UMA Namibia
HABARI DAILY I Kampala, Uganda I Government has seen the need to keep out foreign textiles and boost local production, said President Museveni recently.
During a meeting with manufacturers under their umbrella – Uganda Manufacturers Association (UMA), the president highlighted recent measures such as imposing taxes on textile imports to encourage local manufacturing.
“I need your opinion on the little war we have been having with importers. These government people woke up and put a tax on textiles, a percentage on the weight (kilograms); that is because we want to shut out foreign textiles,” he said.
While officially launching the Mbale Industrial Park last year, President Museveni urged Ugandans to stop buying second-hand clothes, calling them clothes of the dead.
He announced his intention to ban imports of used clothing, as a way of bolstering the local textiles industry.
The decision was in line with the East African regional bloc’s directive to kick out second hand clothing, which has proven challenging for governments to enforce.
The Government, through URA henceforth increased tax rates in form of import duty on textile goods from 25% to 35% and also charged 5 US Dollars per kilo which was high.
Deo Kayemba, UMA’s Board Chairman, who commended the president for his continued support for local manufacturing, said currently, only 10% of Uganda’s cotton undergoes value addition, a figure UMA aims to significantly increase.
“UMA is strongly ready to support primary industries like the textile we are talking about. When you talk of textile, Uganda is producing 150,000 bales of cotton and out of this, only 10 percent gets value addition and exported. The 90 percent is left as cotton,” he said.
Kayemba pointed out that from the 50 percent where Uganda textile manufacturers add value, they earn $50 million.
“So, if we took the 90 percent and added value to it, this industry would transform this country, and lead to the establishment of a blossoming textile industry,” he said.
1 MILLION EMPLOYED
Kayemba further noted that the manufacturing sector employs around 1 million people directly and 4.5 million indirectly, thus contributing significantly to the economy.
He added that manufacturers consume 70 percent of Uganda’s electricity, with a peak demand of 1,000 megawatts.
Kayemba shared UMA’s commitment to advancing Uganda’s economic goals, including the ambitious target of expanding the economy from $55b to $500b.
The UMA Board chair also expressed confidence that with government support, the manufacturing sector, particularly textiles, can be a cornerstone of Uganda’s economic growth.
“UMA aims to significantly boost local production, create jobs, and enhance Uganda’s global competitiveness in the textile market,” he noted.
KACITA REACTS
KACITA Uganda, a local body of Ugandan traders called the imposition of taxes on textiles unjust and uncalled for. There is an argument that, the “Firstly, locally manufactured materials can only supply about 3% of the total local market demand, let alone the fact that some of these materials are re-exported. This therefore means that about 97% of the local demand will not be satisfied,” said Isa Ssekitto, the KACITA spokesperson.
He further pointed out that some materials for curtains, polyester and materials for sofa sets, are not part of what is produced locally, but again they are part of the merchandise which has been technically locked out because of taxation.
“These materials which are imported are not brought into the country as final products; they are used as raw materials for further production. They are used to make suiting garments, garments for brides, dresses, school uniforms, sofa sets and a variety of other products,” he said, adding that a lot of Ugandans are employed in these different value addition jobs.
“This therefore means that when you stop the importation of these materials, you inevitably fail the related jobs; therefore, the tailors, carpenters and so many other related jobs will have been rendered jobless.”
