About
Uganda
Uganda, the “Pearl of Africa” gained independence in 1962 and
enjoyed many years of strong economic and cultural development. However, political
instability which began in the late 1960's reversed the gains that had been made.
By the mid 1980's Uganda was one of the poorest countries in the world...more
>>
For more about uganda , please visit 
http://www.enteruganda.com/
Uganda
at a Glance - 2000
WTO: member
Status: Least Developed Country
ACP: member
Population: 22.2 million
Population growth rate:
3%
GDP growth rate (2000): 4.4%
Surface
area (1997): 241.0 thousand sq. km
Population
per sq. km (1997): 111
GNI per capita : 310
US$
GDP : 6.3 billion US$
Uganda
at a glance in detail
Uganda,
the “Pearl of Africa” gained independence in 1962 and
enjoyed many years of strong economic and cultural development. However, political
instability which began in the late 1960's reversed the gains that had been made.
By the mid 1980's Uganda was one of the poorest countries in the world.
Uganda
World Bank Brief
At the time of its independence from Britain
in 1962, Uganda was an emerging success story with rapid agricultural growth,
a developing industrial sector, and growing intellectual and cultural leadership.
The early years of independence were marked by political instability and social
violence. However, progress was dramatically reversed by the late 1960s when political
instability was followed by a coup led by Idi Amin in January 1971, and turbulence
continued after Mr. Amin was overthrown in 1979. The period from 1962 to 1986
saw eight changes of government, four of them achieved by military force. Much
of the violence was ethnically directed.
By the time President Yoweri
Kaguta Museveni and the National Resistance Movement (NRM) or the "Movement"
assumed power in 1986, Uganda had become one of the poorest countries in the world.
The education and health systems had collapsed, the physical infrastructure had
crumbled, and the civil service had been destroyed by low wages and poor morale.
Furthermore, the economy was highly regulated with state intervention in nearly
all sectors. Real gross domestic product (GDP) per capita was 42 percent below
its level in 1970; the public revenue base had collapsed; inflation was raging;
and government expenditure, exports and investment had all fallen to below 10
percent of GDP.
Since 1986, the Movement government has been in power, led
by President Museveni. The new relative stability within the country was quickly
turned to economic advantage, as the government and international donors began
to rebuild the devastated economy after years of civil war. An aggressive reform
program aimed at liberalizing trade, privatization and fiscal and monetary discipline
was launched, achieving average GDP growth rates of over 7% though the 1990s.
Political Overview
Economic change
has been accompanied by political reform. The government is composed of broad-based
political groupings brought together under the country's no-party political system.
In March 1994, a new constitution, drawn up after wide public consultation, was
considered by a constituent assembly, elected specifically for the purpose. Under
the new constitution, which came into force in October 1995, the Movement system
was to be retained for at least five more years. Mr. Yoweri Museveni, was elected
President through universal adult suffrage in 1996 and 2001 by an overwhelming
margin. In June 2000 a national referendum on introducing a multiparty system
was held, in which Ugandans voted overwhelmingly to retain the current Movement
system. In June 2001 Ugandans elected 292 members of parliament. Movement candidates
sympathetic to President Museveni dominate the new parliament. Opposition candidates
took 35 seats. Uganda's Constitution bars Museveni from seeking re-election in
2006.
Insecurity in Northern and Western Uganda:
The Museveni Government took power in 1986, ousting the regime
drawing support from the North. Disaffection of Northern Uganda dates from this
time. Conflicts with varying degrees of intensity have taken place in the North
since 1987 led by the Lord's Resistance Army (LRA). The conflict in Northern Uganda
is also generally linked with the conflict in Southern Sudan led by the Sudan
People's Liberation Army (SPLA). The latest round of increased insecurity and
violence in the North follows closely at the heels of the recent efforts between
Uganda's President Museveni and Sudan's Omar Hassan Ahmed El- Bashir to resolve
differences and to work towards peace and security along their common border,
in accordance with a Nairobi peace agreement of December 1999.
