I.   Commercial Overview

A.   Overview of Import Market

Uganda boasts a rapidly growing economy with low, stable rates of
inflation.  The country imports most of the manufactured goods it
consumes, but the Ugandan market is a small market.  The population
is 17 million people, and average income is extremely low.  The
main areas with potential for American manufacturers are
agricultural processing equipment and participation in major
infrastructure projects funded by multilateral development banks.

B.   Brief Synopsis of Commercial Environment

Uganda has taken major strides to liberalize the economy, maintain
low inflation and allow the economy to grow, which it has done at
high rates since 1987.  The government is privatizing parastatals,
revising regulations to promote foreign investment and following
IMF guidelines to restructure the economy.  Major efforts are
underway to restructure the main banks and strengthen Uganda's
financial system.  Donors provide significant assistance toward
maintaining the economy.

C.   Host Country Business Attitude Toward the U.S.

Host country attitudes toward the U.S. are favorable, as are
business attitudes generally.  However, Uganda has traditionally
traded with nearby countries (East African countries such as Kenya)
and with Europe, especially the United Kingdom.  Imports are
increasing from Japan, indicating an openness to new trading
partners.  American manufacturers wishing to export to Uganda,
however, face a situation where buyers are comfortable with
familiar trading partners and are concerned about the ability of
American manufacturers to provide parts and service.

D.   Major Business Opportunities

The best prospects for U.S. exporters are in the food processing
industry and infrastructure projects funded by multilateral donors,
especially fruit and vegetable processing, edible oil production
equipment, grain milling equipment and cotton ginning equipment.
Good investment opportunities exist in the food and dairy
industries, wood and wood products industries, and building and
construction.  These are the areas that the Uganda Investment
Authority targeted in their June, 1994 trade mission to the United
States.

E.   Major Roadblocks to Doing Business

The barriers to doing business in Uganda include problems with
financing because of the weak financial sector, transportation
costs and poor transportation infrastructure, and the fact that the
economy is emerging from a history of government intervention and
significant government mismanagement.  Roadblocks particular to
American companies are Uganda's traditional links to East Africa
and the United Kingdom, and the fact that most development projects
are funded by outside donors and many of the donors link their
money to purchase from companies based in the donating country.

F.   Nature of Local and Third Country Competition

Uganda's level of imports of manufactured goods is high, primarily
because little is manufactured locally.  Local competition is
negligible.  Trade relationships transcend sectoral barriers and
are based primarily on traditional relationships with Europe
(particularly the U.K.) and the Middle East, along with East
Africa.