Traders, employers, labour unions and politicians yesterday cheered President Museveni’s order on foreigners in retail trade and observed that the “importation of importers” had distorted the economy, worsened unemployment and poverty levels.
According to Mr Everest Kayondo, the chairperson of Kampala City Traders Association (Kacita), his members, especially from major towns across the country, have previously petitioned authorities over the influx of foreigners in retail business but were not helped.
He also explained that “the importation of importers” is partly responsible for turning Uganda into what President Museveni previously called a “supermarket of foreign products”.
Chance for Ugandans
“We have no problem with the foreigners coming to do business in the country, but they must be manufacturers, not retailers. We want the whole value chain to be done in Uganda so that our people can get jobs. Let them consume our water, food and electricity. This will create wealth for our country,” Mr Kayondo said.
While Kacita and other private sector leaders called the presidential directive ‘a catalyst for economic growth and job creation’, Kampala Lord Mayor Erias Lukwago derided the
decision as “a knee-jerk reaction to a complicated problem.”
“Do we have a policy and legal framework to address that matter?” he asked, adding that “It could be a public relations stunt intended to divert public attention on the bailout scam.”
“If he is concerned about the exploitation of the local business community, how come he is not pushing for the enforcement of the Rent Restriction Act, whose purpose was to check the arbitrary increase of commercial rent by property owners?”
The President’s directive
Addressing the social economic transformation obstacles during the on-going Cabinet retreat in Kyankwanzi on Tuesday, Mr Museveni applauded Ugandans for welcoming more than 600,000 African refugees and singled out Chinese and Indians in retailing business, whom he accused of unfairly competing with local traders and other African immigrants.
The President said foreigners should not operate at “terminal level” and instructed the relevant government ministry to ensure that they are re-directed to manufacturing and construction.
“Retailing should be preserved for the Ugandans or, possibly, the other African immigrants as well,” he said.
Mr Sudhir Ruparelia, the founder of Ruparelia Group, one of Uganda’s largest conglomerates and a member of Federation of Uganda Employers, also backed the presidential directive. He said the ministry of Trade should work with immigration and Uganda Investment Authority “to tighten the rules of the game.”
Information and ICT minister Frank Tumwebaze said the new presidential directive seeks to protect local jobs, attract foreign direct investments and fight dumping of inferior goods.
He explained that ministry of Trade and industry, in conjunction with immigration directorate and Uganda Investment Authority, “will come up with a policy instrument to provide for regulatory framework.”
“This will have to be harmonised with existing immigration policies on work eligibility for foreigners,” Mr Tumwebaze said.
Asked how Chinese and Indians come to be retailers, the Internal Affairs ministry spokesperson, Mr Jacob Siminyu, referred this newspaper to Section 10 of Investment Code. Without explaining how the code has affected the monitoring of the foreigners doing business in the country, he also pointed out that the code requires any foreign investor to have $100,000 (about Shs338m) to invest in any type of business, subject to Section 10(2), which states that an investor may engage in any type of business enterprise.
Section 10 (5) reads: “A foreign investor who is intending to engage in trade shall — (1) incorporate a company with the Registrar General as is required by law; deposit a sum of $100,000 or its equivalent in Uganda shillings at the Bank of Uganda, which shall be specifically used for importation or direct purchase of goods for the business.”
Mr Wilson Usher Owere, the chairman of National Organisation of Trade Unions (NOTU), said Investment Code needs to be amended to ring-fence retail businesses for Ugandans. He explained that “the influx of (foreign) retailers, doing business in Kikuubo (downtown Kampala) and in major towns across the country, had pushed many Ugandans out of business.
“It (directive) will help us to protect the jobs in informal and formal sectors, especially construction where unskilled labour force are brought from China and India,” Mr Owere said.
Credit: All Africa