Business 7 August 2026 Daily Monitor (Uganda)
Ugandan Business Confidence Surges, Yet Demand Woes Persist
Business confidence in Uganda saw a notable jump in the second quarter of 2026, with firms anticipating improved demand and sales. Despite this optimism, challenges like intense competition and weak consumer spending continue to hinder growth. Source: https://www.monitor.co.ug/uganda/business/markets/business-confidence-rises-but-firms-grapple-with-weak-demand-5549992
Uganda’s business environment experienced a significant upswing in confidence during the second quarter of 2026. According to a report by the Economic Policy Research Centre (EPRC), the Uganda Business Climate Index climbed 20.1 points to reach 124.9, an increase from 104.8 in the preceding quarter. This surge is largely attributed to businesses projecting more favorable market conditions, including expectations of higher prices and increased sales in the near future.
However, this optimism is tempered by persistent challenges. Competition was identified as the primary obstacle, particularly for small and medium-sized enterprises operating in sectors such as wholesale and retail trade, education, and transportation. A substantial 56% of small businesses and 27% of medium-sized ones highlighted competition as a major constraint. Weak consumer demand followed closely, with 61% of companies in accommodation and information/communication sectors reporting subdued customer interest.
Other significant hurdles included unreliable electricity supply, especially for energy-intensive industries like printing and broadcasting, and delays in securing new power connections. Businesses in the construction sector, particularly small firms, faced tax-related issues such as multiple levies, high compliance costs, and stringent enforcement. Global factors also played a role, with currency depreciation and imported inflation driving up transportation and production expenses.
While areas like skilled labor availability, customs procedures, and trade regulations saw improvements, the overall business landscape continues to grapple with reduced demand, inflation, corruption, and infrastructure deficits.