Power tariff cut sparks new hope for Uganda’s manufacturers

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Uganda’s manufacturing sector is poised for a significant boost following a recent reduction in electricity tariffs, a move expected to lower production costs, attract more investment, and create employment.

The long-anticipated tariff adjustment, hailed by industry leaders as a game changer, is set to inject new momentum into local manufacturing as the country pushes for greater industrialisation and value addition.

Deo Kayemba, the outgoing chairman of the Uganda Manufacturers Association (UMA), said that for years they had requested President Yoweri Museveni to provide a tariff of at least 5 US cents per kilowatt-hour (kWh).

"This came to pass last week when the Electricity Regulatory Authority announced new end-user tariffs and granted us 5.5 US cents per kWh, which will reduce the costs of manufacturing and make our operations more profitable," he said.

He added that Uganda will soon begin producing its own steel and tin using iron ore reserves in Kigezi.

Uganda, which has been importing iron and steel worth $500m annually despite having large deposits of iron ore, is now shifting focus to developing its local industry. The country's steel consumption per capita is around 15 kgs, which is below Kenya's 45 kilograms and the world's average of 250 kilograms.

Incoming UMA chairman Aga Sekalala Jr expressed his readiness to serve the remaining one year of Kayemba’s term.

Kayemba served only three years of his four-year term. UMA is a body that brings together over 3,000 members.

Dr Ezra Muhumuza Rubanda, the UMA executive director, disclosed that the association is soon to get a new home. He said President Museveni has promised to provide a piece of land outside Kampala for the construction of a new secretariat and exhibition centre.

Headquartered at Lugogo, UMA—renowned for hosting the annual international trade fairs—is now in need of a larger exhibition space.