Uganda’s $500bn ambition puts factory costs and raw exports in focus

Some Ugandan-made goods are sitting in warehouses because their producers lack space to display them to buyers, the Uganda Manufacturers Association says. That bottleneck sits alongside a much larger ambition: expanding an economy the government values at about $50bn to $500bn by 2040. At the Uganda International Trade Fair in Kampala, President Yoweri Museveni called for a shift from exporting raw materials to making higher-value products, according to The Independent Uganda (direct).

Trade, Industry and Cooperatives Minister Sanjay Tanna delivered Museveni’s speech at the opening of the 32nd fair. The president said Uganda and Africa had spent decades losing economic opportunities by selling unprocessed resources abroad and buying finished goods back. He urged investors to build a production base that creates jobs, raises export earnings and relies more on technology and innovation.

From raw resources to finished products

Museveni’s priority list stretches from agricultural processing to industrial materials and advanced manufacturing. He named fruit processing, animal feeds, cassava and banana flour and starch, ethanol and paper, alongside steel and copper processing. Fertilisers, vaccines, pharmaceuticals, diagnostics, vehicles and electronics were also identified as areas for investment. Tanna said the fourth National Development Plan, or NDP IV, which began in 2025, was intended to advance industrialisation, production and investment. He acknowledged the scale of the 2040 goal but said recent economic developments had increased the government’s confidence.

Manufacturers backed the case for processing more at home, while setting out the support they want. UMA board chairman Aga Sekalala Jr said the association had expanded from 26 companies when it was revived in 1988 to 1,737 members. He said manufacturers account for 16.5% of gross domestic product—the value of goods and services produced in the economy—and 30.3% of national tax revenue. His argument was that selling more raw exports would not deliver a tenfold expansion.

“It grows by finishing things,” said UMA board chairman Aga Sekalala Jr.

Sekalala asked the government to fund the fair as a national trade platform, provide predictable industrial electricity prices and reliable power, and improve access to affordable long-term credit. He also pressed for public procurement—government purchases—to favour local manufacturers. Cement, steel, cables, pipes, paint and furniture needed for public projects could come from Ugandan factories, he said.

Manufacturers press for working capital

Abid Alam, chairman of UMA’s advisory council, warned that Middle East conflict, unstable energy prices and transport disruptions were increasing costs for factories reliant on imported fuel, materials and machinery. Shipment delays could stop production, while higher costs of bringing goods into the country could wipe out profits, he said. Alam also cited a widening fiscal deficit—the gap between government spending and revenue—from 4.7% of GDP in 2023/24 to 6% in 2024/25, which he said was squeezing public investment and business credit.

Alam called for timely government payments, faster value-added tax refunds and consistent tax treatment to release money for factories’ daily operations. Separately, UMA executive director Dr Ezra Muhumuza requested more exhibition land, saying the Lugogo grounds could no longer accommodate the growing number of manufacturers.

The 10-day fair runs until October 11, with more than 1,000 exhibitors and about 150,000 visitors expected, according to organising committee chair Regina Namuwonge. Beyond the displays, the next issue to watch is how the government responds to manufacturers’ requests on electricity, financing, payments and local purchasing as it pursues its industrialisation plan.