According to the brief, the Business Climate Index (BCI) improved from 89 in Q2 FY2022/23 to 91 in Q3 FY2022/23. The improvement is mainly driven by Input costs, production cost, activity, turnover, capacity utilisation and profit. However, despite of the improvement, the conditions for doing business remained below potential during the review period (January to March 2023).
The brief noted that during in Q3 FY2022/23, Tax policy, macroeconomic factors, insufficient demand, electricity availability, and access to finance were the major constraint to business operations. These same challenges prevailed in the previous quarter ended in December 2022, indicating that business changes in Uganda are persistent.
Notably, many of the businesses lack sources of information about the African Continental Free Trade Area (AfCFTA), and most of them are unaware of the AFCFTA. As a result, many are most likely to attain very little gains from trading under AfCFTA.