The conflict
in the West dates from mid-1990s but has been generally suppressed for the last
year. This is loosely tied up with insecurity in Democratic Republic of Congo
(DRC). The conflict in the North has severely disrupted normal activity in much
of the North with LRA effectively terrorizing local inhabitants. The conflict
in West has been more localized. The Government of Uganda has sought to curb the
insurgency through both military action and efforts at engaging the insurgents
in dialogue. However, concerted action is needed to arrive at political reconciliation
in North, improve socio-economic conditions in affected areas and integration
of internally displaced persons and refugees.
Economy
Uganda has substantial natural resources, including fertile
soils, regular rainfall, and sizable mineral deposits of copper and cobalt. Agriculture
is the most important sector of the economy, employing over 80 percent of the
work force. Coffee is the major export crop, accounting for over half of export
revenues. Since 1987 the government, with the support of donors, has rehabilitated
and stabilized the economy by undertaking currency reform, raising producer prices
on export crops, increasing prices of petroleum products, and improving civil
service wages. The policy changes are especially aimed at reducing inflation and
boosting production and export earnings.
Uganda has emerged as robust economic
performer in the past few years. Average real growth over the '90s has been close
to 7%. This has occurred in a stable macro-economic environment (inflation reduced
to some 5%); improved balance of payments situation (gross reserve coverage over
5 months imports). A high level of donor assistance (about 13-14 % of GDP) has
played a vital role in supporting policies leading to this growth. Recent years
have seen a slight moderation in growth. The slowdown is due to external factors
(drought, adverse trade shocks) and has been well-managed by the Government. Turning
to Fiscal Year 2002, Uganda's overall performance has been robust: real GDP growth
in FY02 is estimated at 5.7 percent (due to adverse weather and falling coffee
prices), but inflationary pressures were contained.
Overall, in agriculture,
Ugandan coffee growers have responded to the reforms by regaining the position
of the largest coffee grower in the continent, the tea industry has been revitalized,
a small horticulture industry is emerging, and maize exports to neighboring countries
are growing. The industrial sector has also expanded rapidly, with real output
growth of nearly 12 percent per year over the nineties. Infrastructure rehabilitation
has been impressive and the government is creating a national road grid that will
connect all parts of the country. However, power shortages have posed a key development
constraint. The Government has also made major efforts to improve social conditions
of the disadvantaged, notably by the implementation of a program of Universal
Primary Education, which has led to a more than doubling in enrollment at primary
school levels. Access to primary education is almost universal and the Government
is taking steps to improve the quality of education. Options for broadening access
to secondary and tertiary education are currently being explored. There is strong
Government commitment, led by President Museveni himself in the fight against
HIV/AIDS, and the Government is implementing a broad-based, multi-sectoral AIDs
prevention program with admirable results. Programs are in place to improve primary
health care delivery, but implementation has been hampered by ongoing decentralization
process and health outcomes have shown little, if any, improvement. The Government,
private sector and NGOs are all active in health and education, and the Government
funds NGOs and CBOs to deliver both primary education and basic health care services.
Overall, while there has been a commendable 38% drop in poverty
headcount between 1992-2000 (from 56% to 35%), despite adverse external shocks.
But, Uganda remains poor (GDP/capita is around $300) and particular effort is
needed in the North (where poverty remains high, largely due to insecurity).
Uganda has been faced with a serious debt problem. In order to reduce the country's
external debt burden, and in view of its sound macroeconomic reform record, Uganda
was the first country to be declared eligible and to benefit from the Heavily
Indebted Poor Countries (HIPC) Initiative (in April 1998), ensuring some US$700
million (in nominal terms) in debt relief, of which about 50 percent was from
the World Bank. Part of the debt relief from the Bank was in the form of an IDA
grant of US$75 million which was allocated for the Universal Primary
Education Program.
Uganda was also among the first countries
to be declared eligible for debt relief under the Enhanced HIPC Initiative: in
recognition of the effectiveness of Uganda's poverty reduction strategy to date,
the consultative process involving civil society in the formulation of the poverty
reduction strategy, and the authorities' continued commitment to macroeconomic
stability. In May 2000, Uganda reached the Completion Point under the Enhanced
HIPC Initiative. Of the total debt-service relief under HIPC of some US$2 billion,
the World Bank is providing nearly US$1 billion (US$517 million in NPV terms).
