TRENDS AND IMPACTS OF FOREIGN INVESTMENT IN DEVELOPING COUNTRY AGRICULTURE

TABLE 1
Investment incentives, Uganda
Incentive Description
focuses on creating an enabling environment for
all private sector players to engage in agricultural
production. In view of this, the government set
up measures to control the quality of agricultural
products and the enforcement of quality standards,
in order to ensure food safety and compliance with
international standards.
Under the PMA Policy, the government
identified seven priority areas that would create
domestic capabilities and maximize benefits
from the participation of TNCs. The areas
include: agricultural research and technology
development; agricultural advisory services;
rural financial services; agricultural education;
agricultural marketing and agroprocessing;
sustainable natural resources management; and
supportive physical infrastructure. These key areas
Part 3: Policies for attracting FDI and impacts
on national economic development
Investment Capital Allowance Initial allowance on plant and machinery (50-75 percent)
Start-up cost spread over 4 years (25 percent p.a.)
Scientific research expenditure (100 percent)
Training expenditure (100 percent)
Mineral exploration expenditure (100 percent)
Initial allowance on hotels, hospitals and industrial buildings
Deductible annual allowances (depreciable assets)
Depreciation rates of assets range (20-40 percent)
Depreciation rates for hotels, industrial buildings and hospitals (5 percent)
VAT Refunds Investors who register as investment traders are entitled to VAT refund on
building materials for industrial/commercial buildings
Duty and tax free import of plant and machinery
First Arrival Privileges (FAPs) FAPs in the form of duty exemptions for personal effects and motor vehicles
(previously owned for at least 12 months) to all investors and expatriates coming
to Uganda
Export Promotion Incentives and facilities Manufacturing under bond
Duty exemption on plant and machinery and other inputs
Stamp duty exemption
Duty drawback – a refund of all or part of any duty paid on materials, inputs
imported to produce for export
Withholding tax exemption on plant and machinery, scholastic materials, human
and animal drugs and raw materials
Ten year tax holiday – duty remission scheme for exporters involved in value
addition
Source: Uganda Investment Authority (UIA)
are to be implemented through the coordination
of the various relevant ministries.
Incentives offered to encourage private
investment in agricultural sectors
Uganda has an open investment climate with
regard to foreign investment. The Ugandan
Government has in place a number of specific
incentives for investors (both foreign and
Ugandan). The main criterion for investors to
benefit from these incentives is a minimum initial
capital investment of US$500 000 for foreign
investors and US$50 000 for Ugandan investors.
The investment incentives that apply to all
investment are provided in Table 1.
Uganda has a number of obligations under
international law that are relevant to the fisheries
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