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Economists, Govt Differ on Middle Income Status Target

NPA Chairperson Wilberforce Kisamba Mugerwa states that through the National Development Plan-NDP II, key sectors have been identified to propel the country to middle income status. These are Agriculture, Tourism, Oil and Gas, Human Capital Development and Infrastructure.

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There are mixed feelings among economists, government planners and the general public on Uganda's capacity to attain middle income status by 2020.

Middle income countries are nations with the annual Gross National Income –GNI per capita ranging between 1,000 and 12,000 US Dollars. GNI per capita reflects the average income of a country's citizens.

For Uganda, this means that all Ugandans including children should each be earning at least 1000 US Dollars annually. Uganda's GNI per capita stands at 770 US Dollars, according to figures released by the National planning Authority. It is however projected to increase to 4,300 US Dollars and 9,400 US Dollars in 2032 and 2040 respectively.

The National Planning Authority is optimistic that the target is achievable provided the National Development Plan II is implemented as laid out.

NPA Chairperson Wilberforce Kisamba Mugerwa states that through the National Development Plan-NDP II, key sectors have been identified to propel the country to middle income status. These are Agriculture, Tourism, Oil and Gas, Human Capital Development and Infrastructure.

Kisamba Mugerwa says that with funding and commitment, Uganda is on track to attain the middle income status within the next four years.

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NPA Executive Director Joseph Muvawala says that poverty has been reduced in Uganda from 56 percent to only 19 percent, while sectors like education and health have also improved compared to the past.

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Dr Abel Rwendeire, the Deputy Chairperson planning authority states says Government workers should do their work more than ever to achieve this.

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However, James Abola, the team leader of Akamai Global, a financial and Business company says Uganda's economy needs to grow at more than 10 percent annually in order to attain a middle income status by 2020. He says the target is so ambitious.

Setting a tight timeframe and failing to achieve it will only create discouragement and disillusionment, Abola says. He adds that the National Development Plan had set 2017 as the time for achieving lower level middle income status which is not attainable.

He says Government is not ensuring that the country is kept to the path of attaining the status as it is seen by crippled service delivery and the current investments and returns.

Musa Lwanga, a researcher at Economic Policy Research Centre-EPRC states that it could take Uganda more 10-12 years to attain the status. He says the country should be able to manufacture its own products to get to the status, yet Uganda's manufacturing is low as it only contributes to 10 percent of GDP.

Lwanga also says that Agriculture cannot develop without manufacturing, adding that Uganda is failing to transform structurally as majority of labor force is stuck in agriculture other than skills development.

He says the Government should work on social development, improve on level of urbanization which is currently at about 20 percent, high literacy levels which leads to poor skills among others.

Lwanga says that the Government is heavily relying on oil production to transform Uganda, which he says will be a challenge as oil prices are unstable. He however says that if oil production starts as oil prices stabilize, it's possible for the middle income status to be attained in 2020.