A Kenyan Investor On Doing Business In Uganda

The Uganda Investment Authority (UIA) outlines adequate investor information as the first step, when starting a business in Uganda; however the process can be slow and expensive.

For James Mugo a Kenyan investor of the Prestige Company, the process was smooth because he was not obliged to undergo mandatory regulatory obligations.

However, he found challenges when it came getting investment capital.

Mugo, who started the driving school in 2003 with only one car, has a fleet of cars and employs over 50 people.

Sheila Mugyenzi, Senior Investment Executive at UIA, explains that after making an investment inquiry, the potential investor is required to register with Uganda Revenue Authority, which may take one and half to two days.

Mugyenzi explains that before a business is approved it the plan should show an investment capital of 100, 000 USD equivalent to at 257,500,000 UGX for foreign investors, and 50,000 USD or 128,750,000 UGX for Ugandan citizens.

Getting a license from the Uganda Investment Authority may take three to four days as long as the sector does not have regulatory obligations. In total, there are about 10 procedures which vary for different investments. She adds.

Mugyenzi says sometimes it is necessary to support investors when they face challenges in the new business environment.

However the 2013 Doing Business Report points out that the EAC countries have so far implemented 10 regulatory reforms aimed at reducing on time spend to establish a business.

According to the report this will encourage entrepreneurs in the region.

When it comes to the ease of doing business, the EAC economies vary. Rwanda is ranked 45th globally in the ease of doing business, followed by Kenya (109th), Uganda (123rd), Tanzania (127th), and Burundi (169th).

The EAC economic policy recommends that countries should strive to ensure that investors take as little time as possible, from the time of making the initial inquiry to the time a business is up and running.

According to 2013 doing business index, it takes 3 days to start a business in Rwanda , Burundi takes 8 days, Tanzania 26 while Kenya and Uganda and are the slowest with 32 and 33 days respectively.