BUSINESS OPPORTUNITIES IN UGANDA’S FREE ZONES

1. BUSINESS OPPORTUNITIES IN UGANDA’S FREE ZONES Presentation to the Business Delegation from Russian Federation By Richard Jabo Executive Director

2. Presentation Outline • Uganda Free Zones Authority • Definition of Free Zones • Rationale for Free Zones • Benefits to the Private Sector • Incentives under the Free Zones • Opportunities in Free Zones • Licensed Free Zones • Mapping of Free Zones in Uganda • Target markets • Types of Licences • Licensing Procedures • Conclusion

3. Uganda Free Zones Authority • Is a body corporate created under an Act of Parliament in 2014; Free Zones Act, 2014. Mandate: To oversee the establishment, management, marketing, maintenance, supervision and control of Free Zones and other related matters. VISION: To be Africa’s leading facilitator of export-oriented Investment and Trade. MISSION: To create a competitive client-centric business environment that facilitates the establishment, management and regulation of Free Zones to enhance export-oriented Trade and Industrialisation in Uganda. • CORE VALUES • Integrity • Innovation • Teamwork • Client Satisfaction • Efficiency

4. Definition of a Free Zone • A Free Zone is a designated area where goods introduced are generally regarded, so far as import duties are concerned, as being outside the Customs territory. • Customs-controlled area where • raw materials and goods may be: • Landed • Handled • Manufactured or reconfigured for export. • NOT subject to import and export duties. • They include: • Export Processing Zones • Free Port Zones • Special Economic Zones

5. Rationale for Free Zones Governments have adopted Free Zones as complementary economic development tools to: Static Benefits • Accelerate export-oriented manufacturing; • Boost Investment (Both Domestic Direct Investment (DDI) and attract Foreign Direct Investment (FDI)); • Create employment; • Increase forex earnings; Dynamic Benefits 5. Enhance technology uptake and skills transfer; 6. Create backward and forward linkages; and 7. Economic growth.

6. Benefits to the Private Sector • Fiscal and non-fiscal incentives; • Economies of scale, resulting from well-planned Zoning and clustering of the business activities. Shared facilities and services reduce operational costs; • Enhanced uptake of new technologies; • Onsite services in form of Customs clearance and Inspection, which ease movement of goods; • Business facilitation and dedicated aftercare services in the acquisition of secondary licences, permits and approvals from other Government Ministries, Departments & Agencies; • Greater access to market information and opportunities; • Serviced physical infrastructure facilities within the Zones (where the Public Sector establishes one).

7. Incentives under the Free Zones • Exemption from taxes and duties on all Export Processing Zone imported inputs that are for the exclusive use in the development and production output of the business enterprise (raw materials, plant and machinery, spare parts and intermediate goods), etc. • Tax holiday on finished Consumer and intermediate goods such as machinery, property and equipment. • Exemption from tax on income from Agro-processing.

8. Incentives (Cont’d…) 4. Unrestricted remittance of profit after tax. 5. Exemption from tax on income of a person offering Technical Assistance under a Technical Assistance Agreement. 6. Exemption from VAT on supply of selected services such as supply of medical equipment and dairy equipment as provided for in the VAT Act, etc. 7.Exemption on income derived from the operation of aircrafts in domestic and international traffic or the leasing of aircrafts.

9. Licensed Free Zones

10. Licensed Free Zones (Cont’d…)

11. Opportunities in Free Zones • Establishment of Free Zones with Physical and Industrial Infrastructure Development. • Manufacturing (Textile/Apparel, Leather products, Iron and Steel, Mineral processing, Oil and Gas, Pharmaceuticals). • Agro processing (Food, Beef, Dairy products, Fish, Fruits, Honey, etc. ) • Trade and services such as Logistics, Insurance, Transportation, Consultancy etc.

12. Proposed Government-Owned Free Zones Source : UFZA Notes: Actual Cost for all the 3 sites will be informed by a Feasibility studies UFZA has land offer of 20 acres by UIA in Jinja, Soroti and Kasese Industrial Parks

13. s Map Showing Potential Areas for Free Zone Development ARUA GULU MOROTO SOROTI MBALE HOIMA TORORO KASESE JINJA f f KAMPALA MBARARA ENTEBBE MASAKA

14. Target Markets Uganda has negotiated preferential market access to the following blocs: • European Union • USA   • Middle East and Asia • Other African markets (COMESA, EAC and SADC).

15. Types of Licences issued by the Authority

16. Setting up in a Free Zone in Uganda UFZA works with the Developer/Operator throughout this process

17. Conclusion The Uganda Free Zones programme enables you to grow your current business, take advantage of the opportunities and incentives while giving you the market gateway to not only into central Africa but other markets in COMESA, SADC, Asia, Europe and USA. The Uganda Free Zones Authority is committed to supporting the Private Sector to ensure gainful impact for Government and the Private Sector.

18. Contact Us Uganda Free Zones Authority 6th Floor Communications House, Plot 1 Colville Street, P. O. Box 37578, Kampala Tel: +256 417 722 600 Email: info@freezones.go.ug www.freezones.go.ug Uganda Free Zones Authority @freezonesug