TOP
Wednesday,September 30,2020 10:34 AM

Boost local investments

By Vision Reporter

Added 29th April 2013 03:16 PM

This week the business sector has experienced two gross shake-ups; Warid telecom being seized by rival Bharti Airtel, the second leading telecom company in the country, and DFCU Bank suspending its trading on the stock exchange following a major shareholder’s decision to sell off his shares.

This week the business sector has experienced two gross shake-ups; Warid telecom being seized by rival Bharti Airtel, the second leading telecom company in the country, and DFCU Bank suspending its trading on the stock exchange following a major shareholder’s decision to sell off his shares.

By Nsanja Patrick

This week the business sector has experienced two gross shake-ups; Warid telecom being seized by rival Bharti Airtel, the second leading telecom company in the country, and DFCU Bank suspending its trading on the stock exchange following a major shareholder’s decision to sell off his shares.

One advantage of a sound economy with a vibrant private sector is stability. This stability translates into stable jobs, generation of employment opportunities, growth and productivity.

Recent trends in Ugandan companies indicate that something is amiss with the country’s private sector. There is less stability as companies are frequently transferring ownership and others voluntarily suspending trading on the stock exchange. Others are being hit by tax defaults.

A country’s Gross Domestic Product (GDP) highly depends on its gross investments among other factors. A GDP OF 4.1 for a state as old as Uganda (50 years), blessed with a multitude of resources and a big population speaks volumes of the dire need for local investments consolidation.

Although GDP doesn’t depend on local investments only, but also important to understand is the fact that the volume of investments culminates into production, which accounts for a country’s exports and products for local consumption. Less investment into the Ugandan economy have rendered their population more of a liability than an asset to the government, yet worse still is that the greatest percentage of its people are minors and youth.

The Government of Uganda has often preferred to promote foreigners to come and invest at home owing to the lack of huge sums of money required to invest, but this has implications of exploitation that come with it in form of profit repatriation and employment of non-Ugandans in well paying positions. Furthermore, it has under looked the fact that these foreign investors and manufacturers would still depend on the local population as primary consumers of their products and as such an unproductive poor low consuming population would not sustainably support investments whether foreign or local.

A vibrant economy requires immense investment by the government in its people through healthcare, education (to improve the productivity of its labour force) in infrastructure, technology advancement among others.

It has been pointed out in the recently launched Vision 2040 that Uganda has often been challenged by the lack of a clear ideological direction and national value system. This is a very good observation that has to be addressed immediately owing to the fact that outstanding economies thrive on clear models and directions. Our country has subscribed to several western economic policies without deeply studying their models and implications.

For instance, liberalisation of the economy as a reform has simply taken the responsibility of developing countries towards their citizens off their shoulders to a capitalist. In my opinion, some developing countries like Uganda needed to grow to a certain stage before adopting such reforms totally because their people were still highly impoverished and desperately needed government intervention. In some western countries like Britain and the US, Islamic banking is steadily taking its toll owing to the loopholes in western banking that has been deemed exploitative, but for poor countries like Uganda, where such interventions are much more needed, authorities have not been pro-active.

We, therefore, urge the government to intensify efforts to boost local investments and the business sector because it is the fountain of growth and has a strong bearing on the country’s Gross Domestic Product. Such efforts should also go hand in hand with critical monitoring and documentation to establish the productivity of the amount of money invested in terms of job creation and implication on the overall GDP and per capita income.

Hon. Nsanja Patrick

MP Ntenjeru South Constituency

Boost local investments

Related articles

More From The Author

More From The Author