing energy, urban roads, trunk roads, community access roads, tourism roads, standard gauge railway, marine transport, and internet connectivity. Additionally, substantial investments in research, science, technology, and human capital through robust education initiatives, skill development, and healthcare are essential components of this journey.
Furthermore, the foundational work of consolidating prerequisites is vital. National security, macro-economic stability, the rule of law and order, effective public sector accountability, supportive policies for the private sector, and the continuous deepening of democratic values must remain in focus. These elements are embedded in the adaptive process, ensuring a holistic approach to achieving the outlined economic targets.
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