Flush With Cash, Starved of Capacity: Why UNBS Risks Becoming the Uganda National Bureau of Substandards UNBS closed the 2023/24 financial year with record revenues, UGX73.9 billion in non-tax revenue, which was far above its UGX54.4 billion target. But even with such a performance, government did not remit the required UGX60.04 billion. Instead, the agency received only UGX56.65 billion. Additionally, UNBS has just 538 staff, barely 45% of its approved structure of 1,200, which makes it hard for the agency to police a market whose supply of standard goods stands at 58%.

Uganda’s watchdog charged with policing the quality of goods and services is flush with cash yet dangerously hollow in capacity.

Uganda National Bureau of Standards (UNBS) closed the 2023/24 financial year with record revenues—UGX73.9 billion in non-tax revenue.

This was far above its UGX54.4 billion target and sharply higher than the UGX60 billion recorded the previous year.

Import inspections also crossed 293,000, well beyond the 200,000 goal. On paper, the regulator looks stronger than ever.

But the picture on supermarket shelves tells a different story.

More than half of locally produced goods—including food, drinks, and cosmetics—slip through the cracks, entering the market at inferior quality.

UNBS’s own 2022/23 Annual Report admitted that substandard goods rose from 49% in 2020/21 to 58% by mid-2023.

The Auditor General has long warned that this weak enforcement has turned Uganda into a “stockpile of substandard goods”.

This has a profoundly negative impact on trade and risks lives.

At a basic economic level, this is a textbook case of market failure.

When quality is invisible at the point of purchase, bad goods drive out good ones — a version of George Akerlof’s “market for lemons” problem.

In Uganda’s open stalls and supermarkets, consumers cannot easily distinguish safe from unsafe products.

Without effective regulation, the incentive is to cut corners.

Counterfeiters thrive in the short term while compliant firms are punished with higher costs and slower approvals.

Private Sector Foundation Uganda’s chief executive, Steven Asiimwe, calls it a full-blown crisis.

“You will find a bottle of Johnie Walker- the seal, the packaging, everything looks real, but what is inside could be poison.”

“These mafias have become sophisticated using advanced printing and packaging to fool unsuspecting consumers,” he says.

The scale of harm is immense. The World Health Organisation estimates fake anti-malaria drugs kill up to one million Africans each year.

In Uganda, nearly 21,000 cancer deaths annually are increasingly linked to counterfeit foods and cosmetics laced with mercury, lead, and other toxins.

These are banned elsewhere but are freely sold in Kampala’s shops. Parliament has sounded the alarm too.

Speaker Anita Among said recently, “it is out of counterfeits that people get sick, and this explains the rise in cancer cases and accidents on our roads”.

“You find people who are selling genuine things having to compete with others selling dangerous counterfeits at a cheaper price.

This causes tax distortions but also brings unfair competition against the genuine manufacturers.”

Meanwhile, the very functions that should provide protection are failing.

Market surveillance—the frontline defense against dangerous goods already circulating in shops and factories—achieved just 27% of its target.

Only 2,453 inspections were carried out of the 9,000 planned, leaving vast gaps where counterfeit and unsafe products thrive.

The consequence was stark: 11,000 tonnes of uncertified products seized and 63 facilities sealed off, including maize mills and bakeries.

Laboratories, which should be the backbone of product safety, also underperformed.

While they tested 26,521 samples, turnaround times in chemistry and microbiology worsened, some stretching 25% longer than planned.

Standards development stalled, too, with just 41 new or amended standards approved compared to 389 the year before.

This left at least 215 drafts stuck and delaying reforms critical to food, agriculture, and consumer protection.

Economists call standards a public good — their benefits are broad and shared, but the cost of enforcement is concentrated.

No single firm has an incentive to police quality for the whole market, so only the state can do it.

When that enforcement collapses, the entire system tips into a low-trust equilibrium.

Consumers assume quality is poor, exporters suffer repeated rejections, and honest producers are crowded out by cheats.

That dynamic is exactly what the Economic Research Centre points to in explaining why Uganda, despite being one of the most entrepreneurial countries in the world, struggles to see businesses flourish.

In a market where counterfeits dominate and regulators falter, entrepreneurship becomes less about scaling innovation and more about surviving unfair competition.

Starved of staff and resources

At the heart of this paradox is a structural weakness.

UNBS has just 538 staff — barely 45% of its approved structure of 1,200, according to its 2023/24 performance report.

The shortfall undermines decentralization, leaving many gazetted entry points unmanned and regional offices skeletal.

Market surveillance failures, lab delays, and weak metrology coverage all trace back to a regulator that simply does not have the people to do the job.

Funding is no less fragile. Although UNBS collects billions in non-tax revenue, it cannot directly spend what it raises.

It remains dependent on government disbursements, which are often incomplete.

