Investors warned against mortgaging govt land

The government will not allow investors to mortgage land that has been leased to them for production, the state minister for investment and privatisation, Evelyn Anite has said.

While meeting a section of local investors in Kampala on Friday, the minister said the government had rescinded its position on the matter and resolved not to allow such a practice.

The meeting was convened to share opportunities and incentives available to local investors, in the wake of complaints that the government was paying more attention to foreign investors.

"We will not allow you to mortgage land offered to you by the government because of the risks that come with it," Anite told the business delegation.

She also said the government would no longer approve licenses for any investor to operate in an area gazetted as a wetland, over concerns about environmental degradation.

The meeting was attended by business personalities with interests in agro-processing, real estate, tourism, manufacturing, energy and education, among other sub-sectors.

At Namanve Industrial Park, for instance, there are 190 local investors, compared to 101 run by foreign investors. Local investors are also employing more Ugandans compared to foreign firms.

Byensi explained that companies that produce for export (at least 80% of their produce) can benefit from ten-year tax holidays while agro-processing firms can enjoy income tax exemption.

Firms that import agricultural equipment and inputs including tractors and fertilizers qualify for exemption from paying value-added tax (VAT) while those who invest in four priority sectors (ICT, agro-processing, tourism and minerals processing) can receive from subsidized land.

Anite who chaired the meeting at the finance ministry's head offices rallied investors to tap into the opportunities.

"It is perceived that the government pays more attention to foreign investors. You have seen us with Chinese, Indians or Americans. But we love you more than we love them," she told the meeting.

Some of the manufacturers complained about the high costs of product certification, access to finance, stringent approval processes and inadequate information from relevant institutions.