Standard Chartered Bank Uganda organized a Manufacturers’ Business Forum for over 150 manufacturers’ and various stakeholders with the aim of providing a platform for market players to network, share forward-looking insights and best practices.
Industry

Delay in Uganda’s Final Investment Decision will affect the economy

Standard Chartered Bank Uganda organized a Manufacturers’ Business Forum for over 150 manufacturers’ and various stakeholders with the aim of providing a platform for market players to network, share forward-looking insights and best practices.

The forum themed “Practices for Sustainable Business Growth” brought together subject matter experts and leading manufacturing businesses to deliberate on current trends affecting business growth in Uganda as well as share the latest research on important and policy-relevant topics.

This engagement granted an opportunity to the Bank’s clients to learn, engage, network and be empowered to improve their operating environment.

While addressing the participants, Eva Wanjiku Otieno Africa Strategist, Standard Chartered Bank presented the Macroeconomic & Global Geopolitical Outlook.

She highlighted Uganda’s mixed growth outlook supported by public investment in infrastructure. However, she said, the delay of the Final Investment Decision (FID) and upcoming elections would weigh on business prospects.

Wanjiku also emphasized the Central Bank policy rate being at a historically low level due to subdued inflation which allowed for past BoU easing.

She further discussed the various factors underpinning the USD-UGX performance and highlighted external vulnerabilities including the widening current account deficit.

Wanjiku stated that Election-related uncertainty may increase supply concerns going into the second half of 2020 which may pressure yields higher.

About the economic growth prospects of Uganda, Wanjiku said the government’s effort to invest in infrastructure will begin to pay off.

“We’ve seen Uganda’s growth being one of the best in East Africa, at 6% economic growth forecast for 2020, one of the supportive factors would be the investments that the government has done in infrastructure which will start to pay off, the quite robust private sector mainly due to the accommodative monetary policy by the bank of Uganda and keeping the policy rate steady.”

“The manufacturing sector’s contribution to the growth of the economy on basis of the exercise doubled from 8% – 16%, the industrial sector increasing from 20%-30% which shows that the investment which the government has been doing through the NDP II has started to bear fruits.”

Wanjiku urged the government to set focus into the Agro-processing industry since agriculture is one of the widest employers citing about 75,000 jobs that are available in that particular sector that would employ at least a number of the 600,000 Ugandans that graduate every year.

“They’ve been some risks as well for example the delay in the final investment decision that happened last year which many money participants had banked on and also the border closure between Rwanda and Uganda whom we well know are trading partners that may play some downside risks to the economy,” Wanjiku noted.

Albert Saltson the Chief Executive Officer, Standard Chartered Bank Uganda said this new decade presents immense opportunities for business growth.

“It is critical that business leaders make insight-led and research-based business decisions in partnership with strong and reliable financial partners who will help them stimulate their business growth.”

“At Standard Chartered Bank we are committed to spearheading industry discussions on pertinent issues as part of our commitment to sharing our knowledge, expertise and best practice with the Ugandan market.”

“We will remain a trusted business partner by always delivering sustainable value and growth by leveraging our Global research and on-the-ground networks and expertise to deliver key economic data, trends and views.

“Today, we are very pleased to share insightful, relevant research findings, analysis and incisive views to inform, advise and have ongoing discussions with you as our clients and market players,” Saltson added.