Financial institutions in Uganda have pledged to provide shs. one trillion export credit facility to support local manufacturers boost their access to the regional markets. This was revealed at the 5th Annual Bankers Conference held in Kampala on July 25 under the theme, Bridging Financing Gaps in the Manufacturing, Tourism, and Agribusiness Sectors for Economic Recovery & Growth Post-2021.
The institutions under their umbrella body, Uganda Bankers’ Association (UBA) in partnership with PSFU, unveiled a special Regional Export Facility (REF) of an initial amount as a financial package to support exporters from Uganda, to regenerate and grow export volumes to the regional markets including South Sudan, DRC, Rwanda, Burundi, Kenya, Tanzania and Others.
Sarah Arapta, the chairperson of Uganda Bankers Association said, “Uganda not only has comparative advantage in agriculture and natural resources but is equally endowed with critical factors of production such as labour, electricity. The objective here is to plug the existing gaps, facilitate production, provide funding support to the catalytic and powerful entrepreneurial ecosystem through fostering amongst others, technology innovation, enhance value addition, drive export growth and fully harness the trickle-down benefits,” she said.
Currently, the manufacturing sector is recovering from the production shocks caused by supply chain disruptions, limited access to materials, loan repayment with no production, and above all reduction in markets for the manufactured products. This has been complicated with the Bank of Uganda’s recent hike in the Central Bank Rate as a measure to reduce the demand for the shilling to slow down inflation that crossed the 5% limit a few months ago.
In his remarks, the Chief Executive Officer, Private Sector Foundation Uganda (PSFU), Mr. Stephen Asiimwe said, “This is very good news for the private sector; this facility is a timely intervention which will support, finance and promote regional trade for our business community and private sector. PSFU has broadened its scope in service delivery to intentionally promote and access markets for Ugandan goods and services. Therefore, with such a facility in place, Ugandan traders will be able to do more business across the region and beyond since the financing gap will now be closed.”