Tuesday , August 9 2022
Home / Business / Private sector tasks government on favorable policies

Private sector tasks government on favorable policies

Finance Minister Kasaija

Kampala, Uganda | THE INDEPENDENT | Private sector players have charged government to implement policies that support recovery of businesses especially in the midst of the pandemic.

The second wave of the COVID-19 pandemic in Uganda continues to threaten the economy as infection rates rise to 77,505 and reported deaths reach 868 as of June 29, 2021. The 42-day lock down that has pushed many Ugandans to stay home has cut many from their sources of livelihoods as well as disrupted normal operation of crucial businesses.

These combined have led to contractions in investments due to induced uncertainty in consumption, rising levels of income poverty leading to reduced domestic demand, projected rise in non-performing assets especially for Micro, Small and Medium Enterprises and reduced employment creation potential of the economy especially salaried jobs.

Private Sector Foundation Uganda (PSFU) in partnership with The Innovation Village, Uganda Tourism Association, Uganda Healthcare Federation and Mastercard Foundation today, organized a virtual public-private policy dialogue under the theme “COVID-19 implication on life, business and jobs: Reflection on the FY2021/22 National Budget” to share ideas on how best government and the private sector can work together to rebuild the country’s economy.

Matia Kasaija, the Minister for Finance, Planning and Economic development said the budget for this financial year continues to focus on interventions which counter the socio-economic recovery. In line with the budget, the most immediate priority for government is vaccination with a target to vaccinate at least 22million people. It is only then that the country can fully reopen the tourism, entertainment and creative sectors.

Kasaija said, “In this financial year, government is focusing on strengthening the health care system to be able to deal with future healthcare emergencies through improving health worker skills and working environment, provision of personal protective equipment. There is also a plan to increase funding to enhance the welfare of health workers and recruitment of more personnel.”

Government will also continue to support the advancement of scientific research and innovation.

“We believe that focus on digital transformation will enhance the socio-economic transformation and improve efficiency and productivity. This include the extension of the national ICT infrastructure coverage up to the sub-county level, enhance usage of ICT in national development and service delivery, and strengthen the policy, legal and regulatory framework,” he said.

Joining the discussion via zoom, Patience Byaruhanga, Lead Agriculture at the Mastercard Foundation said the crisis is a reminder of how important concerted efforts are towards tackling the pandemic.

“In 2020, the Mastercard Foundation launched a COVID-19 Recovery and Resilience Program to support health workers and first responders with protective equipment. To enhance economic recovery, we partnered with the private sector to expand access to financial services for micro, small and medium enterprises, enable e-learning so that young people continue to study as well as supporting the adoption of digital solutions to address the urgent needs of the people. We have also purchased 12million vaccines to support governments’ vaccination programs throughout Africa,” Byaruhanga said.

According to Japheth Kawanguzi, Team Lead at The Innovation Village, to fully revive the economy and ensure businesses become resilient against the third or fourth wave of Covid-19 pandemic, there is need to incorporate technology and innovation into businesses, offer financial relief to start-ups, and create policies that provide favorable environment for entrepreneurs to walk the business journey.

The COVID-19 pandemic, in his view, has exhibited the need to leverage technology in key economic sectors to drive economic transformation and growth.

“Today, the Internet has become an engine for entrepreneurs to start businesses online, a platform for start-ups to market their business and a facilitator for creative and innovative ideas,” Kawanguzi said.

He added, “By putting a 12 per cent excise duty on internet bundles, we are sacrificing long-term gains for short-term needs. The Start-up ecosystem is still young and needs full government support in form of good policies, massive funding to accelerate their businesses. A favorable investment environment can help government grow its tax base.”

Francis Kisirinya, the Acting Executive Director of the Private Sector Foundation Uganda while presenting the private sector report to government said the organization continues to engage government agencies to develop favorable policies for the sector to thrive. Most efforts made are yet to bear fruit especially on the taxation policies.

“We recommended that the digital tax stamp for manufacturers be reduced in this financial year. However, this was not addressed by government. Although, Over The Top (OTT) tax on social media was removed, the government introduced a 12 per cent tax levy on internet bundles. This is a big hindrance on digital transformation, innovation and attainment of a fully digital economy,” Kisirinya explained.


Leave a Reply

Your email address will not be published. Required fields are marked *