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Local employees work at a mobile phone assembly factory owned by a Chinese company in Uganda on November 22, 2019 (XINHUA)

While addressing the nation at the Labor Day ceremony 15 years ago, Ugandan President Yoweri Kaguta Museveni advised Ugandans to emulate China by establishing industrial parks and promoting cottage industries.

He vowed to ensure that all regions in the country would get industrial parks as one of the means of fighting against unemployment and poverty, especially among the youth.

Since then, efforts have been made to establish industrial parks. The dream that Museveni had back then is gradually becoming a reality, with a number of industrial parks being established across the country. All the industrial parks in the country have a Chinese connection.

According to figures from the Uganda Bureau of Statistics, at least 2 million jobs have been created since the industrial park program came into existence, benefiting mostly the youth who were previously idle in rural villages.

According to the Ministry of Finance, Planning and Economic Development, industrialization through the establishment of industrial parks is critical in the government’s efforts to make the country a middle-income country.

Evelyn Anite, State Minister for Privatization and Investment, said in an interview, “Through industrial parks, Uganda is increasingly encouraging the establishment of manufacturing industries that provide jobs to unemployed youths.”

To show its seriousness in supporting those who want to set up factories, in December last year, the government approved a plan to extend power transmission lines to the industrial parks across the country as one of the initiatives for investors.

“In the past few years, the government has put in place over 25 industrial parks in different parts of the country in efforts to promote industrialization,” said Anite.

These industrial parks attracted many Chinese investors. According to wholesale trader Amon Mbabali, more than 50 percent of factories in the industrial parks in the country belong to Chinese.

Chinese cooperation

One of the most successful industrial parks established recently in Uganda by Chinese investors is Liao Shen Industrial Park, located in Kapeka Village in central Uganda’s Nakaseke District, more than 60 km from the country’s capital Kampala.

Liao Shen Industrial Park is managed by China’s Zhongda Group and Zhang Group. The park was the first to open back in June 2015.

“Since the park was established in that remote part of the country, farmers in that district now have steady markets,” said Annet Kalibala, a trade officer in Nakaseke District. She said the park is designed for big enterprises to develop and it is on a 259-hectare piece of land.

The industrial park is expected to host 49 diversified industries, including a car assembly plant and many others with a total investment of more than $600 million.

Among other factories at the park is a corn processing factory managed by Yale Investment Co. According to Brian Mungoma, an accountant at Yale Investment, the factory has the capacity to handle 7,000 tons a day, so farmers are never worried about lack of market or production.

Ho and Mu Food Technology Co. is another Chinese company at Liao Shen Industrial Park, which owns a fruit processing factory. According to the company management, they also provide technical support, marketing and product development to different farmers involved in promoting commercial agriculture. It employs 500 workers, mostly youth.

Goodwill Ceramic Co., located in the same park, was opened and commissioned on September 30, 2018. The factory covers a land area of 10.5 hectares. The company, which was established in 2017 with an investment capital of $30 million, commenced production in April 2018 with an output capacity of 40,000 square meters of tiles per day. With the factory, Uganda now saves $35 million per year that would have been used to importing tiles. The factory employs 2,000 skilled and non-skilled employees, mostly youths from the area.

Edward Kayongo, LC1 Chairperson for Kapeeka Town in Nakaseke District (LC1 is the classification for people with upper limb disabilities), said all the youths who were wasting time on gambling are now working in the factories. He said that even women now benefit by cooking food for those who work in the factories in industrial parks. “The demand for food, accommodation and transport, among others, is high. People now make food, knowing they are going to feed factory workers,” said Kayongo.

While visiting the industrial park on January 28, 2020, Museveni said the industrial park is proof that progress in rural areas is possible.

“When such industrial parks are put in place, jobs are created. Many youths are now employed in this industrial park which is good for development,” he said.

Museveni said the industrial park was also made possible by a deliberate policy to promote liberalization, enabling private investors to invest money where they see opportunities.

“We are also making a case for market integration so that ultimately, these products have an adequate market. It explains our push for a vibrant East African community and strong links with partners like China and the EU, among others,” he said.

