In 2023, Uganda launched an ambitious growth strategy to expand its economy from USD 50 billion to USD 500 billion by 2040. This ‘ten-fold growth strategy’ is anchored on agro-industrialization, tourism, mineral development, and science and technology innovation (ATMS) to accelerate growth. Achieving this bold ambition could elevate Uganda to one of the most dramatically transformed economies in recent history, akin to Singapore’s meteoric rise and ‘economic miracle’. However, ambition and ATMS alone are insufficient. Prudent fiscal management, improved investment efficiency, stronger governance, and an unwavering commitment to tackling corruption are essential for cultivating a genuinely business-friendly environment to catalyze growth.
This transformation will require doubling the size of the economy every five years, sustaining an annual GDP growth rate above 10 percent, and increasing per capita income from USD 1,039 to USD 7,000. Achieving these goals equally necessitates a surge in domestic savings from the current level of 21 percent to about 40 percent of GDP, an increase in annual foreign direct investment from about USD 3 billion to USD 50 billion, and a substantial rise in tax revenue collection. The tax-to-GDP ratio will need to be elevated from the current 13 percent to at least 25 percent. It also calls for a rapid increase in merchandise exports from 13-50 percent of GDP and an increase in exports of medium and high-tech manufactured products from 21-50 percent by 2040.
Realizing this vision also calls for prudent fiscal management and discipline - particularly overcoming the temptation to borrow for recurrent expenditures and ensuring that public debt is sustainable. Failure to do so could pose significant fiscal risks and challenges jeopardizing economic stability and long-term development. Additionally, improved fiscal governance to prevent resource misallocation and increased budgetary allocations towards targeted growth sectors such as agro-industrialization, tourism promotion, science and technology; as well as mineral development and petroleum are needed. Achieving this will require increased domestic resource mobilization, broadening the tax base, and enhancing tax compliance to align resources with the long-term development goals.
Singapore’s experience offers invaluable lessons for Uganda. In the 1960s, Singapore was a resource-poor country with challenges mirroring Uganda’s present struggles: high unemployment, nascent industrialization, and weak infrastructure. Yet, in just 25 years, its per capita GDP soared from USD 428 to over USD 88,000. This remarkable transformation was driven by strong leadership, sound governance, economic diversification, and a pragmatic approach to policy making. Under Lee Kuan Yew, Singapore implemented a zero-tolerance policy on corruption which fostered a transparent, business-friendly environment that attracted global investors. Uganda could consider adopting a similar stance against corruption and implementing institutional reforms that foster a stable investment climate.
Infrastructure development was pivotal to Singapore’s success – investment in infrastructure such as industrial parks and ports transformed Singapore into a global manufacturing and logistics hub. Uganda could similarly prioritize infrastructure expansion, by modernizing transport networks, and investing in transportation and digital infrastructure to support industrialization and enhance connectivity and competitiveness.
Human capital development through investment in education and workforce were instrumental to Singapore’s rise. Heavy investments in quality primary education, science, technology, engineering, and mathematics (STEM)—exemplified by institutions like the Singapore Institute of Manufacturing Technology (SIMTech) and the Agency for Science, Technology, and Research (A*STAR), —fueled innovation and equipped workers with the technical skills needed for a high-tech economy. The challenge for Uganda lies in undertaking a similar transformation by expanding STEM education, vocational training, and fostering stronger collaborations between academia and industry.
Beyond manufacturing, Singapore transitioned into high-tech industries like semiconductors and pharmaceuticals, biotechnology, and high-tech manufacturing ensuring long-term resilience. Similarly, Uganda would need to diversify beyond agriculture and raw materials exports to the manufacture of high-value added products through agro-processing and mineral development, finance, pharmaceuticals, and IT. A robust financial sector was another pillar that propelled Singapore into a global financial hub, attracting leading wealth, asset management, and global banking corporations. A challenge for Uganda will be reforming its financial sector to boost domestic savings and attract FDI.
Despite these valuable lessons from Singapore, Uganda faces serious structural challenges that will demand tailored solutions in the long term. A large informal sector (employing about 80 percent of the workforce) limits taxation and formalization. Infrastructure deficits, limited access to finance, and skills mismatches further constrain growth. High transport costs hinder trade competitiveness, while weak institutions and inefficient public investment management slow economic progress. These governance inefficiencies should be addressed by dismantling regulatory barriers that stifle investment, by decisively tackling corruption, and improving transparency at all levels. Overcoming these obstacles requires deep structural reforms, strengthened governance—including independent anti-corruption agencies and greater transparency in public expenditure—and a concerted effort to enhance public investment efficiency.
Uganda’s Tenfold Growth Strategy presents an unprecedented opportunity for economic transformation. By strategically adapting key lessons from Singapore—beginning with strengthening governance and tackling corruption, followed by targeted investments in education, sustainable infrastructure, and private sector growth incentives—Uganda can establish the foundation for long-term prosperity. However, success hinges on regulatory stability, investor confidence, and transparent governance.
