FY2024/25 Budget: What Lies Ahead for Entrepreneurs and Innovators 

FY2024/25 Budget: What Lies Ahead for Entrepreneurs and Innovators 

As the hours draw closer to the national budget reading, the anticipation among Ugandans intensifies. This year, the government’s proposed Ushs72.1 trillion national resource envelope has captured significant public interest, especially as it marks a substantial Ushs20 trillion increase from last year’s budget. The burning question is: What are the priority areas justifying this significant hike in allocation? 

For players in the private sector, particularly entrepreneurs and innovators, the national budget offers crucial insight into the government’s strategic priorities and interventions aimed at boosting business and fostering growth. It provides a roadmap to navigate the economic landscape and seize opportunities that can ease the nation out of challenging economic times. 

Speaking during the launch of the National Budget Month, Permanent Secretary to the Treasury, Ministry of Finance, Planning, and Economic Development Ramathan Ggoobi highlighted four priority areas that the government is focusing on to achieve comprehensive monetization of every aspect of the economy. These included –  Agro-Industrialization Development and Value Addition, Tourism Development, a Knowledge-Based Economy through Science, Innovation, and Technology, and Mineral-Based Industrial Development. 

Cliché as it may sound, agriculture remains the backbone of Uganda’s economy, highlighted by its significant contribution to the country’s GDP. The focus on agro-industrialization lies in the underlying theory of change for the country’s macro-economic development framework, which is based on the achievement of higher household incomes and improved well-being through resource-led sustainable industrialization. 

 Naturally this presents opportunities for entrepreneurs and innovators through the identification of areas within the agricultural sector where industrialization can bring about positive outcomes including food processing, value added agricultural products among others, technology adoption, sustainable practices, market access, value addition and diversification not forgetting policy support that incentivizes sustainable industrialization in agriculture.   

The expansion of Uganda’s manufacturing industry and the steps towards industrialization provide unmatched potential for accelerated growth by adding value to raw materials produced locally, rather than being exported unprocessed. By investing in processing facilities, improving supply chains, and promoting agricultural research, not to mention skills development, the government seeks to enhance the competitiveness of Ugandan products in global markets. The results remain to be seen as this coincides with NDP III that cites the promotion of local manufacturing as a key development strategy to be achieved this coming financial year 2024/25. On whether this will solution for Uganda’s glaring trade deficit, remains to be seen.  

Additionally, the focus on the knowledge-based economy through the generation and exploitation of knowledge plays a predominant part in the creation of wealth. In such an economy knowledge is the main driver of growth and development across all sectors including technology, education, healthcare and manufacturing which make up a robust framework that supports the sustainable growth and success of startups, making it a jackpot for innovators and entrepreneurs aiming to accelerate Uganda’s economic growth. 

The knowledge economy is defined as the intellectual aspect of the economy where knowledge is acquired, created, transferred, and used effectively to enhance economic development. This economy provides the foundational elements necessary for innovation and startup growth by offering a rich environment of information, expertise, and technological resources that fuel innovation and development according to the National Budget Framework Paper FY202425.

To put this into perspective, startups in a knowledge economy have access to cutting-edge research, advanced technologies, and a wealth of data, enabling them to create groundbreaking products and services that meet evolving market demands. This access lowers the barriers to entry, allowing entrepreneurs to launch and scale their ventures more efficiently. Additionally, the knowledge economy fosters a culture of collaboration and continuous learning, where startups can benefit from partnerships with academic institutions, research centers, and established companies. This interconnectedness provides startups with essential mentorship, funding, and strategic guidance, and facilitates the exchange of ideas and best practices. 

Therefore, by promoting innovation, agility, and resource sharing, the knowledge economy creates a dynamic and supportive ecosystem that drives sustainable startup growth and long-term success. 

Further still while Uganda boosts of a rich cultural heritage, diverse wildlife, and stunning landscapes that position it as a prime tourist destination, the potential of the tourism sector remains underutilized, leading to stagnant growth. With the government now focused on unlocking this sector’s potential, the opportunities for startups are immense through the introduction and adoption of innovative technological solutions that enhance the tourism experience. 

Technology solutions that offer personalized travel itineraries, augmented reality experiences that bring historical sites to life, and smart solutions for sustainable tourism practices can be key additions to sector growth. Therefore, the government’s emphasis on tourism provides a unique window for technology-driven ventures to revitalize and transform Uganda’s tourism landscape, driving growth and innovation in the industry. 

Finally, the focus is on mineral-based industrial development, particularly in the Oil and Gas sector, which presents numerous opportunities for entrepreneurs to tap into. Oil and Gas can generate significant revenues that can enhance productivity and competitiveness across other areas of the economy.  

With the government now focused on exploring various downstream economic activities, including establishing oil refineries, petrochemical plants, and distribution networks for petroleum products, and setting up retail outlets for natural gas distribution, entrepreneurs should seize this moment to innovate and invest in the Oil and Gas sector, leveraging its potential to not only create profitable ventures but also contribute to the overall economic development of the country. 

As we look forward to the budget reading today, the government’s strategic priorities reflect a comprehensive approach to economic transformation. By focusing on these four key economic drivers, Uganda aims to build a resilient economy that can withstand global economic uncertainties, create sustainable jobs, and invest in the overall quality of life for its citizens. It is crucial that entrepreneurs and innovators pay close attention to these developments, as they present numerous opportunities to align their business ventures with the national growth agenda and contribute to the country’s economic prosperity.