The ‘Buy Uganda, Build Uganda’ policy, which was recently approved by cabinet, aims at encouraging Ugandans to buy locally-produced goods. However, critics say there is much more that needs to be done for entrepreneurs to benefit from a local market, writes Alon Mwesigwa.
Annet Mugerwa is one of the Ugandan women working hard to have their products on the shelves of top supermarkets in town. She supplies crafts, fresh dodo, and sweet potatoes. At a recent Uganda-Rwanda business forum in Kampala, Mugerwa had no good words for local stores. She told of how they delayed her payments and never placed her goods in visible shelves.
“When they delay my payments, I become inefficient. They say my products don’t move as fast as the imported ones, the reason they pay foreign suppliers first,” said Mugerwa, prompting President Museveni to ask Trade and Industry Minister Amelia Kyambadde what she had done about such challenges.
Kyambadde then said they had been supervising supermarkets and local products accepted in the big local stores had increased considerably. Ugandan products now make up about 40 per cent of goods in supermarkets. But one question remained unanswered: why don’t local products sell as well as the imported ones?
In an apparent attempt to address that question, the government recently launched the Buy Uganda, Build Uganda policy. It seeks to compel government ministries and departments to purchase local products instead of importing.
“Deliberate interventions will be made in areas such as public procurement preference schemes promoting the use and conformity to standards enhancing the capacity of SMEs in meeting supermarket supply-chain requirements and assisting [the] private sector in the development of the ‘Proudly Ugandan’ brand,” reads the policy.
Often, government departments buy in bulk, which can provide quick capital that can be ploughed back into the business to increase efficiency and timely production of the required goods. Particularly, the policy says things such as office furniture, beverages, processed foods, textile, clothing, footwear, leather, paper products, pharmaceuticals, building materials, and handicrafts should never be imported since they are available locally.
Godfrey Ssali, a policy analyst at the Uganda Manufacturers Association (UMA), believes the policy is a positive step towards encouraging Ugandan producers to bring their ‘A’ game to the table.
“This is certainly one of the best gifts that you could give to local producers here,” said Ssali. “I am certain that if we start small, we shall grow big. Overall, it [policy] is a very big bridge.”
While there is a policy to buy Uganda, it will still remain at someone’s discretion to buy a local product. This means that in supermarket shelves, Ugandan products will still be placed side-by-side with others imported from Kenya, South Africa, India or China.
“You must give someone a reason to choose your product, not the one from India. If I am spending my money, then I need to get value in the product or service I buy,” said Robert Mwebembezi.
Ssali says because there will always be competition from foreign products, Ugandan manufacturers must work harder on branding, packaging, quality, and standards to make their products attractive. The assistant chair for the Private Sector Foundation Uganda (PSFU), Dr Gudula Naiga Basaza, says Ugandan manufacturers have what it takes to make it, especially if propped up so that they can stay on their feet. She reasons that the cheapest market one can have is the one at home.
“At home, one does not incur flight costs, pay customs officials and others. If Ugandans can have a positive attitude towards local goods, we will surely see positive results from this policy,” said Basaza, also the chairperson of Uganda Women Entrepreneurs Association Ltd (UWEAL).
Drop in the ocean:
Some industry players believe a lot more must be done for the local entrepreneurs to gain from this policy. Derick Kirungi, the sales and marketing manager for Best Bushera Uganda, told The Observer that while the policy gives an opportunity to local producers, they should not be complacent.
“We live in a global market and you have to accept competition. This policy is not what entrepreneurs want now,” Kirungi said. “They need a favourable climate to actually produce better products. They need access to raw materials to make the products better.”
Most Ugandans supply unprocessed products and that is where the biggest challenge is, according to Basaza.
“If we can’t process quality g-nut paste or peanut paste, there is a problem there,” she said.
Another key challenge is the cost of locally-produced goods – often more expensive than imports. For most Ugandan entrepreneurs, the problem has not been that their products are not bought locally: the challenge is that they don’t have the capacity to sustainably supply the available local market.
For instance, Fresh Cuts, the processors of meat and poultry products, has often said that while it would want to buy all its supplies here, they were not available at the right time in the needed quantities.
“Every day we shout here that farmers should give us as many animals and birds [chicken] as they can, but we hardly get these supplies,” Fresh Cuts Managing Director Stephan Duyck told The Observer last year. “If a farmer can raise 50 quality birds, you are welcome to be our supplier.”
The factory demands about 2,000 birds a day in Uganda alone. This means we will need more supplies to meet the market demand in the region. But Ugandans would raise their supplies if they worked together, according to Basaza. She said the biggest setback for local entrepreneurs is that they are cocooned in a shell of selfishness.
One individual poultry farmer, she said as an example, may not have the capacity to supply the Sheraton hotel with chicken daily, but if they came together, they can make it.
“Ugandans want to work alone,” she said, “but I think if we worked together, we would be able to raise the required supplies.”
Source : The Observer