Ugandas Investment Environment Martin Muhangi Deputy Director Investment

Uganda’s Investment Environment Martin Muhangi Deputy Director, Investment Promotion Division June 17, 2019

Outline § Mandate of Uganda Investment Authority § Uganda’s location for viable investment § Turkey-Uganda strong partnership § Investment opportunities § Attractive incentive regime § UIA support/services

Mandate of Uganda Investment Authority 1 Coordinate, promote and facilitate investments 2 Develop sustainable Domestic Investors and SMEs 3 Advise Government on Investment policy 4 Operationalize One Stop Service Centre 5 Develop and manage Industrial and Business Parks

Why Uganda? Uganda is a fairly tale • Scenery is different • Climate is different • People are different “It is a pearl of Africa” Sir Winston Churchill 1907

Why Uganda? Approximately 40 million people Tripartite FTA EAC, COMESA, SADC 57% of Africa. 632 Million EAC (6 Countries) 170 Million Source: COMESA RIA Turkey Source: EAC 2016 Statistics COMESA (19 Countries) 500 Million Source: UNCTAD 2016

Why Uganda? – An open Economy Uganda is among the most open countries in the region to foreign direct investment (FDI) All sectors liberalized for investment Part of a fast growing Common Market (EAC) 100% foreign owned investment permitted Free repatriation of profits Free inflow & outflow of capital Security of investment and person guaranteed

Uganda’s Competitive Cost Drivers § Labour availability and competitive labour cost § Operating costs competitive in the EAC (Uganda's electricity costs are competitive in the region (Source: f. Di Benchmark from the Financial Times Limited). § Property costs in Uganda are competitive with industrial shed monthly rents in the range of $4 - $6 per sq. m. (Source: Knight Frank, Local Property Agents) § An attractive and stable investment and working environment § A competitive incentives package § Major access into the markets Courtesy image: businessecon. org

Uganda: 2 nd forerunner in FDI attraction in EA Status of FDI Inflows in the EAC (2018) 7000 FDI Inflows (US$ Millions) 6000 5000 4000 3000 2000 1000 0 Uganda Kenya Tanzania Rwanda Burundi 2005 -7 (Pre-crisis annual average 605 393 640 40 2014 2015 2016 2017 Total 1059 821 1416 459 47 738 620 1561 380 7 626 393 1365 342 700 672 1180 366 3728 2899 6162 1587 54 Source: World Investment Report 2018 by UNCTAD

FDI Trends in Uganda- Reasons § Government support § Proximity to markets or customers § Availability of skilled workforce § Domestic Market Growth Potential

Turkey-Uganda strong partnership Foot print of Turkey in Uganda Success Stories • Turkish Airline • Kolin Insaat Turizm Sanayi Ve Ticaret A. S. • SSA Investments http: //www. invest. gov. tr http: //www. kolin. com. tr/english/ https: //www. ugandainvest. go. ug/ www. ebiz. go. ug

Opportunities üDon’t go it alone! Partnerships are key “Walk alone if you want to walk fast, walk with others if you want to go far” African Proverb

Agriculture / Agro-processing Commercial Farming • Uganda is the 3 rd largest producer of bananas in the world • Uganda is the 8 th top coffee producer in the world and 2 nd in Africa • Uganda is endowed with warm climate, ample fertile land regular rainfall • Fruits- Oranges, Lemon, Avocado, Pineapple, Ginger, Spices, • Matoke • Coffee • Cotton • Cereals-Maize, Rice, Beans • Livestock • Fish • • • Agro- Processing Manufacture of inputs Machinery for agriculture Cold chain distribution Greenhouses, Irrigation Packing Materials

Tourism • Variety of game stock • Unspoilt scenic beauty • Impenetrable mountain forests • Snow peaked mountains Opportunities • High to Medium end accommodation • Specialised Eco facilities in ecologically sensitive areas. • Wide range of bird species • Medical tourism • Water sporting- White water • International rafting • 50% of world population of mountain Gorillas rated tourism hospitality and training centres. • Aviation transport

Tourism Mt. Rwenzori snow –Climbers Only found in Bwindi impenetrable National Park and Mgahinga Gorillas National Park

Tourism-Variety of Bird Species Distinctive Birds Wide range of birds

Minerals Resources/ Potential • Gold • Iron ore- Over 200 million metric tonnes • Uranium • Tin Non- metallic minerals • Graphite • Clays • Phosphates Over 50 mineral types exist in Uganda Opportunities • Mining and processing plants • Establishment of mineral laboratories-Modern analytical equipment's. • Drilling rigs with drillers • Logistics Great need for Iron and Steel for infrastructure projects in Uganda/Turkey

