Landmark entrepreneurial report introduces new monitoring index

January 28, 2025 in Business by Editor

Mwebesa placed his signature on the document to officially launch The State of Entrepreneurship 2024 early this week in Kampala.

Sustained growth of micro, small, and medium enterprises (MSMEs) who dominate Uganda’s entrepreneurial landscape, will require simplified registration processes, more digital literacy, better access to affordable financing, and tailored support for underserved groups such as women, youth, and persons with disabilities.

Officiating at the launch of State of Entrepreneurship in Uganda 2024, Francis Mwebesa, the trade, industry, and cooperatives minister said early this week, “Given the role MSMEs in Uganda play in generating employment and enhancing GDP, it is imperative to understand the landscape, profiles, critical barriers, and growth drivers of MSMEs, particularly access to finance and the role that the private sector can play to support their growth.”

The publication is a landmark report offering a comprehensive assessment of Uganda’s entrepreneurial landscape. It was compiled by the Ministry, in partnership with the Mastercard Foundation, IPSOS, and the Ichuli Institute. According to officials, the collaborative approach behind the report unites policymakers, financial institutions, and development partners to align efforts and foster sustainable growth.

Uganda’s MSMEs account for an impressive 90% of the private sector, contributing 75% to GDP and employing over three million people. Despite this critical role, the MSME sector faces systemic challenges that stifle its growth potential.

The report also introduced the National Entrepreneurship Index (NEI), which scored 57%, signaling a moderately healthy ecosystem while highlighting the need for targeted interventions.

Mwebesa said, “This report provides critical insights into our entrepreneurial sector’s strengths and challenges. The government is committed to creating an enabling environment by addressing these barriers and fostering inclusive economic growth. This collaborative effort demonstrates the transformative power of partnerships in building a resilient ecosystem.”

Uganda’s entrepreneurial strengths include Positive Attitudes (88%), Willingness to Grow (79%), and Human Capital (78%), reflecting an ambitious and optimistic business community. However, low scores in Business Linkages (24%), Technology Adoption (35%), and Business Registration (39%) illustrate systemic hurdles. Challenges such as financial instability, a digital divide affecting 53% of MSMEs, and demographic disparities—where women-owned businesses scored 56% compared to 59% for men, and youth entrepreneurs (18–30) scored 60% but lagged in registration—highlight persistent gaps.

Speaking on behalf of Adrian Bukenya, Country Director of the Mastercard Foundation Uganda, Meralyn Mungereza, the Head of Entrepreneurship & Enterprise Development at the Foundation said, “The State of Entrepreneurship Report reflects the resilience and potential of Uganda’s entrepreneurs. By addressing barriers such as access to finance, digital transformation, and market linkages, we can collectively strengthen the ecosystem and unlock opportunities for sustainable growth.”

According to Dr. Margaret Kemigisa, Director of IPSOS Africa Centre for Development Research and Evaluation, an Index score of 57%, reflects a moderately healthy ecosystem despite the significant barriers that threaten its growth and sustainability.

She said, “The index encompasses eight critical components: human capital, formality, linkages, technology, internal processes and systems, attitudes, willingness to grow, and financial sustainability. These components collectively shape the environment in which MSMEs operate and influence their growth potential.”