Basing on Daniel Birungi, the Executive Director of Uganda Manufacturers Association, Uganda requires an export guarantee plan while trading with the Democratic Republic of Congo and South Sudan.
Mr. Birungi noted during the Absa Bank Uganda sponsored post-budget virtual conference that was recently held in the central city of Kampala.
However, this is not the first time such remarks are being made as previously, the same appeal was made by trade experts since the countries in question battle with political turmoil that has cost Ugandan traders trillions of shillings.
Due to this, Birungi believes having an export guarantee scheme is wise so that even if a trader is not able recover lost good, they have a plan B to look back on and survive the business tragedy.
“We have opened up South Sudan and DRC, which is very good work. But the aspect of volatility in these markets requires that we have an export guarantee scheme… so that, when a manufacturer transports their goods to these countries and loses them, they are able to have recourse,” he said.
The essence of an export guarantee is to safeguard and insure that exports by a government or semi-government agency or an exporter receive payment for goods shipped abroad in a circumstance that the customer defaults.
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Birungi went on to warn that what is happening in the neighboring countries of South Sudan and DRC is really horrible and most business people ran back to government for help which is not meant to be the right criteria.
Back in 2018, Uganda’s exports to DR Congo were approximately $532 million and in relation to out informal exports, this amounted to $312million while exports from Uganda to South Sudan were at $357.34 million in 2020.