In the late 1980s, donor-supplied canned chicken curry and fish helped feed pupils in schools across Uganda, then emerging from years of conflict. Agricultural production had been disrupted and the country needed assistance to recover.
Around
1990, the supplies were withdrawn. I remember the announcement almost provoking
a riot at my school in western Uganda. We had become so accustomed to Groot and
mackerel that we could hardly imagine school meals without them.
Younger
Ugandans may wonder what I am talking about. But the lesson endures: emergency
assistance can quietly become an entitlement.
Fast-forward
to today's shilling, which has breached the psychological
Shs4,000-to-the-dollar barrier. Some commentators point to diminishing dollar
inflows following USAID's closure and restrictions on NGOs. Their prescription?
Re-ingratiate ourselves with donors so the dollars return.
Here is an unpopular opinion: painful as declining aid will be in the short term, it could ultimately do Uganda considerable good...
Certainly,
aid has saved lives, supported education and sustained essential services. Its
sudden withdrawal threatens real suffering. But perhaps we should ask not how
to restore our dependence, but how to outgrow it.
While
presented as benevolence, aid is also an instrument of influence. Donor
governments pursue humanitarian objectives, but also political, economic and
security interests.
Following
the 2023 Anti-Homosexuality Act, the World Bank suspended new financing
approvals, citing concerns about discrimination, before resuming in 2025 after
safeguards were agreed. The United States withdrew Uganda's preferential trade
access under AGOA. Whatever one's position on the legislation or donors'
concerns, the economic leverage was unmistakable.
Earlier
structural-adjustment programmes linked financing to privatisation and
liberalisation. Foreign assistance has supported domestic policy advocacy,
including initiatives surrounding the Domestic Violence Act, although this was
not necessarily formal aid conditionality. Security cooperation also influences
donor relations. He who pays the piper can influence the tune.
"One understands the grumbling about aid cuts, especially from sections of the urban elite who have benefited handsomely from the aid economy. Donor-funded organisations, consultancies, workshops and professional jobs have sustained a comfortable urban class.
Kampala's sprawling suburbs and imposing upcountry mansions, many occupied mainly during festivities, are proof enough...
We
need to look beyond the comfort of a relatively small, entitled elite towards
spreading the benefits of economic recovery to the majority. At last count, 64
percent of Ugandan households engage in agriculture. Raising their productivity
and incomes must be central to development.
But
critics say Uganda lacks the resources. Really?
Electronic-money
transactions reached Shs366 trillion in 2025, up from Shs286 trillion in 2024,
exceeding Uganda's annual economic output of approximately Shs250 trillion.
Growth that seems to be far from plateauing. Turnover is not investable
capital; the same shilling circulates repeatedly. Still, it reveals the scale
of domestic financial activity and signals the possibilities.
The
challenge is aggregating more of that activity into savings and productive
investment. NSSF has almost Shs33 trillion in assets. SACCOs, pension funds,
unit trusts and insurers can mobilise fragmented savings into substantial
capital pools, provided projects are commercially viable and savers protected.
"We cannot tax ourselves into prosperity. We must produce ourselves into prosperity...
Coffee
shows what a sustained production strategy can accomplish. From approximately
4.2 million 60-kilogram bags in 2015/16, output more than doubled to eight
million by 2020/21. Recent annual exports have likewise exceeded eight million
bags, earning billions of dollars.
At
that level Uganda is approaching genuine industrial scale. Consider Nestlé,
which says it buys over 13 million 60-kilogram bags, from more than 20
countries. Our annual crop is already equivalent to roughly three-fifths of
that global giant's purchases.
With
a clear understanding of the value chain—from cultivation, grading and trading
to roasting, soluble coffee, packaging, branding and retail—we can deliberately
build Ugandan enterprises that capture more value from every cup.
Rather than remain primarily a supplier of anonymous beans, why not develop roasting and processing capacity where commercially competitive, nurture Ugandan brands and negotiate better access to global consumers? We cannot dictate world coffee prices, but we can take greater control of our coffee's destiny...
Dairy
offers another example. Uganda's milk production doubled from 2.7 billion
litres in 2020 to 5.4 billion in 2024, while dairy exports rose substantially.
Why
not replicate such efforts in commercial goat production through better
breeding, animal health and market access? Fish farming and processing can
expand earnings while protecting our lakes. Intellectual property—software,
music, film, publishing and technology—can earn foreign exchange without
shipping containers overseas.
All
this demands better roads, electricity, storage, affordable finance, extension
services and predictable taxes. Rather than seeking another $100 million in
donor assistance, what would it take to generate another $100 million in annual
exports?
Yet
the greatest obstacle may not be economic. It may be political.
A
vibrant private sector creates alternative centres of wealth and influence.
Successful entrepreneurs, financial institutions and business associations will
demand accountability and sometimes disagree with government. For political
elites suspicious of independent power centres, that requires a leap of faith.
"Real prosperity will require the intellectual flexibility to let economic influence flourish beyond political control...
Declining
aid guarantees none of these reforms. Government could simply borrow more,
raise taxes or slash services.
But
the opportunity is to shift our national conversation from donor money towards
domestic capital, higher production and exports. I remember the uproar over our
disappearing canned fish. We survived without that menu.
Real
independence is not merely having our flag and anthem. It is having the
capacity to pay our bills, finance production and determine our economic
future. Perhaps the greatest favour our development partners can do us is help
us reach the point where we no longer need their generosity.
