Finance minister Matia Kasaija has observed that unemployment levels, income inequality and malnutrition and unhealthy lifestyles are the major development challenge facing Uganda’s economy.
While presenting the FY 2019/20 Budget, Kasaija said that despite the positive economic trends, the four bottlenecks continue to stifle efforts for the economy to be propelled further into greater heights.
On the unemployment levels, Kasaija said that there are now approximately 600,000 entrants into the job market every year, as a result of the universalization of health and education.
This has created the need for new jobs to meet this demand. Currently, 4 out of 10 young Ugandans are out of work. Furthermore, the quality of jobs is of concern,” Kasaija said.
The 2016 labour force survey indicates that 50% of Ugandans work in the Services sector, 35.6% in
Agriculture, and 14.4% in Industry. The informality of the Agriculture and Services sectors implies that about 80% of our labor force is in the informal sector, and therefore not optimally employed.
“With most Ugandans engaged in the rural economy, it is of paramount importance to increase labour productivity in agriculture and aggressively promote agro-processing which in the end will be the basis for Uganda’s industrialization and further job creation,” he said.
Kasaija also allured fears of how income inequality has widened between rural and urban areas, as wealth has not been created faster in rural communities in comparison to urban areas.
He added that malnutrition adversely affects the quality of life of children and mothers, despite the variety and quantity of foods that Uganda can produce.
“53% of children under five years are malnourished and hence anemic, and 29% of them are stunted or wasted. Many women of reproductive age are also malnourished, with 32% of them being anemic,” he said.
“In addition, inappropriate feeding especially among the more affluent, is also a major cause of a surge in chronic non-communicable diseases including coronary heart disease, cancer, diabetes, high blood pressure, and obesity. These maladies are largely attributable to unhealthy life styles.”
Consequently, Uganda has been spending on average US$ 500million on treatment of preventable diseases. “Improving the nutrition status of Ugandans accordingly requires coordinated actions, mass sensitization and education, and life style awareness,” he said.
Despite the mentioned bottlenecks, Kasaija said that Uganda’s economy has recovered and picked momentum, growing at over 6% per annum over the last two years.
“With the progress in economic growth, average incomes of Ugandans have increased to US$ 825 per person in Financial Year 2018/19, compared to US$ 800 in 2017/18, notwithstanding increase in the population size to 39 million Ugandans,” he noted.
Apparently, the quality of Uganda’s labour force has also dramatically improved, with the proportion of labour force with tertiary education increasing from 7.5% in 2013 to 13.6% in 2017.