Uganda Launches Investment Reform Program Supported by World Bank Group

The World Bank Group and the government of Uganda announced today that Uganda has launched a four-year program to simplify, improve and reform its business and investment regulations to stimulate broad economic growth, especially the growth of smaller businesses.

The reform program, supported by the World Bank Group, will focus on reducing regulatory costs and risks associated with obtaining business licenses, and on simplifying and reducing taxes for small and medium enterprises. The program will also study investment generation – including support for Special Economic Zones and investment policy and promotion – as well as broad regulatory reform.

Uganda’s Minister of Finance, Planning and Economic Development, Hon. Syda Bumba, said, “We have seen first-hand the work done by Zambia, Kenya and other governments in cutting red tape, with the help of the Investment Climate team of the World Bank Group. We are therefore requesting similar support for our business regulatory regime.”

Peter Ladegaard, East and Southern Africa’s Regional Program Manager for the Investment Climate Advisory Services of the World Bank Group, said, “We want to bring our full support and expertise to the government of Uganda to enable it to pass reforms that will have a significant and positive impact on the creation and growth of its enterprises.”

Uganda’s legal and regulatory regime is cited as one of the biggest challenges constraining the country’s private sector. A recent World Bank Group study of Uganda’s business licensing regime puts the annual private sector regulatory compliance costs at $175 million per year, which represents 1.3 percent of the country’s GDP.

A World Bank Investment Climate Assessment, also launched today, shows that tax policy and administration and licensing issues rank among the top 10 investment climate challenges affecting Uganda. The country ranked 122 out of 183 economies in the 2011 Doing Business Report, a World Bank and IFC survey of global business regulations and their enforcement.

The World Bank Group supported reform program will work to address the challenges holding back private sector growth in Uganda. It aims to reduce the overall regulatory burden and risk to business by 25% by 2014, and lead to the broadening of the tax base through enhanced SME tax compliance.

This article was originally posted on East Africa Business Communities

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