The UN’s Food and Agriculture Organization (FAO) has determined that Uganda’s fertile soil can feed roughly 200 million people. According to the audit report, 80% of Uganda’s land is arable, but just 35% is being used for farming. Agriculture accounts for approximately 23.7% of the country’s GDP and 31% of export revenues in the 2020/21 fiscal year.
Uganda is known for producing various agricultural commodities, including plantains, cassava, beans, corn, sweet potato, fish, tobacco, millet, groundnut, edible oil, tea and coffee, as listed by Trading Economics.
Investors consider Uganda’s agricultural potential to be among the finest in Africa, owing to the country’s low temperature variability, fertile soils and two rainy seasons, which results in abundant crop harvests annually, according to the report.
Lack of quality packaging capabilities, limited storage facilities, poor post-harvest handling methods, a lack of agricultural credit and excessive freight costs all impede sector expansion.
Farmers’ inadequate use of fertiliser and quality seeds, as well as a lack of irrigation infrastructure are preventing commercialisation of the industry, according to the report, making production subject to climate extremes and pest infestations.
Economy is bouncing back
Meanwhile, the Ugandan Development Bank Ltd (UDB) has authorised projects, which come to a total of Shs926 billion throughout the Covid-19 pandemic. Of this, Shs589 billion has been disbursed into the Ugandan economy to boost businesses.
The government, through UDB, is prioritising growth through localised value addition, production and import replacement in line with the National Development Plan III, and this disbursement constitutes the greatest investment in the country’s post-Covid recovery effort.
“At the onset of the pandemic, the government implemented a raft of measures to support the resilience and a faster recovery of the country’s economy. As part of these measures, the government committed to capitalize UDB with shs1 trillion; out of which Shs585 billion was extended to the bank as part of additional funding,” said Patricia Ojangole, managing director of the ank via an International Monetary Fund report titled “IMF Policy Responses to Covid-19”.
“Of the shs585 billion, sh455 billion was to be deployed to support the economy to be self-sustaining during the pandemic and was extended to the three key economic and productive sectors of primary agriculture, agro-industry and manufacturing.
“There is evidence that indicates that the economy is responding well despite the conditions brought on by the pandemic, a trend that is likely to continue now that the economy is being fully opened,” she added.