Calls for stronger local content policies in East Africa’s oil sector

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The Uganda Chamber of Energy and Minerals (UCEM) has reaffirmed its commitment to bolstering private sector involvement in East Africa’s petroleum industry through the development of local content, skills enhancement, and policy advocacy.

During the 11th East African Petroleum Conference and Exhibition (EAPCE) in Dar es Salaam, UCEM CEO Humphrey Asiimwe stressed that local content is key to achieving sustainable growth within the oil and gas sector. The conference took place from March 5-7, 2025.

Asiimwe emphasised that leveraging the petroleum industry to drive industrialisation, create jobs, and strengthen economic resilience is essential for the region’s future.

“As a region, we must harness the full potential of the petroleum sector to fuel industrialisation and economic progress,” Asiimwe said.

“Uganda has made significant strides in promoting local participation, but there is still much work to be done to harmonise regulations across East Africa and unlock financing opportunities for small and medium enterprises (SMEs)."

UCEM, formerly the Uganda Chamber of Mines and Petroleum, has been instrumental in advancing local content initiatives by fostering dialogue, influencing policy, and promoting collaboration between the private sector and the government.

Asiimwe highlighted key milestones, such as the substantial growth in local procurement, where Ugandan companies have secured 4,511 contracts worth a total of $2.1 billion out of a $5.3 billion oil and gas procurement pool. Over 15,169 jobs have been created, with 90% of these positions filled by Ugandan nationals, including 4,773 from host communities.

Additionally, more than 7,000 Ugandans have received training in petroleum industry-related fields, reducing dependence on foreign expertise.

The private sector has also contributed to more than 50 community projects in education, healthcare, and infrastructure, reinforcing its social licence to operate.

While Uganda’s Petroleum Act of 2013 mandates foreign firms to prioritise local sourcing and employment, Asiimwe called for the standardisation of local content policies across East Africa to create a more predictable investment environment.

“Policy fragmentation impedes business expansion and cross-border collaboration,” he noted. “UCEM is working closely with the East African Business Council and regional chambers to advocate for more aligned regulations that will create a consistent and welcoming investment climate.”

Asiimwe highlighted the importance of accelerating the operationalisation of Uganda’s National Content Fund, which was approved by the Cabinet in 2024 but remains inactive.

Given the country’s average lending rates of 20% per year, he urged the adoption of alternative financing solutions, such as credit guarantees and lower-interest funding, to support local suppliers.

As global Environmental, Social, and Governance (ESG) standards become more important, Asiimwe emphasised the private sector’s role in promoting sustainability within the industry.

“The private sector is at the forefront of ensuring that oil and gas projects adhere to ESG standards,” he said. “Increased corporate social responsibility (CSR) initiatives and effective compliance monitoring will strengthen the industry’s reputation and promote long-term sustainability.”

To ensure continued progress in local content development, Asiimwe proposed several recommendations, including increased investment in specialised training institutions and the expansion of internship programmes.

He called on regional governments to align local content frameworks to enhance investor confidence and urged more rigorous monitoring of sustainability policies and CSR efforts.

In addition, he emphasised the need for greater integration of local companies into global supply chains and for removing financial barriers that currently hinder local business participation.

Asiimwe further advocated for regional integration of local content policies, proposing a tiered approach to procurement. Under this model, local content would be prioritised at the national level (Tier 1), but if a qualified national company is unavailable, the opportunity should first be offered to regional firms (Tier 2) before considering international alternatives.

Additionally, he stressed the importance of facilitating cross-border mobility for skilled labour to further boost regional collaboration.