Uganda has emerged a favourite destination for foreign investors in the East African region, toppling Kenya, according to the World Investment Report 2013, released by the United Nations Conference on Trade and Development (UNCTAD) recently. The report shows that Uganda received the most Foreign Direct Investment (FDI) in 2012 particularly in the oil, gas, and mining sectors. Uganda’s FDI inflows increased by 92 percent from US$ 894 million in 2011 to US$ 1.721 billion, a rise believed to have been boosted by the recent discoveries of oil in the country.
At the same time, FDI in Kenya reportedly dropped by 27 percent from US$ 355 million in 2011 to US$ 259 million. Notably, since the liberalisation of the economy in early 1990s, Uganda has greatly attracted foreign investors buoyed by a relatively favourable investment climate. And the government of Uganda including President Museveni himself is increasingly wooing more foreign investors to come and invest in Uganda.
Several delegations have been sent to Europe and Asia to inform potential investors of the investment opportunities in Uganda and the results have been impressive as a week rarely goes by without the Ugandan government signing a Memorandum of Understanding (MoU) with foreign investors or receiving foreign delegations seeking for investment opportunities in Uganda. In fact, the law permits 100 per cent ownership of investments and, with very few exceptions, investors can invest in any economic activity.
The investment licensing requirements include a minimum capital of US$100,000 for foreigners and US$50,000 for Ugandans. However, with some critics arguing that foreign owned companies don’t do much to develop the country since the profits are repatriated, the most mind boggling thing remains; at which level should Uganda open up to foreign investors?
Building Wealth; Five Ugandan Entrepreneurs Democratizing Access to Investments.Uganda ranks 15 out of 102 countries as an attractive destination to make profitable investment in the world. Indeed these claims rather fears, are affirmed by the Baseline Profitability Index (BPI) 2013, which puts Uganda in number one position in the category of ease of repatriation of capital out of the 102 states that were surveyed.
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However, Eng. Dr. Frank B. Sebbowa, the Executive Director, Uganda Investment Authority (UIA) thinks otherwise.“It’s good to have Foreign Direct Investments (FDIs) because they bring in new technology, cash itself and the human skill. When these are brought into the economy, the business does well and becomes profitable,
