Uganda is the second largest landlocked economy in Africa after Ethiopia. It is also among the top 15 economies in the continent.
The country shares borders with South Sudan, DR Congo, Tanzania, Kenya and Rwanda. It is a major player in the Great Lakes region of the East African Rift Valley. It lies right on the equator with its concomitant tropical climate.
Uganda has important natural resources like copper, gold, tungsten, cobalt, columbine-tantalite, phosphate and others. It has fertile lands and the second largest surface area of Lake Victoria, the largest natural lake in Africa. It has the second-largest population for a landlocked country.
According to the African Development Bank, (ADB), the East African country’s economy grew at 6.3 per cent in 2022 and is expected to end 2023 at 6.5% or more. This was impressive considering the inimical effect of COVID-19 and the Russia-Ukraine conflict on various economies during the period. Even in 2021, Uganda expanded its economy by 5.6%. This was backed by robust agriculture and services sectors. It is estimated that the economy would expand at 6.7% in 2024.
As of the end of 2022, the Uganda economy was at almost $50 billion and was the 13th largest in the continent. This was manned by about 48. 3 million inhabitants. The youthful population provides positive market prospects domestically and for multinationals.
In recent times, the discovery of significant hydrocarbons in the western regions has further boosted the country’s economic prospects. It is expected to produce about 230,000 barrels of oil each day starting in 2025.
Security issues:
Until recent years, Uganda has faced diverse security threats that involve multiple actors. These have included Christian and Islamic extremists, secular rebellions and transnational sub-states sub-state actors.
The country’s location in the restive Great Lakes region had further put it in a volatile situation. It is also in a geopolitically ambiguous region. It is a member of the Horn of Africa's IGAD and the East African Community.
In recent times, however, the country’s security has significantly improved, partly as a result of strong security institutions and strategic security partnerships. Other Issues securitized in Uganda include political stability, border security, stability in the region, environmental degradation and other natural concerns of a landlocked country.
Verdict:
Despite very recent terror threats and political protests that plagued the country, especially after the last general elections, Uganda’s impressive economic performance in recent years makes it a positive market to put your money in. This notwithstanding, the removal of bureaucratic hurdles and transparency must be encouraged to make it more market friendly. The risk is medium.