Benefits for local entrepreneurs

Museveni also lauded Zhang Hao, Managing Director of Liao Shen Industrial Park, who is steering the park’s development. “I am also happy to note that the factories here are contributing to value addition, buying maize, mangoes and other fruits from the [local farming] population,” he said.

Aloysius Mukasa, 24, works in a plastics factory in China-Uganda Mbale Industrial Park, located more than 200 km from the capital Kampala.

“Before this industrial park was established, I was unemployed. I use to spend most of my time playing Ludo and gambling. But now I am employed and have been able to start a family,” said Mukasa.

Tiles dealer Yowana Kafuluma said he used to import tiles from Europe.

“But now I simply drive to the industrial park and I get all the tiles I need for my shops all over the country. The tiles made in the factory are of excellent quality,” he said.

He praised Museveni for being foresighted and encouraging establishment of industrial parks in the country. “Because of his wisdom, many items which used to be imported are now made here,” said Kafuluma.

Osman Okello, an orange and mango farmer in east Uganda’s Soroti District, said he is a happy man. “Ever since a fruit factory was established in Soroti Industrial Park, I’ve earned enough money from the sales of oranges and mangoes.”

Meanwhile, Li Yang, a Chinese staff member of a paper factory in Mukono District in central Uganda, said that he has no regret of coming to work in Uganda. Li said that although the company he works for is owned by Chinese, 90 percent of people who work there are Ugandans.

The government said the rate at which the manufacturing base is expanding is unprecedented. Last financial year, which ended in June 2021, a total of 168 manufacturing factories had been built.

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      On December 12, 2018, Counselor Zhao Xiufen from the Economic and Commercial Counselor’s Office of the Chinese Embassy in Uganda visited Liaoshen Industrial Park to investigate the construction of the industrial park, and held talks with Zhang Hao, chairman of Liaoshen Industrial Park, and investors of enterprises entering the park .

     After visiting the park and various factories, Counselor Zhao Xiufen held talks with the enterprises in the park in the conference room of Wangkang Ceramics Factory. Zhang Hao, chairman of Liaoshen Industrial Park, introduced to Counselor Zhao the basic situation of the production industry, operating conditions and construction period of the enterprises in the park. Counselor Zhao expressed his satisfaction with the investment promotion progress and construction speed of the industrial park, and expressed his support and appreciation for the companies entering the park to invest in Africa and land in Uganda. She said that the Liaoshen Industrial Park is currently the fastest growing industrial park and is currently leading the development of Uganda’s industrial park construction and has played a leading role in Uganda’s industrial development. She hopes that the Liaoshen Industrial Park will continue to work hard and strive to become a leader in the construction of African industrial parks. model.

      Counselor Zhao pointed out in the meeting that after the Beijing Summit, the Chinese government has actively implemented and increased its support and development for Africa, and assigned tasks to embassies of various countries to vigorously support the development of overseas cooperation zones, especially the development of African private overseas cooperation zones, and encourage Chinese enterprises “going out” should actively pay attention to Chinese private investors in Africa and solve the practical problems and difficulties faced by Chinese private enterprises in Africa.

       Chairman Zhang Hao thanked the embassy for its encouragement and help to the park, and responded to Counselor Zhao and the Economic and Compassionate Office. Investors in the park also shared their own opinions on the establishment of industrial parks and some practical problems faced by Chinese companies setting up factories in Africa. In the process of setting up a factory, experience in dealing with problems encountered. During the meeting, the embassy focused on recording the problems that the company still hadn’t solved, or had solved before, but it took a lot of manpower and material resources to solve them. The embassy listened carefully and recorded them one by one. Counselor Zhao said that the embassy in Uzbekistan and the Counsellor’s Office will actively report these issues to the Chinese government and various departments, and strive to simplify the procedures for Chinese companies to invest and set up factories abroad as soon as possible, provide Chinese investors in Uzbekistan with extensive and high-quality financing platforms, and reduce China’s Investors make efforts to invest production costs in Uzbekistan.

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