Oil and Gas The Rich Albertine Ugandan Resources Recoverable > 1. 7 bn barrels > 6. 5 bn boe Uganda will be among the Top 50 producers in the world and Top 10 in Africa Source: Tullow Uganda

Motivation for Nascent Oil Sector Major oil discoveries have raised Uganda’s significance on the investment map 14 FDI projects in 2017, up from 9 in 2016 Source: Ernest and Young-Attractiveness in Africa October 2018 12/7/2020

Oil and Gas “The Graben” Turkey investors/Partners are better placed to support Uganda’s oil and gas industry Value Chain Opportunities • Licensing of petroleum exploration • Joint Ventures with companies in exploration • Waste Management and removal • Infrastructure development • Education and Training(fabrication, electrical) • Rig hire • Oil Storage tanks • Logistics

Information Communication Technology ICT • Certified training centers • Development of quality ICT infrastructure ICT • Business Process Outsourcing ICT • Soft ware development and services • Hardware manufacturing and Assembly • Uganda is ranked 15 th in Africa in internet usage/penetration 42. 9% of the population use internet. Source: Internet world statistics 2019 76. 3 percent of all households in Turkey have internet access. Source: Invest in Turkey –Web portal

Infrastructure opportunities Water • Bulk Carrier • Container Ships • General Cargo • Oil Tankers • Fishing industry Roads • Express High Ways • Tourism Roads • Lake Victoria provides a huge potential for trade and investment Opportunities

Industrial parks • Industrial Parks - 22 countrywide • Regional. Science, technology and Innovation Parks - 4 Regions • Free Zones

Benefits of investing in Uganda Incentive Regime Sector Specific Incentives Import duty exemption on on all plant and Machinery available in specific sectors • Agriculture 10 year income tax holiday on all export income Losses carried forward indefinitely till full exhaustion 100% training expenditure for Ugandan employees allowed • Tourism Availability of land in industrial parks/Free zonesland in government industrial parks VAT deferment on on imported plant and Machinery • Infrastructure Incentive Regime • Oil and Gas • Mining • Energy Sector

Benefits of investing in Uganda New incentives. Incentive Regime Effective July 19 Foreigners investing USD 10 million in the Import duty exemption on all plant industrial park, or any other place in Uganda are entitled to 10 year tax holiday VAT exempted on feasibility studies Sector Specific Incentives • Agriculture • Tourism • Oil and Gas • Mining • Infrastructure • Energy Sector

Ease in doing business- UIA Reforms • Incorporationand registration- 4 hrs • Tax registration less than 24 hrs. • Permits/licenses Issued at One Stop Centre • Online services available 24/7 Improved Business Environment Online One Stop Centre www. ebiz. go. ug 24/7

So what will the government of the future look like? • Open to service 24/7 all year round • Competes with and surpasses the private sector • Is connected • Is Innovative constantly able to generate new ideas Mohammed bin Rashid Al Maktoum His book Flashes of thought

One Stop Centre Services In order to ease business and improve efficiency, UIA is a One Stop Centre (OSC) for business registration, licensing and accessing investor relevant services. Business Registration (URSB) Trade registration and building approval in Kampala (KCCA) Lands verification (Lands Registry) Standards Certification (UNBS) Banking Facilities (DTB) Uganda Investment Authority (Investment promotion, facilitation and monitoring) Environmental Advice & Compliance (NEMA) Tax Advisory & registration (URA) Utility Providers (NWSC and Umeme) Free Zones (UFZA) Immigration (DCIC) Conservation Tourism Opportunities (Space for Giants)

Services at UIA • • • Providing Information on investment opportunities Issuing Investment Licenses Assisting in Securing Secondary Approvals Finding Joint Venture Partners The Investors’ One Stop Centre” (Now offering various services) Handholding Investors through all procedures Providing access to land for investment Development and Enhancement of Small and Medium Enterprises Policy Advocacy -Recommendations to Government on policies affecting investment.

Conclusion “Risk comes from not knowing what you're doing. ” Warren Buffet “Our main purpose is to bring Turkish and Ugandan Business people together more often and to contribute in creating a solid partnership through new business opportunities” Turkish Uganda Business council Ersin Eren- Chairman Turkish Uganda Business Council

Invest now…. . Invest in Uganda Thank You Email: info@ugandainvest. go. ug Website: www. ugandainvest. go. ug Tel: +256 313 301000 / 301100 www. ebiz. go. ug