Uganda Reaping Billions of Dollars From Exported Labour

Ugandans working abroad are making a fair contribution to the country’s economy by sending back home as much as $1.1 billion between June 2021 and July 2022.

Converted into the local currency, the money would be Shs4.2 trillion. This is slightly lower than the amount the country allocated to the ministry of works and transport for operations in the financial year 2022/23.

This amount, according to the country’s central bank, Bank of Uganda, indicates a big recovery when compared to the registered remittances in 2020.

Dr Adam Mugume, Bank of Uganda’s director for research, told local media in September 2022 that remittances to Uganda had declined by 2.8 per cent in 2020. “Remittances totaled around $1.1billion in twelve months to July 2022, almost the same amount as in the same period of 2021,” he said.

Dr Mugume also attributed the recovery to “the reopening of global economies as Covid-19 waned”.

Local economists such as Dr Fred Muhumuza said the dollars were coming in at a time when they were needed most.

“It is good for us as we need to keep reserves stable to avoid rapid depreciation that would amplify inflationary pressures,” Muhumuza told local media.

“We need the dollars, but most importantly, these feed directly into households of the emigrant workers many of which are very fragile and vulnerable and support the local economy at the grassroots,” he added.

Statistics at the central bank indicate that the Middle East, Europe and Americas remain the key sources of remittances. Uganda is among the top 10 recipients of remittances from these regions in sub-Saharan Africa.

Although there are no clear statistics of how much comes for the regions, North America has the highest figure of Ugandan professionals while the Middle East takes a mixture of mainly casual labourers.

The UN estimates about 620,000 Ugandans live and work outside the country – in East Africa, wider Africa, Europe, Asia, Americas and Middle East, among others. Of these, the Saudi Arabian Embassy in Kampala said between 200,000-250,000 Ugandans work in the Middle Eastern country.

I early 2022, in order to ensure that more Ugandans go and seek jobs outside the country, the government resumed issuing of licenses to labour export companies.

This followed the revision of the Employment (Recruitment of Ugandan Migrant Workers) Regulations, 2021.

Government is still in the process of negotiating agreements with Bahrain, Kuwait, Oman, Turkey and Jordan so that Ugandan workers there can have a fair deal and remit more resources back home.

In August 2022, the Saudi Arabian Ambassador to Uganda, Jamal Mohammed Hassan Al-Madani, said his country was willing to review the existing agreement signed between the Kingdom of Saudi Arabia and Uganda on employment. This is meant to ensure that the Ugandan workers in Saudi Arabia are safe and paid well.

“Saudi Arabia and Uganda have friendly relations that have grown and developed over the years, deepened by common interests and mutual benefits and strengthened by mutual visits between the two countries,” the diplomat said.

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