In the 2023/24 financial year, it was allocated UGX60.04 billion but received only UGX56.65 billion.

A further UGX3.3 billion in development funds was never released.

The irony could not be sharper: a regulator generating record inflows is simultaneously starved of the resources it needs to police the market.

Economically, this reflects a misaligned incentive problem — the state prioritizes revenue collection while enforcement is underfunded.

The result is a lopsided system. Imports are checked at the border, and money piles up on paper.

But counterfeit tyres, poisonous spirits, and mercury-laced cosmetics still slip through and end up in shops and homes.

Risks for consumers and exporters

The implications are serious. For local consumers, the flood of seizures – from substandard steel to illicit alcohol – is evidence that unsafe goods still dominate the marketplace.

Fake medicines are killing livestock and reducing the quality of milk and meat, while contaminated grains and food products continue to trigger export rejections.

Last year alone, more than 50 truckloads of Ugandan maize were turned away by South Sudan due to poor quality and the presence of aflatoxins.

The alcohol industry illustrates the scale of the rot. Surveys and UNBS data show that over half of all drinks consumed in Uganda are illicit.

This drains an estimated UGX3 trillion annually from the economy.

But the losses are more than fiscal.

Unsafe alcohol, counterfeit medicines, and contaminated food supply chains are steadily eroding public health and cutting lives short.

Economically, these are negative externalities — private profit for counterfeiters translates into heavy social costs for households, hospitals, and the treasury.

For exporters, the risks are equally corrosive.

South Sudan’s rejection of maize consignments was only the most visible reminder that poor standards undermine Uganda’s credibility in regional markets.

Each rejection not only blocks a truck but chips away at Uganda’s competitiveness.

In EAC and AfCFTA markets, where common standards are the passport for goods to move freely across borders, the country is undermined.

UNBS itself concedes that voluntary compliance among manufacturers and traders remains low.

This reflects both weak sensitization budgets and thin enforcement.

The result is a self-reinforcing cycle familiar to economists.

Poor compliance feeds weak competitiveness, which in turn entrenches dependence on cheap, substandard production.

Once that cycle takes hold, it becomes rational for firms to cut corners rather than invest in quality — a trap that holds back entire industries.

Bright spots amid the weakness

To its credit, UNBS has notched some successes. It secured an unqualified audit opinion from the Auditor General for maintaining international accreditation for its food safety laboratories, and expanded automation through its e-portal systems.

These achievements matter: they boost institutional credibility and show that, despite glaring weaknesses, parts of the machinery are functioning.

The National Metrology Laboratory, built with African Development Bank support, is also nearing completion.

Once operational, it is expected to serve as a regional center of excellence in measurements and calibration — a crucial investment in infrastructure.

Without such systems, exporters remain trapped in low-value markets.

Certification efforts have also expanded. UNBS issued 4,951 Q-Mark permits (up 1.3%) and certified more than 1,200 MSME products in the past year.

These milestones align with Uganda’s “Buy Uganda, Build Uganda” agenda, offering a foundation for long-term competitiveness.

Economically, this is how reputational capital is built.

Consistent certification gradually allows local firms to earn consumer trust while qualifying for regional and global markets abroad.

A watchdog at the crossroads

Still, the central paradox remains. UNBS is generating more money than ever before but delivering less enforcement where it matters most.

Unless government reforms its funding model and closes the staffing gap, the Bureau risks being reduced to a revenue collection machine.

For now, Uganda’s standards watchdog is a lion on paper — strong in numbers, but toothless where the public most needs its bite.

Many standards experts point to weak enforcement as the core problem.

UNBS, tasked with protecting consumers, has fewer than 100 inspectors to cover the entire country.

Outdated laboratories, porous borders, and corruption deepen the challenge.

Even the security stamps meant to prove authenticity are easily forged, industry players acknowledge.

When UNBS inaugurated its 10th National Standards Council, Trade Minister Francis Mwebesa urged the council to strengthen standards infrastructure, improve the quality of locally manufactured goods, and protect the public from substandard products.

The economic stakes are sobering. Fred Muwema, chairman of the Anti-Counterfeit Network, estimates counterfeiters drain over UGX6 trillion from Uganda’s economy each year.

“You cannot build a strong economy on a foundation of fake goods,” he says, noting “we are choking legitimate businesses and endangering lives.”

Economically, this is the essence of a deadweight loss. Counterfeiters pocket profits while society bears the cost in lost taxes, unsafe products, and stunted industrial growth.

A section of standards experts like Muwema now argue that enforcement muscle must be paired with a stronger legal backbone.

Their hope rests on the proposed Anti-Counterfeit Bill.

The Bill has completed public consultations and could finally give authorities sharper tools to tackle this crisis head-on.

If enacted and backed with real resources, such a law could start to reverse the cycle.

It could shift the balance from a counterfeit-driven equilibrium to one where genuine producers and consumers have a fair chance.