The Government of Uganda has reaffirmed its commitment to strengthening Micro, Small and Medium Enterprises (MSMEs) as a key driver of economic transformation, urging entrepreneurs to formalize their businesses in order to unlock growth opportunities and improve competitiveness.
The call was made by the Minister of Trade, Industry and Cooperatives, Sanjay Tanna, during the opening of the UG Catalyst Summit and the commemoration of United Nations MSMEs Day held at MoTIV Hub in Bugolobi, Kampala.
The summit, held under the global theme “Reducing barriers for MSMEs to enter the formal economy: Formalize to rise,” brought together policymakers, private sector actors, development partners, academia, and entrepreneurs to discuss challenges facing small businesses and explore practical solutions.
In his address, Tanna emphasized the central role MSMEs play in Uganda’s economy, noting that they account for about 99 percent of all businesses, contribute roughly 75 percent of Gross Domestic Product (GDP), and employ more than three million people.
“MSMEs are the backbone of our economy. Their growth and sustainability are vital for job creation, domestic revenue generation, and inclusive economic development,” he said.
He acknowledged persistent challenges in the sector, including limited access to affordable financing, restricted market access, low uptake of digital technologies, climate-related disruptions, and difficulties in meeting international quality standards.
Despite these challenges, he praised Ugandan entrepreneurs for their resilience and innovation, pledging continued government support to help enterprises transition from informal setups into competitive, export-oriented businesses.
Tanna outlined several government interventions aimed at promoting formalization and growth, including the Taxpayer Register Expansion Programme (TREP), the Electronic Fiscal Receipting and Invoicing System (EFRIS), and One-Stop Business Centres established by the Uganda Registration Services Bureau (URSB), which have simplified registration and compliance processes.
Other initiatives include instant Tax Identification Number (TIN) issuance, online trade licensing, and funding programmes such as the Parish Development Model (PDM) and Emyooga, which support grassroots wealth creation through savings and credit cooperatives.
He also highlighted the Small Business Fund, which has disbursed over Shs 200 billion to support enterprises affected by the COVID-19 pandemic, with a focus on women- and youth-led businesses.
On innovation, Uganda’s startup ecosystem is showing significant growth, with Kampala-based startups attracting about $30 million in investment in 2025, up from $4 million in 2024.
The government has also introduced tax incentives, including a three-year income tax holiday for qualifying startups under the revised Income Tax Act 2025.
Tanna said the Ministry is finalizing key policy frameworks, including the Startup Development Policy and the Business Development Standards Policy, aimed at improving the regulatory environment for emerging enterprises.
The UG Catalyst Summit is also intended to align enterprise development with Uganda’s Fourth National Development Plan (NDP IV) and the Tenfold Growth Strategy, focusing on sectors such as agro-industrialization, tourism, mineral development, and science, technology, and innovation.
“These efforts are designed to strengthen coordination among institutions, promote technology transfer, and support value addition across key sectors of the economy,” he said.
He reaffirmed government commitment to expanding infrastructure, industrial parks, free zones, and incubation centres to support MSME growth.
“As government, we remain committed to boosting productivity, expanding market access, and creating jobs. MSMEs will continue to play a central role in driving Uganda towards a modern and prosperous economy,” he said.
The two-day summit is expected to generate actionable insights and partnerships aimed at accelerating MSME growth and formalization across the country.
