KACITA advises on balance of trade
Feb 25, 2016
Kayondo said that since Uganda’s comparative advantage is in agriculture, government should place more emphasis on the development of the sector, to raise exports and balance the country’s trade sheet.
A consortium of traders, under their umbrella body, the Kampala City Traders Association (KACITA) has called upon government to put more emphasis on agro production and processing to improve the country's balance of trade.
"The dollar is now high because of speculation arising from the election period and our negligible export volumes. However, if we had enough to export as a country, we wouldn't be affected this much. The high dollar is bad for our businesses," said the KACITA chairman, Everest Kayondo during a trader's business meeting in Kampala o.
Kayondo said that since Uganda's comparative advantage is in agriculture, government should place more emphasis on the development of the sector, to raise exports and balance the country's trade sheet.
Agriculture contributes approximately 22.5% to the gross domestic product (GDP) and provides employment to more than 80% of the population, according to records from the National Bureau of Statistics.
"Even the industrial sector here is agro-based, accounting for at least 40 % of total manufacturing, and that is why we want government to focus on its development including increasing the budget," Kayondo noted.
Maize is one of the crops grown in Uganda
According to statistics from the finance, the trade deficit in goods and services has almost tripled since 2005/06, from $1 billion (sh 3.5trillion) in that year, to nearly $3 billion (sh10.69trillion) in 2014/15.
According to the country's Vision 2040, Uganda aims at becoming a middle income country, with significantly reduced unemployment and a robust industrial sector.
However, the bulk of the workforce, according to KACITA, will likely remain employed in the agricultural sector.
"In the past, a lot of lip service has been applied to the agriculture sector and nothing has been done. We believe that in the coming five years, Uganda is destined to grow exponentially and that is why government should be practical," said the KACITA vice chair, Isa Ssekitto.
Ssekitto added that finance now remains a key stimulous in developing profitable agriculture value chains and addressing issues of production planning and management, processing and marketing.
He said the key to economic transformation is the development of a dynamic and productive farm economy.