President Yoweri Museveni commissioning the Isimba hydro power dam in March last year in Kamuli District. Investment in infrastructure is expected to be one of the drivers of economic growth in Uganda
According to their latest report, Foresight Africa: Top priorities for the continent 2020-2030, only Senegal, Rwanda and Niger economies will grow faster than Uganda between 2020—2024.
The Brookings Institution, an American think tank, has projected that Uganda will be among the fastest-growing economies on the African continent in the coming decade.
According to their latest report, Foresight Africa: Top priorities for the continent 2020-2030, only Senegal, Rwanda and Niger economies will grow faster than Uganda between 2020—2024. The report projects that Uganda will grow by an average of 7.2% annually during the period. This is almost twice the Sub-Saharan Africa growth average of 3.9%.
Senegal is expected to grow the fastest at 8.3%, followed by Rwanda at 7.9% and Niger 7.3%.
Brookings did not make specific mention of what the drivers of Uganda's growth will be, but other economists point to the ongoing infrastructure investment, first oil and greater regional integration as the key drivers of growth in the coming years.
According to the Brookings Institution, Uganda was not among the top 10 fastest growing economies in Africa between 2015 and 2019. Mali was the 10th fastest at 5.4% while Ethiopia was the fastest at 8.7%.
The report drew mixed reactions from local economists.
Makerere University's Fred Muhumuza was sceptical about the projections and suggested they may be based on old data.
"They do not reflect our context. We have failed to get oil out of the ground for the last 15 years and we may not see the first oil for another five years. We are not seeing the promised improvements in our competitiveness that would come with our infrastructure development. Regional integration is being undone. Our revenue shortfalls are not a good sign of an economy turning around," Muhumuza said.
He acknowledged however that the opening up of roads has been beneficial to the economy.
"The investment in roads has improved access to markets and producing areas. This has stimulated quite a bit of economic activity. We have to wait and see where that momentum leads," he said.
Last year, the Uganda Bureau of Statistics (UBOS) rebased the economy, adding new components to the calculation of the economy. As a result, the economy grew 17% to sh128.5 trillion from the previous reported sh110 trillion.
Since the last rebasing of the economy in 2014, the industry's share of economic output has grown significantly as have non-traditional exports such as sugar, cassava and potatoes, state finance minister Gabriel Ajedra explained at the end of last year.
Ajedra said the Government was aware the benefits of the growth are not being equitably distributed but expected that the infrastructure developments would attract new investments, which will create more jobs.
The Brookings report outlines six priorities that African governments must urgently tackle for countries to meet the Sustainable Development Goals (SDGs) and guarantee prosperity for the continent.
The SDGs provide time-bound targets in key sectors, including health, education, employment, energy, infrastructure and the environment, for all nations to achieve.
"Nowhere is the need to achieve these targets larger than in Africa. While progress in some areas and countries is encouraging, overall, the region will need to redouble its efforts if it is to achieve the SDGs by 2030," the report says.
The first priority is ownership and domestication of the SDGs by countries in their national plans and strategies, and adapting them to the national context.
The report also proposes building systems to evaluate and monitor implementation of the SDGs, while the third area of focus revolves around building capacity to fight corruption.
The researchers also want governments to put in place policy reforms to improve the investment climate to attract private investment and improve tax administration to increase domestic revenues; and adopt measures to reduce tax evasion and illicit financial flows.
The report also presses African governments to tap into the African Continental Free Trade Agreement, touting it is as an ‘outstanding opportunity' to expand intra-African trade, investment and job creation.
The continental free trade area will commence in July 2020 and the report urges African governments to work together to accelerate the pace of its implementation with the involvement of the private sector.
The sixth recommendation by the researchers is for countries to do everything possible to tame the high unemployment rate, especially among Africa's young and fast-growing population.
"With rapid population growth and urbanisation, African leaders must fashion and implement policies to encourage job creation and maintain service delivery," the report reads.
It specifically entreats governments to invest in sectors primed to grow and create jobs, prepare young people for the jobs of the future, and improve the quality of living in Africa's rapidly growing cities.
Africa has a young and fast-growing population that is expected to increase from 1.3 billion presently to over 2.5billion by 2030.
Over 40% of the population is under the age 15 and 20% is between 15 and 24, presenting the potential for a demographic dividend, the experts observe.
However, to realise those gains, African governments need to invest more in increasing access to quality health and education services to guarantee a healthier and productive population.
The publication lists top priority areas for the continent, with proposals to policymakers on how to navigate potential obstacles. The report was prepared by a team of 28 international experts.
The researchers observe that Africa's economy is expanding at a faster pace than the global economy, with seven of the world's 10 fastest-growing economies in Africa.
The publication, however, takes note of key challenges the continent must contend with, including corruption, authoritarianism, food shortages, health crises, poverty and extremism.
In spite of the challenges, the experts see new commercial and diplomatic opportunities for Africa to empower itself from within and engage with foreign partners to grow.