Kampala, Uganda | THE INDEPENDENT | Businesses seeking to export goods and services under the Africa Continental Free Trade Area (AfCFTA) arrangement have been advised to embrace technology for high-quality products.
AfCFTA, which has a market base of 1.5 billion people, has been touted as a game-changer for economies like Uganda, as it promises larger market opportunities, triggering more trade and investment and allowing greater value addition, export diversification and productivity growth – leading to more and better jobs with greater social inclusion.
The Chief Executive Officer of Private Sector Foundation Uganda, Stephen Asiimwe, says that Uganda is competing with 53 other countries under one single market, and as such needs technology to enhance efficiency and deliver goods of high standards and on time.
Giving an example of a pineapple from the farm that has a shelf life of five days without refrigeration, Asiimwe said exporters must invest in refrigeration services to keep the pineapples fresh, juicy and safe for consumers. “Alternatively, invest in value addition by sun-drying or packaging juice,” he advised.
Africa accounts for just 2.9 per cent of global trade and only about 17 per cent of African exports are intra-continental, compared to 58 per cent for Asia and 65 percent for Europe. However, limited knowledge and understanding of the free trade area remain a huge challenge to the successful uptake of trade opportunities within the newly created one African market.
Uganda is facing a number of challenges in exploiting opportunities under ACFTA. These include high-interest rates, unfavourable tax policies, quality standards, poor dispute resolution mechanisms, insecurity, low digitalization levels and the inability of key institutions to identify opportunities and link them to entrepreneurs and limited support to boost quality productions.
“If you are selling cement, a kilo is a kilo. It must be well packaged, clean and safe. A bag of cement is 50 kilograms, not 45 kilograms and should contain the real ingredients, not sand. If you promise to deliver a product, be reliable and efficient. Deliver services on time. If you say you are a lawyer, you must be one. We need to stop being bafere (conmen),” the PSFU boss emphasized.
The discussion came up as PSFU, in partnership with the United Nations Development Programme-UNDP started a mass awareness campaign to promote the AfCFTA and strengthen the capacities of export-ready enterprises in Uganda.
The AfCFTA, which went into force in January 2021, was created to form a single market for goods and services on the African continent, which allows for the free movement of persons and investments. Asiimwe said Ugandan businesses need to invest in high-quality human resources to be competitive in the free trade area.
“For professional services, we need to invest in good quality services. We must ensure that people work on time, are efficient, and reliable. People should invest in learning several languages such as French and Kiswahili,” he advised.
PSFU is providing technical support to equip 250 export-ready enterprises in Uganda with knowledge, skills and tools to enhance their ability to access regional and continental markets. Asiimwe said PSFU is engaged in advocacy work, especially with government agencies such as the Uganda Revenue Authority, Ministry of Trade, Immigration and Foreign Affairs to facilitate regional trade.
“We are engaging the government to lower telecom rates, build industrial zones near the borders, put business-oriented people in consulates, provide power and good infrastructure to help people to the business. We are working with Uganda Tourism Board (UTB) to create trade fairs to promote local products and services. We want to get people in the entertainment industry to go outside in the region to make money,” he said.
“We have Uganda Airlines making three flights to Kinshasa per week. The government is building new roads in DR Congo. On our side, we are doing market intelligence to ensure we exploit these markets and people do not get stuck with these things which won’t sell.”
Private Sector Foundation Uganda (PSFU) is Uganda’s apex body for the private sector. It is made up of over 200 business associations, corporate bodies and the major public sector agencies that support private sector growth.