Sarah Kagingo, Vice Chairperson of the Private Sector Foundation Uganda (PSFU), has applauded Uganda’s continued economic stability amid global uncertainties while emphasising the urgent need to address outstanding domestic arrears to sustain growth.
Speaking at PSFU’s National Post-Budget Dialogue held at Protea Hotel Kampala under the theme “Unlocking Investment and Job Opportunities through Commercial Agriculture, Industrialisation, Digital Transformation, and Market Expansion,” Kagingo highlighted that Uganda’s private sector is poised for growth but requires greater access to affordable credit and expanded market opportunities to fully realise its potential.
The event brought together government officials, business leaders, development partners, and sector stakeholders to deliberate on strategies for accelerating inclusive economic development.
While delivering remarks, which were lauded by PSST Ramathan Ggoobi as a good grasp of strategic matters, Kagingo outlined private sector wins in the budget and key concerns.
She lauded the goverment for macroeconomic stability, containing inflation at 3.4% – the lowest in the region, and a 14% return on investment. “This is inspite of disruption of the global supply chains and unrest in the region,” observed Kagingo.
She also noted Uganda’s projected growth rate of at least 7% in the medium term of the 2025/2026 financial year.
“We commend the government for aligning the national budget with the NDP IV and for measures that directly support the private sector, such as the three-year income tax holiday on Startups, the recapitalisation of Uganda Development Bank by UGX 1 trillion, and the increase in domestic arrears clearance from UGX 200 billion to UGX 1.4 trillion,” Kagingo noted.
“We welcome the three‑year income tax holiday on Startups —this incentive will encourage more businesses to start, formalise and drive innovation.”
She urged the government to extinguish domestic arrears within two years, as delayed payments have crippled many businesses. “We acknowledge the stepping up of the budget allocation to domestic arrears from Shs 200 billion last financial year to Shs 1.4 trillion this year.”
On tourism, Kagingo welcomed the government’s launch of the Karamoja Tourism Project, the increase in direct tourism investments to UGX 430 billion, and UGX 2.2 trillion allocated to supportive infrastructure like tourism roads and ICT connectivity in tourism zones.
“Tourism has the potential to generate over USD 50 billion for the economy,” she noted.
Kagingo also highlighted key pain points, including persistent electricity fluctuations affecting manufacturers, high lending rates (averaging 17% compared to China’s 1.5%), and the urgent need for affordable credit through gender-responsive financial mechanisms.
Other critical recommendations included: establishing a dedicated UGX 400 billion fund to support mineral-based industrialisation, scaling up support for science, technology, and innovation with UGX 835 billion allocated in the 2025/26 budget, especially through initiatives like Kiira Motors, accelerating certification processes by UNBS to avoid long delays and integrating the regional market further through the elimination of non-tariff barriers and enhanced collaboration with the Ministry of Foreign Affairs and the East African Community Affairs.
Kagingo also cautioned against the dangers of misinformation and urged private sector leaders to verify information before forwarding it, especially within business-focused WhatsApp groups, stating that “misinformation harms partnerships and national credibility.”
On sustainability, she rallied companies and associations to embrace green financing and ESG (Environmental, Social, Governance) standards, noting that global investors increasingly prioritise sustainability in funding decisions.
On regional stability, Kagingo hailed the government for playing a crucial role in national and regional stability.
“Stability is a prerequisite to the thriving of the private sector. Mr. PSST, please extend our commendation to government for Uganda’s stability and the critical role our country plays as an anchor state for regional stability and beyond,” said Kagingo.
In her closing remarks, Kagingo paid tribute to PSFU’s past leaders and recognised the strategic leadership of the current board chair, Mr Humphrey Nzeyi. “He never ceases to ensure that we move as a team, no matter the challenges,” she said.
As PSFU marks 30 years this August, the private sector’s message was clear: Uganda’s economic prospects are promising, but realising them will require bold policy execution, targeted investment, and continued government-private sector synergy.
