Nathan-MSI Group - Foodnet

hours of their receipt. Foreign customers will need assurances that you are on top of their orders,
and will want to know when it expects to ship. Because of the time zone difference, it is
advisable to have someone in the firm who works “New York hours” – at the plant or from
home, as necessary – in order to be by the phone during the customer’s work day.
THE WAY FORWARD
Seeking Foreign Investment
Where will those investment dollars come from? It is less likely that U.S. textile and clothing
firms are going to invest directly in Uganda. U.S. textile companies are investing in large-scale
projects directly overseas in Mexico/the Caribbean and Asia, in countries which offer excellent
working conditions, proximity to the U.S., and stable political and economic environments. They
are aware of AGOA and Africa’s potential, but they are extremely reluctant to risk assets in
countries with insurgent movements and high health risks.
On the other hand, it is much more likely that U.S. firms will strike commercial partnerships of
one form or another with existing enterprises that pass initial competitiveness criteria (McMillan,
Pandolfi, and Salinger 1999). Here, the problem for Uganda is that the American clothing buyer
can source garments from existing companies experienced in large-scale production and
shipping, where full-package services – meaning local fabrics, trims and findings, finishing
services, and skilled freight forwarding – are all available locally. The fact that Kenya, Lesotho,
Madagascar, and South Africa are already exporting successfully to the U.S., while it means
increased competition for Uganda to gain access to the AGOA cap, is useful in that it creates a
positive impression of Africa’s capabilities in American buyers’ minds.
Other potential foreign direct investment (FDI) sources include Asians, South Africans, and
Mauritians. Kenyan firms relocated into Uganda when export quotas were imposed by the U.S.
on Kenya, and are another possible source of investment. This will likely be tempered by the fact
that export quotas from Kenya have been removed. However, Uganda must bear in mind that it
competes with all countries of the world to attract FDI resources. Many other countries offer
attractive incentives to induce firms to locate inside their borders. Uganda has not pursued these
as aggressively as others.
Strategic Emphases For Uganda
Ugandan authorities have already established an AGOA coordination committee, comprised of
government and private sector representatives. It consists of the Ministries of Trade, Foreign
Affairs, Agriculture, Justice, and Finance; the Uganda Investment Authority; the Export
Promotion Board; the Uganda Revenue Authority; the Uganda Textile Manufacturers’
Association; the Uganda Women’s Entrepreneurs Association; the National Bureau of Standards;
the Chamber of Commerce and Industry; the Private Sector Foundation. It is chaired by the
Minister of State for Trade.
The next step would be for the Government of Uganda to declare AGOA a priority area of
interest, acknowledging the need to integrate agriculture and industry in this effort. While some
investment and operational advantages are accorded to agricultural sectors deemed of key
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