Uganda is an East African country with its capital city in Kampala. It covers about 236,040 km2 of dry land and about 36,330 km2 of water. The country has a population of about 44 million people. Uganda is a landlocked country bordered by Kenya, Tanzania, South Sudan, Democratic Republic of Congo (DRC), and Rwanda. The country’s GDP as of 2017 was USD 25.89 billion which represents about 0.04% of the world’s economy. The major contributors to the economy of Uganda are discussed below:
Tourism and travel industry is a fast-growing industry in Uganda. It contributes to about 9-10% of the country’s GDP. The sector has employed over 600,000 people working either as tour guides, drivers, secretaries, translators, and security personnel among other jobs. It has also improved the livelihoods of the locals who sell beautifully hand-made African jewelry, clothes, hats, bags, and many other items. The warmth and hospitality of the people of Uganda have promoted the tourism industry.
Uganda has several tourist attraction sites such as the magnificent scenery of the plains, highlands, mountains and lakes, natural parks and game reserves with a variety of wildlife, and flora and fauna. Statistics indicate that the number of tourists has increased in the past six years from about 1.1 million in 2012 to 1.8 million in 2018. More specifically, the tourist destinations in Uganda include Queen Elizabeth and Murchison Falls National Park for game watching, Mount Ruwenzori which is popular for mountaineering, and River Nile (for bird watching, water rafting, and kayaking). Other tourist sites are Lake Victoria and Lake Albert for sport fishing and boat riding, as well as game viewing of mountain gorillas at Bwindi and Mgahinga National Parks.
Transport promotes local, regional and international trade. Thus, a good transport network in a country facilitates the growth of the economy resulting in the generation of revenue for government expenditure and investments. The road is the major form of transport used in Uganda as it has a total road network of about 140,000 kilometers long. The roads not only connect major towns and trading centers in Uganda but also link the country to her East African neighbors, promoting regional trade. Another form of transport used in Uganda is rail transport which is about 1,260 kilometers long. However, according to the 2015 reports from the Ministry of Works and Transport in Uganda, only about 705 kilometers of rail transport is operational. The railways are largely used in the transport of large cargo across the country.
Air transport in Uganda has also contributed immensely to the economy, especially the tourism industry. In the year 2007, there was an upgrade of the Entebbe International Airport to meet the international standards. As a result, the number of tourists and cargo capacity has increased leading to improved regional and international trade. The airport is situated 34 kilometers from the country’s capital of Kampala. Uganda has no port. It only relies on the inland water transport system which covers navigable lakes and rivers. Transport on these water bodies takes place by use of water vessels such as boats, ferries, and canoes. They transport people and goods to trading centers. Lake Victoria links Uganda to Kenya and Tanzania. On the other hand, Lake Albert is shared between DRC and Uganda. In conclusion, motorcycles dominate the transport system of Uganda forming about 50% of all the transport services followed by passenger vehicles (buses, minibuses, and cars) at 30%, light good vehicles at 12%, heavy commercial vehicles at 6%, and agricultural tractors and the rest at 2%.
The fishing industry has been very significant to the economy of Uganda. It is the second highest foreign exchange earner in the country after the tourism industry. The fishing sector employs over 700,000 people in fish related activities such as local and industrial fish processing, research and development, sale of fishing gears and equipment, builders of boats, weavers of fishing nets, and the actual traders involved in the fishing business. Water bodies in Uganda cover 18% of its total surface area. The two main sources of fish in the country are lakes and rivers which account for approximately 461,000 tons of fish per year. Fishing practice by aquaculture produces about 111,000 tons of fish.
The presence of many freshwater lakes such as Lake Victoria, Lake Albert, Lake Kyoga, Lake Edward, and Lake George has boosted the fishing sector. There are also a variety of fish species totaling to 350 and ready markets for the fish both locally and internationally. The most common fish species are Nile perch and Tilapia which form 46% and 38% of exports respectively. Other fish types include clarias, silverfish, lungfish, catfish, sprat, eels and Singidia tilapia which are mostly sold and consumed locally.
The manufacturing industry accounts for about 21% of the GDP and has created job opportunities for almost 7% of Uganda’s labor force. Most of the manufacturing industries are foreign. Some factors that influence the location of these industries include; raw materials, fuel, and power, labor, markets, land, water, government influence, and transport. A good number of these industries require raw materials from agricultural products such as coffee, tea, nuts, dairy products, fruits, and vegetables.
Oil And Mining Industry
Uganda has valuable minerals like tin, copper, gold, iron, cobalt, and even cement. These minerals are exploited for their economic value. A gold processing unit was established in Kampala in 2017 to ensure maximization of the profits earned from mining to improve the economic growth of the city. The initiative was also meant to attract investors to trade in the mineral and its associated products in the region. Another important natural resource in Uganda is oil. Oil was discovered in the country in 2006. However, there have been delays in its exploitation due to various logistical issues. The exploitation of the Ugandan oil is now scheduled to start by 2020. About 6.5 billion barrels of oil have been reported. In preparation for the oil extraction, Uganda signed an agreement with Tanzania that will see the construction of crude oil pipelines from Hoima in Uganda through Bukoba to Tanga in Tanzania. A lot of job opportunities will be created but again the manufacturing industry will benefit in proving some of the equipment and tools for the construction of the oil pipelines.