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Only 0.4% of small businesses have capacity to operate digitally
Just under 5,000 SMEs in Uganda have built capacity to remotely work or monitor their operations over the internet. Photo / File
What you need to know:
- Adaptation of information and communication technology is still low among small enterprises, which puts such businesses at a disadvantage
The International Growth Centre has indicated that only 0.4 percent of micro, small and medium enterprises have capacity to monitor their businesses over the internet.
Speaking at the seventh Economic Growth Forum, Mr Jonathan Leape, the International Growth Centre executive director, said information and communication technology adoption is still low in Uganda among small enterprises, which puts such businesses at a disadvantage in terms of managing cost and remote working and monitoring.
“According to a study by Uganda Communications Commission, for example, only 0.4 percent of micro, small and medium enterprises reported ownership and usage of advanced technology capable of being monitored or remotely controlled via the internet,” he said, urging government to support small businesses to increase the level of technological adoption, which is a driver of productivity and job creation.
Uganda, according to UNCTAD, has at least 1.1 million micro, small and medium enterprises, which account for 80 percent of the country’s gross domestic product.
The 0.4 percent, therefore, translates into about 4,400 enterprises, which are able to able to operate digitally.
Global trends indicate that a number of businesses are beginning to appreciate technology due to a shift in business operations that have predominantly become digital.
The shift has been heightened by the impact of Covid-19, which forced a number of businesses to adopt online operations.
Mr Leape also said there is need for government to build a knowledge-based economy, and the services sector more generally, which is central to the economic strategy of driving productivity, growth and job creation.
World Bank data indicates that services such as business, financial, tourism, and others have the potential to generate jobs as productive as manufacturing, noting that already nearly 30 percent of Uganda’s exports are from services.
Finance Ministry permanent secretary Ramathan Ggoobi, said government is not “focused on not only achieving top line growth, but growth that is inclusive and green, noting that whereas there is need to respond to people’s demands to make the economy not only larger and healthier, but also more inclusive, sustainable and fairer.”
