Ugandan economy has a relatively small formal sector and a large informal sector. The informal sector is well established to provide income-generating activities which formal sector so far is unable to provide. According to the World Bank Doing Business 2014, Uganda is ranked 132nd out of 189 economies. Although it performs comparably well in getting credit turns out favorable, its performance in getting electricity and starting a business lag behind. Concerning the difficulty in starting a business that requires 15 procedures, takes 32 days and costs 78.3 per cent of income per capita,the one-stop facilitation services centre has made it easier by streamlining procedures and introducing modern technological and communication tools. For example, investors can register their business with the Uganda Registration Services Bureau; deal with tax and other registration issues with the Uganda Revenue Authority (URA); and organize work permits and residency issues with the Directorate of Citizenship and Immigration Control. The Investment Code also allows foreign involvement in almost all sectors, with limitations for cases that require land ownership or that touch on issues of national security. However, a range of conditions in the form of performance obligations can make gaining business licenses difficult for foreign investors. Other hurdles for efficient business and free-market competition are the high level of corruption and the penetration of the business environment by networks of nepotism and patronage with occasional ad-hoc interventions by powerful politicians.
|The Business Environment: Doing Business