Failure of Ugandans to exploit the available resources is responsible for the stagnant economy in the country, financial stakeholders have said.
They say lack of capacity and financial limitations in Uganda have made it hard for the common person to exploit the resources at their disposal.
Speaking at the Stanbic Bank Budget dinner held Thursday evening at the Kampala Sheraton Hotel, Patrick Mweheire, the Stanbic Bank Uganda CEO said Uganda’s agriculture sector is under performing because the peasants who are the majority of the farmers are unable to fully exploit the available resources hence leaving a lot of land redundant.
Mweheire noted that 50% of the fertile land in the whole of east Africa is in Uganda and yet Uganda continues to be the least productive country in agriculture with a lot of people going hungry.
“We have a competitive advantage because we have half of the fertile land in the region that can grow any food and cash crop yet countries like Kenya and Rwanda continue to perform better than us in Agriculture. This is mainly because the farmers are incapable of using the available land to increase production,” he said.
He added; “70% of the farmers are subsistence farmers who cultivate on their small acres of land. These people do not have the capacity to rent land or even cultivate to large scale farmers in case they have the land.”
“That’s why we are asking government to concentrate on the large scale farmers so that they can be able to utilize the available land and increase production. The other small farmers can benefit directly from the large scale farmers,” he added.
Adam Mugume, Executive Director Research, Bank of Uganda said that the strategic growth of a 6% GDP that the country is working for will not be achieved if government does not refocus on the way they are handling agriculture production.
“We are under producing compared to our projected capacity. We are an agricultural country but we are still exporting juice from countries that do not even have land. Even when there is market for our produces, we are unable to supply constantly because there is underproduction,” he said.
“Government needs to refocus, instead of supplying seeds to farmers who will eat them or plant them on the dry land. It’s better to focus on the commercial farmers by modernizing the agriculture sector and making financial access easy for them so that they are able to produce more.”
Mugume also noted that although Uganda is strategically located and peaceful, its foreign direct investment FDI is still down compared to Kenya and Rwanda because Uganda is economically attractive.
Uganda’s GDP ratio is currently at 3.4% a drop from the 5% that was projected last year. This decline is attributed to poor agriculture production that resulted from bad climate changes in 2016.