Decade of growth between China and Uganda

17 january 2013

A growing Chinese business presence has brought not only goods and services but also better infrastructure and job opportunities to the East African nation, reports Liu Xiangrui from the capital, Kampala

Charles Lwampa said he hears the greeting “Nihao” often on the streets of his hometown.

The 28-year-old resident of Kampala – the capital, and largest city in Uganda, East Africa – has been working for the past six years for a Chinese company, and said the Chinese influence has grown rapidly in that time.

In various parts of the city, which has a population of around 1.7 million, many Chinese businesses have knitted themselves firmly into the local community.

Chinese businesses have brought new goods, new technologies, and even introduced new culture to a city and country which only a few years ago, were considered among the world’s poorest and least-developed, he said.

They have been warmly welcomed, too, because Kampalans recognize just what an important ingredient their presence has become to the local economy.

According to the latest estimates, more than 10,000 Chinese have been involved in bringing different business activities to the East African country in recent years.

“These Chinese investors are helping the Ugandan people live the dream of social transformation,” said Lwampa.

“We didn’t even have many good buildings in this town 10 years ago. But just look at the growth we have experienced in our local infrastructure.

“This is what Africans need right now. Every bit of investment helps African people, and if the Chinese want to double their level of investment, we would welcome that.”

The Chinese influx has been dramatic, especially over the past decade, and it’s no coincidence that Uganda too has experienced rapid modernization in that period, as the economic and trade ties grew stronger between the two nations.

In 2005, Chinese investment in Uganda was limited to a few hotels and restaurants. But within just five years, China had become the country’s second-biggest trading partner after the United Kingdom.

Statistics from the Chinese customs department show that China-Uganda trade was worth $400 million in 2011, and the planned investment portfolio is now estimated at $2 billion.

Ugandan statistics show that in the same year, the country’s gross domestic product was $18 billion, a 5.9 percent year-on-year rise on 2010.

More than 260 Chinese companies have now opened in the country, across different sectors, creating 30,000 local jobs.