The State Minister of Finance, David Bahati has assured Ugandans that government is still committed to achieving the middle income status by the year 2020 despite a number of challenges that the country is faced with.
Addressing government leaders during The Budget Conference on Thursday at Serena Hotel, the Minister noted that through a number of specific strategies for intervention in the 2018/19 financial year, the status shall be achieved.
These strategies include; increasing production and productivity in agriculture, enhancing industrialisation to support job creation and export, infrastructure development in transport, energy and ICT.
“Stimulating private sector growth, harnessing tourism potential, improving service delivery and managing emerging issues such as inequality, population growth, urbanization and climate change as well as improving governance.”
The Minister, however, highlighted the challenges to attaining Middle income status which must be addressed urgently. These include; inadequacy of policies and strategies to guide implementation of government plans.
“Even where policies exist, poor coordination and institutional weakness, specifically for multi-sectoral projects are big problems that result into uncoordinated plans, duplication, wastage and weak supervision of programs.”
Bahati noted that there are delays in project execution attributed to weak Public Investment Management for instance lack of project readiness, procurement administrative reviews, delays in compensation and delayed handling of land cases related to project compensation.
“Due to that, government fails to meet project deadlines and ultimately delayed realization of intended benefits yet most projects were envisaged to be the drivers for competitiveness of the economy.”
The Minister observed that the other cause is decline in Agricultural Production and Productivity majorly due to weather extremities, poor input quality and distribution. This is compounded by limited value addition as well as poor post-harvest handling.
He added that there are, currently, constraints to Private Sector Growth.
“NDPII targets private sector growth to reach 15.4% by 2020. However, this is still low at 7.5% caused by limiting challenges including high costs of electricity, capital/development finance and transportation which have rendered local manufacturing uncompetitive and difficult for business to breakeven.”