Country Private Sector Diagnostic

Creating Markets in Uganda: Country Private Sector Diagnostic

February 16, 2022

Growth through the Private Sector and Trade

Over the last two decades, Uganda has had a track record of implementing pro-business policies that have led to significant inward investment, high levels of regional trade, and a vibrant informal economy. However, the country’s growth rates have recently slowed, and there are signs of the government’s pro-business agenda stalling.

At least 600,000 Ugandans enter the labor market every year, making for a work force which is increasingly younger and urban-based. To address the country’s simultaneous productivity and job challenges requires a focus on growth in sectors that can leverage demand from abroad, are labor-intensive, and lower-skilled.

The Uganda Country Private Sector Diagnostic (CPSD) report examines three sectors of particular interest: agribusiness, which is important for productivity, employment, and export growth; energy, as an enabler of overall productivity; and housing, because of its role in fueling growth in the labor-intensive construction sector and alleviating the demographic pressures that rapid urbanization puts on Uganda’s cities. Within the agribusiness sector, the CPSD considers three promising value chains: fisheries, dairy, and maize. Beyond discussing challenges and opportunities specific to these three promising sectors, the CPSD also analyzes some of the cross-cutting constraints on the Ugandan economy and shares recommendations for reforms that can help open markets and attract investment.