Will Uganda’s Underfunding Effect Its Technological Growth?

Uganda ICT
East Africa has a booming ICT sector

The Ugandan government needs to get with the times if it is to avoid falling behind in the region’s ICT revolution, as it broke with its neighbours by reducing the sector’s budgetary allocation for the next year in spite of the country’s growing capabilities in technology and innovation.

Though it had previously promised an increase in funding, the government cut the ICT budget last month, allocating it a mere 0.1 percent of the country’s Sh11.1 trillion ($4.5 billion) budget. This came despite criticisms that the 0.2 percent of funds spent on the sector in previous budgets was too low. Already one of the least funded sectors, Ugandan technology is set to be badly hit by the reduction in funding, a decrease which suggests the government is blind to the potential offered by tech development in the region, which is driving economic growth.

ICT stakeholders are justifiably furious. “It is contradictory that ICT is the main driver of growth and yet all the revenues IT generates are taken away,” said Geoffrey Mutabazi, executive director of the Uganda Communications Commission (UCC). “How do you expect the industry to grow when you are not investing back?”

The move is in sharp contrast to the steps being taken elsewhere in the region, particularly in Kenya and Rwanda, to further aid their booming ICT sectors. Kenya has put technological growth at the centre of its Vision 2030 and heavily funds the sector, while Rwanda’s 2012-2013 National Budget Framework Paper boosted ICT by awarding the infrastructure sector, which includes telecommunications, a mighty 23.3 percent of the total budget. This increased funding reiterates the Rwandan government’s commitment to developing the technology sector in the country, after it opened a tech incubator in Kigali and invested large amounts in communications. Uganda’s step back from tech investment is in sharp contrast to its rapidly developing neighbour.

This blow is one that Ugandan technological development scarcely deserves, and makes it seem even more nonsensical. A study by the Martin Prosperity Institute in the United States placed Uganda second in a list of African countries with advanced technological and innovation capabilities, only after South Africa. Upon this announcement, minister for information and communications technology Ruhakana Rugunda rather ironically declared: “Government’s policy towards ICT is good. Accessing internet is at low cost. The ministry is trying increase more infrastructure in this sector.” Yet the annual budget clearly suggests otherwise, and risks Uganda falling behind Rwanda and Kenya in the race to the tech summit.

Perhaps the private sector could yet step in to bridge the funding gap. But if it does not, Uganda will fall behind in a race it has the potential to win and cannot afford to lose.