Recent Uganda Economic Update forecasts place Uganda’s growth in the range of 3.5-4.0 percent in FY22 and above 5.5 percent in FY23. Neither prediction is much higher than the June 2021 estimate (UEU). Because of lockdown measures and a more severe second COVID-19 wave that hit in the middle of 2021, the FY21 recovery slowed dramatically at the start of FY22.
Even though development has begun since the commencement of the COVID-19 problem, the nation is still expected to have a stop-start recovery until the COVID-19 vaccine is widely available, according to the 18th UEU: Putting Women at the Center of Uganda’s Economic Revival.
“Quick deployment and better coverage of immunization is important to supporting an inclusive economic recovery,” according to the World Bank’s Uganda Country Manager. “Other positive changes include the start of school in January of 2022 and the prioritization of help for businesses with less than 500 employees. Budget and debt management that is rational and open for the long term are essential if we are to remain on track.”
Research shows that human capital development is at risk, especially in the education sector, which has been closed for the vast majority of the prior two years. Poverty and family vulnerability are on the rise, and disparities are widening as a result, according to the findings. Although Uganda’s third national development plan (NDP3) calls for per capita GDP to rise, some of the richest people in Uganda predict that even if economic prospects improve, the country would fall well short of the goal GDP level established in the NDP3.
As Uganda’s hard-won macroeconomic stability is put in jeopardy by a lack of openness around COVID-19, as well as the likelihood of weather-related shocks and the need to alter its government debt profile, the survival of COVID-19 is also in doubt.
Uganda’s Economy Is Growing
If given an equitable opportunity, Ugandan women might be a driving force behind economic recovery. However, this can only happen if commodity prices increase and digital technology and the digital economy continue to inspire new methods of working and conducting business. Ugandan women
UEU is focused on women’s economic empowerment this year, which is essential to a complete response to the immediate necessities of economic recovery and longer-term initiatives aimed at resolving the basic causes of gender inequality and fostering inclusive and long-term prosperity in the country.
Jennifer Solotaroff, Senior Social Development Specialist and co-author of the UEU, believes that putting more women in positions of productive economic activity would help the country’s economy recover faster, better, and longer.
Investments in women’s marketable skills and growth-oriented business help not just the women themselves but the whole Ugandan community as a whole, too.
What Are the Challenges For Development?
Despite the recent slowdown in average economic growth, structural change is to blame for the decline in poverty prior to COVID-19. As a result of the adjustment, agricultural output decreased, while industrial production, particularly agro-processing, grew significantly. Per capita, real GDP growth dropped from 2.2 percent between 2010 and 2015 to 1.3% in the five years before the COVID-19 crisis, but population growth increased to 3.7% per year, before the catastrophe As the 2016/17 drought showed, those living in poverty are more susceptible to natural disasters.
There has been a wave of company closures, long-term layoffs, a decrease in industrial and service sector activity, and a return of workers to agriculture as a consequence of COVID. Because of the country’s extreme poverty and lack of social safety nets, Ugandan households have seen their incomes fall. An influence on human capital development is possible, which is a worry given the country’s demographic change.
In order to maintain a low output, In addition to accounting for a quarter of the country’s GDP, agriculture accounts for half of its exports and two-thirds of its workforce. More than 75,000 jobs are needed each year to keep up with the growing workforce, compared to the current annual output of 700,000. It is also necessary to raise agricultural production and find ways of using extra labour in industry and services in order to further increase earnings.
As a result of Uganda’s poor Human Capital Index (HCI), today’s Ugandan youth would be 38% less productive than if they had access to adequate education and health care when they were young. Only 6.8 years of education will be completed by a four-year-old entering school, compared to the Sub-Saharan African average of 8.3. There are 4.3 “real” years of school, however 2.5 of those years are seen as “wasted” owing to a lack of educational standards in the United Kingdom. 83 percent of 10-year-olds are unable to read and comprehend a single paragraph by the time they leave elementary school. This is above the average for the region (80 percent ).
In addition, if the COVID-19 epidemic is not dealt with quickly and on a broad scale, recent gains in health and human capital development might be jeopardised.
Africa’s biggest refugee host and the world’s third-largest overall, Uganda now houses more than 1.4 million refugees. There is a great deal of demand on present infrastructure and service delivery in host communities, despite the country’s open-door refugee policy, which offers refugees access to social services, land, and jobs.
Watch this space for updates in the General News category on Running Wolf’s Rant.