Last month, Uganda extended the deadline by six months to September 2020 for applications for those who wish to explore six blocks in the Albertine region. The report notes that “the fall in commodity prices—especially crude oil, metals, and minerals—will not only reduce their export proceeds but also slash the amount of financing brought by foreign investors.”
Uganda will find it hard to get investors o explore in Albertine region as companies are saving it up cash for priority areas
have been receiving money in the form of investment in exploration activities –
Search for minerals – like Uganda will see this dry up as companies cut their
spending due to the impact of the Coronavirus (COVID-19).
according to the World Bank’s latest Africa Pulse report for April 2020. The
report paints the gloomiest picture of Sub-Saharan Africa, showing the sub-continent
will fall into recession for the first time in 25 years.
countries like Uganda in the market to get investors to explore the existence of
her minerals will face it even tougher. Last month, Uganda
extended the deadline by six months to September 2020 for applications for
those who wish to explore six blocks in the Albertine region.
notes that “the fall in commodity prices - especially crude oil, metals, and
minerals - will not only reduce their export proceeds but also slash the amount
of financing brought by foreign investors.”
already indicators that investors are fleeing. Mining giant Rio Tinto has cut
short its plans to invest up to USD 57 million in Uganda’s copper project in Kitgum,
according to its partner Sipa Resources Limited.
it also means its plans to export oil by at least 2023 are tampered with – as
it may not happen. When it
comes to remittances – the money sent by Ugandans living abroad – it will nearly
come to zero as most source economies like the USA, the UK and UAE have literally
shut down. Uganda receives
up to 4 per cent of GDP in remittances annually by Ugandans abroad.
notes that COVID-19 will heavily affect aid flow to countries like Uganda. This
is because “as major donors are now at the epicentre of the COVID-19 outbreak
and their governments will deploy their resources toward protecting the
vulnerable segments of the population that are being affected by the economic
consequences of the pandemic.”
the report talks about tourism that has been hit hardest. For Uganda, tourism
accounts for at least 20 per cent of export earnings at an average of USD 1.4 billion in earnings
these earnings will be cut to negligible levels as all non-essential travels
around the world have been prohibited.
As the fall in
the export earnings continue, the report says countries with the largest
external imbalance including Mozambique, Niger, Liberia, Guinea, Mauritania,
Burundi, Sierra Leone, Uganda, and Sudan, face pressure for the domestic
currency to weaken.
Uganda has said Uganda will only manage to grow by a paltry 3 Per Cent this year, compounding
the hard times that await the country. If
COVID-19 crisis drags on longer, this growth will be cut down further.