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Uganda

Situation and cooperation

View of Kampala, Uganda

President Yoweri Museweni, who has been in office continuously since 1986, was reconfirmed as president for the sixth time in early 2016. The opposition and international election observers complained that there had been irregularities during the elections, as well as massive attempts by the government to intimidate and manipulate voters. For example, the most important leader of the opposition, Kizza Besigye, was arrested several times in the run up to the elections, and access to social media was blocked on election day.

In the "model developing country" of Uganda, the government's efforts at reform have tailed off in recent years. Thus, the country has shown considerable problems in terms of governance, in particular as regards corruption control. In the Corruption Perception Index compiled by the non-governmental organisation Transparency International, Uganda ranks 139th out of the 168 countries evaluated. The donor community also considers the human rights situation there as problematic.

On the positive side, the Ugandan Human Rights Commission – a body supported by the BMZ – is energetically performing its role as a supervisory and appeals board for human rights violations. Moreover, parliament, the supreme courts and the court of auditors (also supported by the BMZ) take their roles seriously and take care to act independently, in keeping with the principle of the separation of powers. The media and civil society take an active part in political discourse.

Successes in fighting poverty

Growing geraniums on a flower farm in Kampala, Uganda

Uganda's economic and social situation has improved markedly since the early 1990s. The government has been particularly successful in reducing poverty and cutting the rate of HIV infection. The number of people living below the national poverty line has been reduced significantly, from 56 per cent in 1992 to approximately 20 per cent today.

Despite this achievement, many people still live in great poverty, in particular women, people living in rural communities and those living in the conflict-ridden north of the country. There, the poverty rate is significantly higher than the average in the rest of the country. That is why Germany intends to focus its development cooperation activities primarily on Uganda's northern regions for the next few years. In the country as a whole, more than a fifth of the population has no adequate access to clean drinking water, and more than 90 per cent live without electricity. Average life expectancy is just 58 years. On the United Nations Human Development Index (HDI 2015), Uganda ranks 163rd out of 188 countries.

Many development achievements have been cancelled out by the effects of the sizeable population growth (3.26 per cent in 2014). Almost half of Uganda's population is under 15 years of age – a vast challenge for the country. This means that each year hundreds of thousands of young Ugandans pour onto the labour market. Further constraints to development are the weak financial sector, widespread corruption and the lack of infrastructure. The country's natural resources are under threat because of over-intensive use. Deforestation in particular has reached alarming levels.


HIV and AIDS

The HIV infection rate, which, at the beginning of the 1990s, was over 18 per cent of the sexually active population, has been significantly reduced thanks to an extensive prevention programme implemented by the government. According to figures published by UNAIDS, the Joint United Nations Programme on HIV/AIDS, some 1.5 million people in Uganda are currently infected. That is slightly more than seven per cent of the 15 to 49 year-olds. Quite recently, however, the number of new infections has risen again. It is estimated that in 2014 some 33,000 people died of Aids in Uganda. And of the country's children and young people, around 650,000 are Aids orphans.


The economy

Building site in Kampala, Uganda

Economic growth in Uganda is stable, averaging about three to five per cent. However, there is a marked gap in prosperity between the North and the more prosperous South.

More than seventy per cent of Ugandans work in agriculture, with the majority of them producing enough to meet only their own needs. The share that the agricultural sector contributes to GDP comes to only 27 per cent however. Nevertheless, the agricultural sector is the most important source of foreign revenue for the country. The main export has historically been, and still is, coffee; the second most important is fish from Lake Victoria. Tea, cotton, tobacco, fruit and vegetables are also exported, but only in small amounts. The country is hampered by its landlocked position: in order to trade with countries beyond its region, Uganda needs to ship its goods as transit cargo through Kenya or Tanzania in order to use their ports.


Development potential

Street scene in Uganda

Pan-African and East African integration are cornerstones of Uganda's foreign policy. Relations with neighbouring Rwanda, which for a long time were plagued by armed conflict and mutual distrust, have improved significantly. Relations with South Sudan, established only in 2011, are close. In fact, South Sudan is an important export market for goods from Uganda. Uganda is considered to be a driving force behind the development of the East African Community (EAC) into a monetary and, eventually, political union.