The HIPC assistance, in conjunction with comparable action by other
creditors, would allow Uganda to redirect resources to priority poverty reduction
efforts. Indeed, the Government of Uganda's budget, especially post-HIPC has been
strongly poverty focused. Expenditures directly related to poverty reduction are
currently about 35% of all expenditures, up from 18% four years ago. Recently,
the World Bank in collaboration with the Government and other partners, completed
a Debt Sustainability Analysis for Uganda (DSA). The DSA was presented to the
World Bank's Board in July 2002. Permission to broadly disseminate the findings
of the DSA work is being sought from Government.
The government's commitment
to economic stability and private sector-led development remains firm. The improvements
in Uganda's investment environment are now receiving international recognition
and the Government has in collaboration with the private sector and donors, initiated
work on select strategic export commodities.
Development Picture/Donor Coordination
The Bank and other donors
have responded positively to Uganda's economic reform effort and have mounted
an expanded level of donor support. Many bilateral donors are active in the social
sectors, public sector capacity building, civil service reform and decentralization,
as well as governance issues. There are also numerous non-governmental organizations
(NGOs) working in the country, many of which are partners with the World Bank
on specific initiatives. The most recent Consultative Group (CG) Meeting of bilateral
and multilateral donors, was held in Kampala in May, 2001.This highly participatory
CG meeting, with broad representation from the government and donors, was flanked
by a series of sector-specific/thematic meetings in areas ranging from population
issues to public expenditure to partnership principles. Civil society representatives
(from non-governmental organizations, the private sector, the media, and academia)
participated extensively in the meetings. The next CG meeting is planned for the
end of 2002.
Uganda was identified as a Comprehensive Development Framework
(CDF) pilot country; the Ugandan Government has seriously endorsed the principles
of ownership and partnership as well as agreed to the modifications to the structure
of the IDA program proposing a shift to broader budget support in lieu of a series
of discrete projects within and across sectors. Discussions for furthering improved
cohesiveness and coordination between the government and donors on the one hand,
and the within the donor community on the other, are underway with the Government
leading the process. The Government's Poverty Eradication Action Plan (PEAP) provides
the overall framework for donor coordination and basis for Uganda's Poverty Reduction
Support Paper.
World Bank Role
In November 2000, the Bank's Board approved a Country Assistance Strategy (CAS)
for Uganda for the next three years, including an increase in the level of highly
concessional IDA flows in response to Uganda's robust economic performance and
in an effort to reduce poverty more rapidly. The Overarching objective of the
Bank's strategy is to support Uganda's economic transformation and poverty reduction
strategy -- as spelled out in the Government's Poverty PEAP/PRSP. While the work
to maintain macroeconomic stability (begun in the context of the previous CAS)
will continue, the emphasis in assistance under the present CAS has shifted to
the sector level and to cross-cutting public sector management issues. Addressing
these issues and facilitating economic transformation calls first for broadening
the decision making process to involve all key stakeholders, particularly the
sector ministries and civil society. Second, it calls for a change in the Bank's
lending modalities; specifically for a departure from the traditional combination
of adjustment operations and discrete investment programs, toward a comprehensive
reform program financed thought the budget by means of a series of Poverty Reduction
Support Credits (PRSCs). The First PRSC in the amount of US$ 150 million was approved
by the World Bank Board of Directors in 2001, and focused on measures to improve
public service delivery and address cross-cutting public sector issues. The second
PRSC, also in the amount of US$150 million was presented to the Board together
with the 2002 PRSP Progress Report on July 23, 2002, and expanded on the scope
of PRSC 1, by introducing measures aimed at strengthening rural development. The
PRSC provides external finance to the budget in support of the authorities' commitment
and implementation of a far reaching reform agenda based on the PRSP.
Presently,
the World Bank portfolio comprises a budget support operation and 25 investment
projects in agriculture, infrastructure, and the social sectors, with a total
commitment of over US$1 billion. In addition, the World Bank is working with Uganda
on four to five projects a year across major sectors. There is close interaction
with the International Monetary Fund on the macroeconomic program.
