UDB’s Shs 2.45trn helped anchor Uganda’s growth in 2021-report

KAMPALA– Uganda Development Bank [ UDB ], the country’s national development finance institution days ago released its 2021 Direct Impact [DI] Report highlighting the fundamental role that the Bank continues to play toward Uganda’s sustainable socio-economic transformation and growth.

The report highlights UDB’s work and coverage through job creation, output value, forex, and tax generated by enterprises supported by the Bank. “In the intervening period, the Bank’s investment created and maintained a total of 41,338 jobs, and a total output value of Shs 2.445 trillion was realized. This output value contributed Shs 84bln on in form of tax revenue to the government, and forex earnings of Shs 405 billion,” the report reads in part.

Job creation

The share of jobs created and maintained per sector was highest in Agro-processing at 41 percent, followed by Primary Agriculture at 30 percent. The manufacturing, infrastructure, and tourism sectors contributed 17 percent, 6 percent, and 3 percent respectively while other sectors that the Bank supports, including health and education accounted for 4 percent.

Output value

Of the total output value reported in 2021, the Agro-processing sector contributed 42 percent, followed by the manufacturing sector at 33 percent, and primary agriculture at 17 percent. Other sectors contributed; infrastructure – 3 percent, health – 3 percent, and tourism – 2 percent.

Profits

The Bank through its investments, continues to facilitate the growth of a vibrant and sustainable private sector. The enterprises funded by UDB generated profitability amounting to Shs 314bln. Through 2021, the highest profits being posted by enterprises in the Manufacturing sector which contributed 39 percent, followed by Agro-processing at 32 percent, and 21 percent from primary agriculture sectors respectively. The tourism and health sectors contributed 4 percent and 2 percent respectively.

Tax

Of the tax contributions reported, the Manufacturing sector contributed the highest share of 45 percent. This was followed by Agro-processing at 25 percent, primary agriculture at 23 percent, and 3 percent for both Infrastructure and Tourism respectively.  The health sector contributed 1 percent of the total share of tax revenue reported whereas the Education sector had no contribution in light of the effect of the Covid-19 pandemic lockdown measures.

Foreign exchange

The share of foreign exchange earnings among the enterprises was highest in the agro-processing sector at 50 percent, followed by the manufacturing sector at 33 percent. The health contributed 14 percent of the forex earnings contributions.

Gender

In line with the Bank’s effort to democratise economic participation, the DI report notes positively that over 30 percent of companies funded by UDB are owned by women. The dedicated funding program for Women and Youth known as Special Programs launched in 2021 shall however be expanded to reinforce these targets as women and youth together constitute the most active segments in the economy as well as the most numerous.

“These results reflect the Bank’s sustained contribution to the economy, augmenting the production of essential commodities amidst the shock of the COVID-19 pandemic which affected all the sectors, increased the cost of living, and disrupted global trade and markets. This Direct Impact Report 2021 demonstrates that UDB’s presence in the economy has had an overall positive impact,” Dr. Francis Mwesigye, the Director Economic Research and Knowledge Management at UDB said during the launch of the report.

“I would like to thank our customers, with whom we partner to deliver these results. I do reiterate our commitment as UDB, to deliver our mandate by deliberately focusing our efforts on interventions that create sustainable impact, thereby improving the quality of life of Ugandans.” The Direct Impact report tracks the Bank’s socio-economic footprint against its Strategic Plan and the country’s national development priorities. In addition, the Bank looks at its High Impact Goals which are aligned with engendering wholistic sustainability, inclusion, community development, and environmental protection.”

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