Uganda sees the common market of the EAC, established in 2010, as a means of increasing sales of its goods within the region. However, this will require further diversification of the country's economy. Exports could be boosted for example by improving the marketing of products such as honey, vanilla and cut flowers. In addition to the construction industry, which benefits from infrastructure projects, the services sector (telecommunications, banking, tourism) is showing particularly promising developments.


Priority areas of German development cooperation

At the government negotiations in May 2013, Germany pledged 119.5 million euros to Uganda for the period from 2013 to 2015, of which 86.5 million euros were for financial cooperation and 33 million euros for technical cooperation. The following were agreed as priority areas of cooperation:

  • Water supply and sanitation
  • Renewable energies and energy efficiency
  • Sustainable economic development and agricultural finance

In order to systematically integrate human rights protection and to encourage greater tolerance within Ugandan society, German development cooperation is assisting government agencies to comply with human rights standards, and is strengthening the dialogue within civil society. As regards good financial governance, Germany is providing advice to Uganda's court of auditors specifically to help it promote accountability and fight corruption.


Urban water supply and sanitation

Women in Uganda transporting water canisters on their heads

Improving urban water supply and sanitation has for many years been a priority area of Germany's development activities in Uganda. This support has, over time, been paying dividends. For example, in the last two decades, the proportion of city-dwellers with access to safe drinking water has increased significantly. Further investments are needed, however, because so far only 29 per cent of people in urban areas are also connected to a properly functioning sewage system.

This unsatisfactory state of affairs is principally attributable to a dilapidated infrastructure, the low solvency of poorer sections of the population, rapid demographic growth especially in peri-urban areas, shortcomings in utility management and an inefficient distribution of political responsibilities.

Germany is advising the Ugandan government and its local authorities on the reform of the country's municipal water supply and sanitation sector. The aim is to support the national water utility and local suppliers in their efforts to upgrade their services, manage their companies more efficiently, and connect more households to the water supply and sanitation systems. The regional focus of these efforts is on the towns and cities of Northern and Eastern Uganda. Support is also being provided for training and upgrading of skilled workers for the water and wastewater sector.


Renewable energies and energy efficiency

Worker at the Bujagali hydro power plant in Uganda

Uganda has made considerable progress – thanks also to the activities carried out under Germany's development cooperation programme – with regard to its power generation capabilities and the expansion and operational unbundling of the organisations involved. Throughout the country, only eighteen per cent of Uganda's population have access to electricity. In rural areas, this figure is even lower – only eight per cent. In order to establish country-wide electricity supply, the Ugandan government is looking to exploit environmentally responsible sources of energy. Furthermore, it wants to ensure that the electricity sector will operate on a commercially viable basis. That means that, in future, government subsidies will only be available for development of the infrastructure.

Germany is helping Uganda to develop renewable energies on a sustainable basis, supporting actions designed to raise energy efficiency and helping with the electrification of rural areas. Germany is supporting both the construction of large-scale hydropower stations and the setting up of smaller, peripheral power stations.

As part of these efforts, Germany helped to finance the hydropower plant at the Bujagali Falls on the Nile. Since the middle of 2012, this plant has been supplying electricity to some three million people. The construction of other hydropower plants is also being funded, using new commitments made in 2013. Local electricity grids are also being extended, in order to improve the electrification of rural areas.


Fostering sustainable economic development and agricultural finance

Client banking card for microcredits at the FINCA bank in Kampala, Uganda

Uganda's financial sector has grown considerably in the last few years. Here again, Germany has contributed to this development through its close cooperation with Uganda's central bank. Despite this positive development, large sections of the rural population still have no access to financial services.

That is why Germany is mainly focusing its development cooperation involvement on improving the availability of finance in rural areas, with the aim of boosting investment in agricultural production. Providers of financial services are being helped through financial cooperation programmes to develop marketable financial products and business plans for agricultural financing, and to provide refinancing as a way to introduce these to a wide market.

At the same time, Uganda's central bank will provide advice on how to create safeguards for these operations and set up a supervisory body for a system of rural finance.


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