UGANDA’S STUBBORN DEVELOPMENT PARADOX

In 2013, a piece titled “Ugandans are rich but cash poor”, was published in this column.

It was based on the National Household Survey of the time and a reflection shaped by countless conversations and everyday encounters. It was hard to ignore.

From Kampala to Kabale, people owned land, cows, rentals—even the odd plot in the trading centre,but when a child needed school fees or a medical emergency struck, the scramble for actual cash began. There was wealth, but it was locked away, often in forms you couldn’t easily convert when life demanded liquidity. A country asset-rich, but perpetually broke.

Fast forward a decade, and the story seems—on the surface to have improved.

The recently released Uganda National Household Survey 2023/24 paints a picture of real progress. National poverty has dropped to 16 percent, down from 21.4 percent in 2016/17 and significantly lower than the 24.5 percent that hovered around in the early 2010s. That’s something to celebrate. Even the Gini coefficient, our favourite number for inequality, has eased down from 0.415 to 0.382—a sign that we’re a bit more equal than we used to be, at least in terms of income.

But if you zoom in, if you walk the dusty paths and speak to the people, you realise something sobering: that same old paradox still holds. Just better disguised.

Let’s start with wages. Back in 2013, a median salary in Kampala was around sh200,000—enough to cover rent in a low-end suburb and maybe transport and food for a small family. Ten years later, that number has risen slightly to sh260,000 for urban workers in paid employment. That’s not insignificant. But when you account for inflation, school fees, rising fuel prices, and the cost of milk, the money disappears just as quickly as it lands. Rural areas fare worse. Median wages there remain closer to sh120,000–150,000. In essence, the nominal wage has risen, but its real purchasing power has not kept pace.

And what of financial inclusion, that shiny term we love to throw around at conferences? In 2013, mobile money had just begun its ascent. People were excited—sending and receiving cash was suddenly fast and borderless. But real financial empowerment remained limited. Few had bank accounts. Fewer still could access credit. Fast forward to 2023, and mobile money is now the norm. Formal account ownership has grown too. But here’s the catch: 77 percent of household enterprises still rely on personal savings as startup capital. Access to affordable credit, the kind that turns ideas into income, is still out of reach for most...

Back then, I wrote about how people would own three cows and five acres of land but still fail to raise school fees. That story hasn’t changed. Formalization of wealth is still rare. Land is often unregistered. Titles, too few to go around – less than two million at last count, which is a travesty when seen against the fact that more than 80 percent of Ugandan families own their homes. So the wealth sits there—visible, impressive even—but untapped. Ten years on, the form of wealth is the same, but its utility remains frustratingly limited.

There have been other changes. Food, once consuming over 50 percent of most poor households’ budgets, now accounts for 44.2 percent. That’s progress, modest as it is. Expenditure on housing, electricity and water stands at 15.9 percent—steady, though hardly relieving. These improvements have come, in part, from better infrastructure and cheaper services, but they still leave the average Ugandan living on a knife’s edge. The room for saving, investing, or even affording a modest treat is wafer thin.

Even in education, the signs are mixed. Primary gross enrolment has ticked up from 117 percent in 2016/17 to 120 percent today—still bloated by over-aged learners. Secondary enrolment is better, rising slightly from 30 to 34 percent, but we’re still nowhere near where we need to be. Literacy among adults aged 15 and above has improved from around 70 percent a decade ago to 87 percent, which is one of the few unequivocal wins in this story. Yet, cost is still the second most cited reason why children don’t go to school. Some things never change.

Perhaps most telling is the persistence of regional disparity. In 2013, I hinted at it. Today, the data confirms it. Karamoja’s poverty rate stands at a staggering 74.2 percent. Ankole, on the other hand, is at 3.2 percent. Kampala sits at 1.1 percent. These aren’t just numbers—they’re entire realities apart. When the same country yields both those figures, it begs the question: are we really talking about the same Uganda?

Inequality may be statistically narrowing, but that’s income. Not opportunity. Upcountry, the roads are worse, the schools poorer, the hospitals fewer. And when a child is born into that setup, no Gini coefficient can capture how far behind they’ve started. As I noted in 2013, inequality in Uganda is a structural problem—it’s not just who earns more, but who can do more, access more, live more.

So yes, Uganda is better off today than it was a decade ago. Fewer people are living in extreme poverty. Incomes have inched upward. Financial tools have spread across the map. But the core problem of cash poverty—the inability to access and use money when needed remains deeply embedded. We are richer, statistically. But not necessarily freer.

Uganda is moving. But many are still limping.