UDC close to revival, to be recapitalized with sh500b

Parliament has approved the Uganda Development Corporation (UDC) Bill 2014, paving way for the revival and capitalization of the Uganda Development Corporation as a body corporate.

UDC will once again act as the fulcrum of industrialization and will be an investment agency on behalf of the Government of Uganda in partnership with the private sector; to catalyze and promote industrial and economic development of Uganda.

Government took a decision to re-establish UDC in 2008 to be the overall government arm for all public investments in all sectors, with a mandate to invest in strategic sectors of the economy to trigger the industrial and economic development of Uganda.

In 2012, Cabinet decided that the UDC be revived to drive industrialization and approved the principles for establishment of UDC as a Statutory Corporation. Cabinet directed the Ministry of Trade, Industry and Cooperatives to draft the UDC Bill which was done and completed in September, 2013.

First established in 1952, UDC was the main driver of Uganda's industrial and economic development in the 1960s and 1970s. By 1971, UDC had 36 subsidiaries and 22 associated companies.

UDC had spearheaded the establishment of multiple government led investments including but not limited to entities like DFCU bank, the Uganda Hotels, Kakira Sugar Works, Kinyara Sugar Works, Steel Rolling Mills, Hima Cement, Tororo Cement,  NYTIL Jinja among others.

Governments interest in these investments was eventually divested in the wake of the privatization and economic liberalization policy which saw the demise of the 1952 UDC- some of the investments have continued to thrive.

The new law (to be called the UDC Act 2016) now seeks to empower UDC to undertake similar commercial ventures on behalf of the Government.

The revival of UDC was conceived under the stewardship of the Cabinet and the Ministry of Trade, Industry and Cooperatives following which the Government took a decision to revive UDC in 2008.

The UDC Bill 2014 was finally passed into Law by Parliament on 2nd March 2016 and only awaits Presidential Assent.

Despite it's hitherto limiting legal status, yet driven by the overriding need for the Government to intervene in the promotion of certain investments and sectors, the institution has not been idle since its revival in 2008.

UDC has continued to demonstrate the urgent need for Government intervention in the business space -particularly in areas where the private sector shies away either due to low returns in the immediate foreseeable future or due to initial heavy capital requirements  yet such sectors/investments offer strategic benefits in spurring development of other sectors.
 
So far, UDC is handling a $10m (about sh34b) into the establishment of the Teso Fruit Factory on behalf the Government of Uganda in partnership with the Government of the Republic of South Korea through KOICA.
 
The UDC has also invested into the Kalangala Infrastructure Services through a PPP framework with other development partners. UDC is a co-investor in a four-component Infrastructure Company in Kalangala providing electricity (generation and distribution), piped water, quality and reliable ferry services and a good road to the inhabitants of Kalangala.
 
UDC is also involved in the establishment of a fruit processing factory in Luwero which will provide a stable market for the abundant good fruit available in the greater Luwero region.
 
Working hand in hand with the KIIRA EV Project team, UDC is supporting innovative breakthroughs in the automotive space; this will lead to the birth of the first ever automotive manufacturing /assembly establishment in Uganda and the region in partnership with a leading automotive player.
 
Other initiatives under consideration are the establishment of a Cement Factory in the Karamoja region; Iron and Steel Plant; Sheet glass Manufacturing Plant; Ten other zonal agro-processing facilities in Uganda including the manufacture of tea; and, Investment in a Tourism Project that will catapult the gains yielding in the tourism sector owing to a wider product mix that the project will provide.