About the Uganda Youth Fund

In her 2011/ 2012 budget speech, the Hon. Minister of Finance pronounced herself on a package for ‘Job Creation and Employment Strategy’ particularly for the Ugandan Youth. We saw this as a very big opportunity in two ways; i.e. creating sustainable employment for the unemployed youth who are continuously turning into a security threat to our businesses and secondly, promoting cottage industrialization, a segment that has helped countries like India to grow.
However, just three months to the close of the financial year, the program is yet to start. My concern is not only on the delay, but as well the priorities.
Youth Entrepreneurship Venture Capital Fund:
Uganda shillings 25 billion was allocated as a Youth Entrepreneurship Venture Capital Fund to be managed by commercial banks. However, what we have to know is; unemployment is not entirely about lack of working capital but more on lack of market skills. Surprisingly, most of the youth do not even know what to do with the money except engaging in petty trade and boda boda business!
Most of our people already have working capital but because of ignorance, everyone thinks that they require more than what they have. With Uganda shillings five hundred thousand (500,000/=), one can start a project like; making Candles, Liquid Soap, Charcoal Briquettes, Saloon consumables (Shampoo, Conditioner, Relaxer etc), Book Binding etc. these are all highly viable projects.
I am of a view that; these funds should be directed towards enhancing public awareness about existing micro and small scale investment opportunities, the role of cottage industrialization in the practical fight against extreme household poverty and creation of sustainable employment opportunities. After that; the informed groups would then be taken through practical skills training.
Now the Youth Venture Capital Fund would come into play, funding the youth in acquisition of required project machinery/ equipment and to the extent possible procuring raw materials.
Case Study: School Chalk
70% of the School Chalk that we use in Uganda is imported from Kenya and/ or Dubai. Starting a school chalk project requires a capital of Uganda shillings three (3) million. With 1.5m buying the manual school chalk moulder; the balance goes for required raw and packaging materials. In a day one produces 67 packets of school chalk at a cost of 110,000/= which is 1,642/= per packet.  Currently, the wholesale price for school chalk is 2300/=. Meaning that; from one day’s production, one will make a profit of 44,086/= and working for 25 days a month one goes home with 1,102,150/=.
There is no requirement for electricity and the market is open much as one can maintain quality. The cost of this project is equivalent to the cost of a boda boda but the productivity and both direct and indirect benefits to the country are totally different.
Youth Entrepreneurial Training Program:
The youth fund has a segment for training and UgX 3.5 billion was allocated for this. According to the Ministry of Gender, the activity will focus on Entrepreneurship skills training. I am in agreement much as the program focuses on practical skills and mindset re-engineering.
Caution should be taken; for any training, the intended age group will only tolerate short training programs i.e. not more than one week as some of the intended participants have domestic responsibilities to take care of. To cater for all, the programs should be conducted in local languages.
Business Development Skills:
Uganda shillings 1bn was passed for Enterprise Uganda to work in collaboration with the Private Sector and USSIA to impart technical skills to youth using the non – formal vocational training programmes.
This was brilliant but the fund was not only diverted from Enterprise Uganda to Ministry of Gender but also the priority areas were changed.
The Job Stimulus Programme:
A Uganda shillings 16.5bn package for creating dedicated work spaces in markets for the youth and other small scale manufacturers was announced in the budget speech. This is wonderful but again we have to be very careful to avoid the program benefiting and promoting imported merchandise other than promoting locally made products which would stimulate cottage industrialization.
Just like the case with other countries like India, the government should gazette some cottage industrial projects for our low income earners to engage into productive investment. Lastly is the need to have UNBS come in to help the cottage industrialists shape up to meet minimum quality standards before the government works to create a market linkage program for the homemade products.
As development of cottage industries take root, on another front we have to focus on the likes of Kwagalana Group to entice them into manufacturing other than import trade. If these get into manufacturing, then the market base for our cottage industries will be expanding as they produce industrial inputs for the big industrialists and as well we shall be having something to sell into the foreign markets unlike now when the entire well to do traders are only focusing on import trade and building arcades.
Simple solutions.
Maalik Fahd Kayondo
C.E.O/ Lead Consultant – Telesat International
Organizing Secretary – KACITA