Uganda’s push for local smartphone manufacturing is rooted in a powerful idea: build at home, create jobs, reduce imports, and retain value within the economy. It aligns closely with the country’s broader economic vision.
Uganda’s Tenfold Growth Strategy, the Fourth National Development Plan (NDP IV), and the National 4IR Strategy all point in the same direction.
They envision an economy expanding from about $50 billion to $500 billion by 2040, driven by industrialisation, value addition, and technology.
The goal is to build a smart, connected, and competitive society where more Ugandans can work, learn, trade, and access services digitally.
In that context, local smartphone assembly fits neatly into the broader ambition. For millions of people, the smartphone is often the first and sometimes the only, gateway into the digital economy.
In practice, however, translating this vision into devices that ordinary Ugandans can afford and trust has proven far more complex.
Uganda has licensed and supported a small number of firms to assemble smartphones locally. Facilities have been established, and investments have been made.
One of the most prominent examples is SIMI Mobile. However, direct engagement with the company’s executives for this story was unsuccessful despite repeated efforts to obtain updated production statistics and market data.
As a result, the details referenced here are drawn from a previously published interview with CEO David Beecham Okwere in the World Business Journal.
According to that interview, SIMI Mobile evolved from a retail outlet founded in 2016 into a manufacturing operation in 2019, supported by an initial investment of about $4 million in machinery, facilities, and workforce development.
The company reportedly assembles approximately 2,500 devices per day, with about 70% sold within Uganda and 30% exported to regional markets, including Tanzania, Kenya, and Morocco.
It has also expanded into tablets and laptops and has supplied solar-powered tablets to the Uganda Bureau of Statistics for national census data collection.
Partnerships have been explored, but the market has not responded in the way policymakers had hoped. Demand for locally assembled smartphones remains low.
The affordability constraint
This is not because Ugandans are resistant to local products, but because of two critical factors, price and quality, which have not yet been fully met. Consumers at the entry level of the market are extremely sensitive to both.
For a first-time smartphone buyer, the device is not a discretionary purchase. It is a significant financial decision that competes with household needs, school fees, and daily survival costs.
When consumers choose a device, they are choosing durability, functionality, and perceived value.
If a locally assembled device does not match the quality or features of imported alternatives, even at a similar price point, the market responds accordingly, and it has.
At the retail level, this gap is already visible. Musa Kirunda of Mush Gadgets, a Kampala-based electronics dealer, notes that despite the government’s Buy Uganda Build Uganda initiative, local assembly plants have contributed little to supply.
They remain largely focused on basic and feature phones rather than competitive entry-level smartphones.
The International Telecommunication Union’s last-mile connectivity assessment presents another dimension: smartphone affordability remains a major hurdle for many Ugandans, limiting their ability to access internet services.
While Uganda is relatively competitive in absolute mobile broadband prices, affordability relative to income remains weak. The country ranks 27th and 28th in Africa for 300MB and 1GB usage, respectively, with 28 African countries offering more affordable 20GB packages.
With entry-level smartphones consuming a large share of monthly income, even small differences in perceived value can significantly influence consumer behavior.
This places local manufacturers in a difficult position. They are expected to compete in a highly price-sensitive market while operating at a relatively small scale, without the economies of scale and supply chain advantages enjoyed by global manufacturers.
At the same time, policy protection mechanisms, including import duties, are intended to create space for these local players to grow.
The policy trap
This is where the tension emerges. Protection can support industry development, but it can also raise prices for consumers if local alternatives are not yet competitive.
In Uganda’s case, that tension has evolved into what MTN Uganda, in its 2026/27 financial year pre-budget submission, describes as a fundamental supply–demand distortion in the smartphone market.
The smartphone tax is defensible in theory. A 10% import duty is intended to protect local assembly and create room for domestic firms to scale. However, MTN argues that the underlying economics do not support this outcome.
Local capacity exists, with firms such as SIMI Technologies and MiOne, but this capacity cannot meet current demand, let alone the significantly larger demand that would emerge if prices fell through the removal of VAT and customs duties.
Even in the case of SIMI Mobile, where production is reported at around 2,500 devices per day, this has not translated into widespread availability of affordable smartphones.
At the same time, international original equipment manufacturers approached about setting up local plants have consistently indicated that Uganda’s market is too small to justify the investment. Attempts to address this through regional manufacturing have also failed.
Proposals to establish production in Kenya to serve the wider East African Community collapsed because import duty regimes are not harmonised, meaning devices assembled in one EAC country still face tax barriers when crossing borders.
This reveals a deeper structural issue: the policy is designed to protect local industry, but the conditions required for that industry to scale, namely great, affordable demand, are not being created.
The data reinforces this contradiction.
UCC’s Q4 2025 market report shows Uganda had 47.1 million active mobile subscriptions, but only 20 million smartphones, compared to 32.2 million feature phones and 6.1 million basic phones.
The device base remains heavily tilted toward non-smart devices, even as the digital economy increasingly depends on smartphones.
A UCC assessment also shows that a locally assembled smartphone costs, on average, about UGX 630,000, nearly double the price of some imported alternatives.
At the same time, uptake remains negligible, with only 1,866 locally assembled smartphones active on the 4G network over six months to January 2026.
The outcome is circular. Taxes are justified as a way to build local industry, but those same taxes suppress the demand growth that could make that industry viable.
The race against time
Should Uganda prioritise building a domestic smartphone industry, even if it slows short-term digital inclusion, or prioritise rapid access to affordable devices, even if that means relying more heavily on imports? The answer is not straightforward and depends on time horizons.
In the long term, a viable local manufacturing sector could create jobs, build skills, reduce dependence on imports, and position Uganda within regional value chains.
But in the short term, the digital economy is moving quickly.
UCC’s Q4 2025 figures show 18.5 million active mobile internet subscriptions, 36.3 million mobile money subscriptions, and 229,000 fixed internet subscriptions.
Uganda’s digital economy is overwhelmingly mobile-led and, therefore, highly dependent on affordable smartphones.
Mobile subscriptions have reached 47.1 million and continue to rise, signalling strong demand. As MTN’s submission makes clear, this is not fundamentally a supply problem; it is an affordability problem.
People want smartphones but cannot afford them. GSMA projects that expanding mobile internet access could unlock millions of new users and significant economic value by 2030, but that opportunity is highly sensitive to price.
At the 2026 Mobile World Congress in Barcelona, a coalition of operators, including MTN, Airtel, Orange, and Vodacom, announced pilot programmes to introduce $40 entry-level 4G smartphones across several African markets, including Uganda.
This initiative is based on a simple premise: mass adoption will come from radical price reductions, not incremental supply improvements.
If access to devices remains constrained, Uganda risks missing part of that growth cycle.
A question of sequencing
This is not just about consumer choice; it is about timing. Digital economies tend to scale rapidly once key thresholds are reached. Network effects take hold, services expand, and new business models emerge, but only when access is widespread.
Uganda’s experience reflects a clear tension. Efforts to stimulate local production have not yet translated into large-scale adoption, and engagements between operators and local manufacturers remain ongoing, with limited volumes flowing through distribution channels.
The contradiction is clear. Demand cannot grow because prices are high. Prices remain high because scale has not been achieved. Scale cannot be achieved because demand is suppressed. The policy, in effect, risks defeating itself.
This does not mean the ambition is misplaced; it means the sequencing matters. Digital inclusion and industrial development do not have to be mutually exclusive, but they cannot be pursued in isolation from each other.
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