The
International Finance Corporation (IFC), the World Bank Group's private sector
lending arm, focuses on institution-building in the financial sector; small-scale
manufacturing with high local resource content; rehabilitation of existing assets;
infrastructure (especially power); agribusiness; and tourism. IFC's program in
Uganda ranges from US$30-$50 million over the next 3-5 years.
The Multilateral
Investment Guarantee Agency (MIGA), the Bank Group's political risk insurance
arm, has issued guarantees for investments in the mining, manufacturing, telecommunications
and agribusiness sectors in Uganda, which has been a MIGA member since 1992. MIGA
has also provided technical assistance activities in mining, tourism investment
promotion, capacity building for investment intermediaries, and information dissemination
tools.
The Bank Group's World Bank Institute (WBI), in partnership with the
Government of Uganda, has a major ongoing initiative on Anti-corruption, Effective
Service Delivery, Health, Intergovernmental Fiscal Relations, District Integrity,
Participation, and Journalist Training. A number of activities in each of these
areas as well as other national activities planned, are in the areas of environment
policy and sustainable development. To support efforts to improve governance,
WBI has held capacity building seminars for politicians and technocrats. The Global
Learning Center was launched in FY00..
Contacts
Judy O'Connor
Country Director
The World Bank
1818 H St. NW
Washington, DC 20433 USA
Tel: (202) 473-5813
Fax: (202) 473-5453
Email: Joconnor1@worldbank.org
Ronald
Brigish
Country Program Coordinator
The World Bank
1818
H St. NW
Washington, DC 20433 USA
Tel: (202) 473-6691
Fax: 202-473-5453
Email: rbrigish@worldbank.org
Robert
Blake
Country Program Manager
World Bank Resident Mission
Rwenzori House
Kampala, Uganda
Tel. (256) 41 230094
Fax: (256) 41
230092
Email: rblake@worldbank.org
Preeti
Ahuja
Senior Country Operations Officer
The World Bank
1818 H St. NW
Washington, DC 20433 USA
Tel: (202) 473-1675
Fax: 202-473-5453
Email: pahuja@worldbank.org
Mary Bitekerezo
Kasozi
NGO Liaison Officer
Kampala Resident Mission
Tel:
(256) 41 230094
Fax: (256) 41 230092
Email: mbitekerezokasozi@worldbank.org
Main
Cash crops Coffee,
Cotton, Tea, Sugar, Sesame seed, Flowers, Spices, Tobacco
Main
Food crops Bananas,
Maize, Cassava, Beans, Sweet potatoes, Sorghum, Millet
Added
value agricultural products Dairy
products, brewing.
Agriculture
and Economy
Uganda
returned to stability in 1986 after many years of violent turbulence and still
suffers from sporadic conflict. In 1987 the government embarked on an economic
recovery programme aimed at restoring fiscal discipline, rehabilitating the infrastructure
and boosting export earnings. Investment incentives were increased and the exchange
rate system reformed. Foreign investment increased and coffee production boomed.
The country achieved an economic growth rate which averaged 7% for a decade. Growth
has been curtailed somewhat in recent years mainly due to the fall in commodity
prices. Uganda remains heavily indebted but, due to its macroeconomic reforms,
the country has benefited from the Heavily Indebted Poor Countries Initiative
for debt relief.
The
agricultural sector has been hampered by input shortages, poor rural roads, occasional
drought and low producer prices. The country has a wide diversity of climatic
and soil conditions which allow for the production of a large range of different
crops. Most production is small-scale but sugar and tea are grown on large plantations.
Uganda is now the largest coffee producer in Africa. The industry has been liberalised
and 90% is controlled by the private sector. The small-scale producers are now
able to deal directly with buyers but this has made them more vulnerable to price
fluctuations and unscrupulous traders. Less cotton is produced now than in the
past again due to low prices but also to high costs and security problems in the
growing areas. A small horticultural and flower sector is emerging and is seen
to be a growth industry.
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