Economic development is the process through which the structure of the economy improves on account of investment driven and productivity centered economic growth.

Over the last 30 years, Uganda’s quest to transform from a subsistence to a sustainable economy has been anchored on significant policies. Notable among these are: Economic Recovery Program (1986-1992), Structural Adjustment Program (1991-1994), and Poverty Eradication Action Plan (1997-2007). Implementation of these programmes has played an instrumental role in boosting the country’s economic growth and reducing poverty. The revival of national development planning in FY 2009/10 saw a shift of the policy agenda towards long-term issues related to structural change, wealth creation and the productive capacity of the economy. The first and second NDP’s prioritised investments in infrastructure development; strengthening human resource development; harnessing industrialization and export oriented growth through value addition, agro-processing, mineral beneficiation among others and strengthening governance mechanisms and structures.

Government’s public investment programmes are accordingly focused on increasing labour productivity and mordernising the economy. Over the past two decades, the structure of the Uganda’s economy has significantly changed. The share of agriculture in GDP has declined while that of industry and services has increased. In terms of factor productivity, there has been significant structural change in the sectoral and occupational composition of the labour force. The percentage of households relying on subsistence agriculture has fallen from 54 percent in 1992/93 to 40 percent in 2017/18.

As far as the external sector is concerned, the dominance of primary products in the export basket has diminished. By 2015, coffee’s share of merchandise exports had shrunk to about 18% compared to 23% in 2001 and over 90 per cent in the early 1990s. Uganda has also become increasingly integrated into regional and continental economy. The share of Uganda’s exports to the EAC region has increased over the last decade, with the level of formal exports increasing by 49.4 percent, from $970.78 million in FY 2010/11 to $1,450.25 million in FY 2016/17.

Factoids

1. Uganda’s per capita GDP increased from US$ 807 in 2015/16 to US$ 905 in 2019/20
2. The share of trade in GDP increased from 27.1 percent in FY 2014/15 to 29.5 percent in 2019/20
3. Growth in productivity per worker in the services sector has slowed, averaging one percent per annum between 1999 and 2016 compared to 2.1 per cent for industry and 0.4 percent for agriculture over the same period
4. The size of the economy more than doubled from UShs 46.9 trillion in 2011 to UShs. 138.6 trillion in FY 2019/20