WTO TRADE POLICY REVIEW OF UGANDA
Statement by U.S. Ambassador Linnet Deily
December 18, 2001

Opening Remarks:

Thank you Mr. Chairman. The United States welcomes the delegation from Kampala to the WTO Trade Policy Review of Uganda . We commend the Secretariat for its report on Uganda's trade policy regime. We also greatly appreciate the Government's report as well as the report from the discussant today. These reports can be helpful not only in understanding and improving trade policy formulation and coordination, but also in the process of helping to integrate trade into national development strategies. We have produced a series of questions stemming from those reports and anticipate obtaining answers to these questions from Uganda and learning more about Uganda's trade liberalization policies and practices during this review.

The United States and Uganda have developed solid economic ties which are being strengthened. United States imports from Uganda were more than $ 29 million dollars in 2000 with U.S exports to Uganda around $ 28 million. Expanded trade with Uganda and other sub-Saharan African countries is also a goal of the African Growth and Opportunity Act (AGOA) of 2000, which allows Uganda to export a wider range of products to the United States duty free. The AGOA has significantly expanded market access for countries in Africa and should assist in Uganda's efforts to further diversify exports.

In recent years, U.S. economic assistance to Uganda has totaled more than $60 million annually. In addition to working together to increased the production of subsistence crops and diversify and expand non-traditional agricultural exports, the U.S. and Uganda have taken steps to support micro enterprise development, and increased access to financial services. We have also jointly supported improved resource conservation policies, slowed the transmission of HIV/AIDS, increased the availability of teachers in the classroom, and supported improved legal education and training.

Uganda's economy has great potential. Uganda is endowed with significant natural resources, including ample fertile land, regular rainfall, and mineral deposits,
Although Uganda is a least-developed country, it is making notable increases in economic growth. Over the past six years, the average growth rate of real GDP has been around 6% per annum. Growth over the past ten years has occurred across a number of sectors such as manufacturing, mining, transport, communications, and construction - nearly doubling the size of the Ugandan economy. In spite of a significant fall in the price of its major export, coffee, Uganda's GDP grew 4.7 percent in 1999/2000 and is expected to grow by 5 percent in 2001.

Uganda is a leading economic reformer in Africa. It has achieved macro-economic stabilization. Privatization and civil service reforms are proceeding, and the budgetary process is more transparent. The government is working to rebuild the country's infrastructure, and is creating a national road grid. Monopolies in the coffee, cotton, power and telecommunications sectors have been abolished. Uganda has consistently welcomed foreign investment. In May 2000 Uganda was the first African country to reach its HIPC completion point. It has a long-established Poverty Eradication Action Plan and a Poverty Action Fund. Uganda is one of the first countries in Africa to show a sustained decline in HIV/AIDS prevalence.

Uganda and the WTO

Mr. Chairman, the United States and Uganda share a commitment to the
objectives of the WTO. Uganda is a founding member of the WTO. However, we recognize that trying to meet its WTO obligations has at times posed a considerable challenge to Uganda and agree that outside assistance can be critical for participation in WTO activities. We are committed to providing effective technical assistance to Uganda both bilaterally and multilaterally.

In October President Bush announced the Trade for African Development and Enterprise Program. With $15 million in initial funding, this new, multi-year trade capacity building initiative will promote regional integration and cooperation by strengthening the ability of African countries and businesses to develop their export trade.

The United States attaches great importance to the implementation of the WTO Agreement on Customs Valuation as a fundamental trade facilitation issue. For many developing countries implementation of the Agreement can be a simple, -- yet important-- concrete step towards meaningful customs reform. We were therefore pleased that, as of June 2001, Uganda discontinued its mandatory preshipment inspection system and converted to the transaction valuation of imports in accordance with the WTO Customs Valuation Agreement. We applaud Uganda's effort in this area.

On Going Matters of Concern

Uganda has made considerable progress, but still has significant structural economic problems. The Secretariat's report notes that there is insufficient infrastructure, and its various institutions dealing with trade policy do not have sufficient capacity to manage trade arrangements effectively and to fully implement the necessary reforms.

The Secretariat's report notes that Uganda's tariff bindings cover 15.4 percent of all its tariff lines and 2.7 percent of total lines for non-agricultural products. We encourage Uganda to increase the coverage of bound tariffs which would further increase the predictability of market access conditions.

Uganda has placed great emphasis on private sector development as a major engine for economic growth, but unfortunately, the privatization process has slowed.
We urge Uganda to move forward with privatization of the Uganda Electricity Board and other such entities. We also urge the Uganda government to continue to move forward on the deregulations program which has been launched to dismantle "unnecessary" licensing and regulatory procedures.

CONCLUSION

Mr. Chairman, Uganda has continued to follow a policy of liberalization to stimulate economic growth and encourage the private sector. This has had some very favorable effects. However for Uganda to continue to achieve high growth rates existing weaknesses need to be addressed. The Government's trade policy is already focused on export diversification and promotion and bringing all trade related laws, regulations and procedures into conformity with WTO requirements. These actions need to be further encouraged and strengthened. We support Uganda's efforts to continue to expand its liberalization efforts in order to increase the momentum towards economic development.

We look forward to discussing Uganda's trade policies and practices with other delegations during this review.