Less than 10% of Uganda’s cotton is consumed locally

Under or less than 10 per cent of cotton produced in Uganda is processed and consumed locally, according to a study conducted by Dr Isaac MB Shinyekwa, a senior research fellow at the Economic Policy Research Centre.

The study contained in a United Nations Conference on Trade and Development report, indicates that because of this, Uganda is stuck at the bottom of the cotton value chain thus experiencing an unfavourable trade balance with the country exporting primarily raw materials to import finished goods.

The study, which indicates that although this is not unique to cotton, notes it is more pronounced in the “textiles industry, where Uganda exports cotton lint and imports manufactured cloths, both new and second-hand”.
Uganda currently spends at least $210m annually on textile imports, mainly from Asia and the Middle East.

However, the import bill is mostly comprised of second hand clothes, which have since 2001 increased fivefold from $27.4m (Shs102b) to more than $137m (Shs511b), according to a report by Economic Research Policy Centre.
However, cotton, one of the main ingredients in textiles manufacturing, remains a key foreign exchange earner for Uganda with more than 90 per cent of the commodity exported.

Cotton ranks among Uganda’s top five export commodities.
Locally, according to experts in the cotton value chain, the less than 10 per cent of the commodity that is not exported is processed into lint and used in the manufacture of garments, a key target under the Buy Uganda Build Uganda policy, which seeks to enhance locally made products.

Uganda has been seeking to reduce the amount of imports that enter the country, under the import substitution policy that has received more currency during Covid-19-related disruptions.
The country, which has been facing a number of challenges in the export sector, wants to focus on the domestic and regional markets to accelerate the Buy Uganda Build Uganda policy.

In textile it is seeking to bring all uniformed forces, medical garments and related products to create demand that will boost local manufacturing.
Ms Victoria Sekitoleko, a former minister of agriculture and the vice chairperson of Private Sector Foundation Uganda, said yesterday that whereas there has been much talk about Buy Uganda Build Uganda, its implementation has been slow, noting: “Let us quit talking about Buy Uganda Build Uganda and start doing it (implementing)”.

Uganda’s cotton income, according to data from Bank of Uganda, has in the last 12 months experienced a drastic drop, declining by at least 76 per cent during the period.
According to the Bank of Uganda May monthly performance report, cumulative cotton receipts for the period between June 2020 and May 2021, stood at $27.62m (Shs98b).

This was a decline from $48.68m (Shs172b) earned during the same period in the same period in the previous year.
During the period, cotton volumes also declined to 103,525.81 bales up from 191, 727.18 bales in the same period in the previous year.
This means that volumes suffered an 85 per cent decline compared to the same period the previous year.

Cotton, which until 2001, was Uganda’s third biggest export commodity, has also suffered a number of challenges raging from climate change and competition from other non-traditional cash crops.

Its production is dominated by small-holder farmers, whose productivity is often curtailed by lack of necessary resources, among which include quality seeds and depending on crude production methods, among others.

Challenges
Cotton, which until 2001, was Uganda’s third biggest export commodity, has suffered under a number of challenges raging from climate change and competition from other non-traditional cash crops.

Its production is dominated by small-holder farmers, whose productivity is often curtailed by lack of necessary resources, among which include quality seeds and depending on crude production methods, among others.

About westniletoday

Check Also

GULU COLLEGE OF HEALTH SCIENCE SET TO REOPEN AT THE END OF THIS MONTH

BY WALTER KUMIRA GULU: MONDAY, SEPTEMBER, 27, 2021 The Ministry of Education and Sports has …

Leave a Reply

Your email address will not be published. Required fields are marked *