Strategy for agricultural marketing and agro-processing ... - Foodnet
Strategy for agricultural marketing and agro-processing ... - Foodnet
Strategy for agricultural marketing and agro-processing ... - Foodnet
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involving stakeholders in the private, public <strong>and</strong> parastatal sectors. Furthermore, it will develop<br />
the capacity of key staff in the concerned public sector bodies (principally the Ministry of<br />
Tourism, Trade <strong>and</strong> Industry – see below) both to negotiate international, regional <strong>and</strong> bilateral<br />
trade agreements in teams <strong>and</strong> to undertake thorough analyses of trade issues. (This will include<br />
monitoring the impact of trade agreements on different socio-economic groups). The staff thus<br />
trained will also be able to provide technical advisory services in Ug<strong>and</strong>a, on the obligations<br />
arising from international <strong>and</strong> other trade agreements.<br />
A key output of the intervention, which is scheduled to commence be<strong>for</strong>e the end of 2002, will<br />
be <strong>for</strong> the country to be adhering to a trade policy that is, clearly, both benefiting the poorer<br />
strata of the population <strong>and</strong> supporting the expansion of the private sector, particularly with<br />
regard to exports.<br />
The USAID-supported five-year U-TRADE intervention, due <strong>for</strong> implementation in late-2002,<br />
will provide further support in this area. In particular, it will assist the Government in<br />
developing a viable trade <strong>and</strong> investment policy <strong>and</strong> strategy, as well as in reviewing <strong>and</strong> in<br />
revising, as necessary, the national export strategy. It will also assist the government in<br />
improving the national legal <strong>and</strong> regulatory framework to promote <strong>and</strong> facilitate export growth.<br />
The problem caused by the lack of co-ordination within the Government over trade negotiations<br />
requires immediate action. As far as institutional responsibilities are concerned, the Ministry of<br />
Tourism, Trade <strong>and</strong> Industry will, hence<strong>for</strong>th, be the body ultimately responsible <strong>for</strong> negotiating<br />
all trade agreements. Associated with this, the same Ministry will be responsible <strong>for</strong> developing<br />
channels of communication such that rapid but considered positions, can be relayed to the<br />
relevant decision makers <strong>and</strong> thereafter to the teams negotiating in <strong>for</strong>eign capitals.<br />
(ii) Increased trade finance<br />
Under the Medium-Term Competitiveness <strong>Strategy</strong>, the Government is seeking to re<strong>for</strong>m the<br />
financial sector to increase the ability of private businesses to access capital at reasonable cost<br />
<strong>and</strong> to cater better <strong>for</strong> small- <strong>and</strong> medium-sized enterprises.<br />
Another important intervention, in this field, which would result in a reduction in transaction<br />
costs is the establishment of a commodity exchange <strong>and</strong> warehouse receipts finance/inventory<br />
credit system in the country. Recent assessments have shown that such interventions<br />
undoubtedly have the potential <strong>for</strong> transparency to be enhanced <strong>and</strong> market efficiency to be<br />
improved, resulting in reduced transaction costs. They will also provide greater liquidity at the<br />
rural end of commodity supply chains. For these reasons, a plan of action covering these<br />
components is currently being drawn up in the Ministry of Tourism, Trade <strong>and</strong> Industry; it is<br />
being supported by development partners. Thus, the establishment of both a commodity<br />
exchange <strong>and</strong> warehouse receipts financing system can be expected shortly.<br />
(iii) Improved rural contract law<br />
Steps have been taken under the MTCS to improve commercial contract law <strong>and</strong> the associated<br />
judicial procedures, such that contract en<strong>for</strong>cement procedures are better tailored to the needs of<br />
rural communities . However, there are doubts that contracts can be easily en<strong>for</strong>ced in rural<br />
areas due to the generally-low level of awareness <strong>and</strong> the poor communications. This is an area<br />
requiring further concerted ef<strong>for</strong>t under the Medium-Term Competitiveness <strong>Strategy</strong>.<br />
4.2.2 Producer support<br />
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