President Yoweri Museveni has called for a stronger and better-capitalized Uganda Development Bank (UDB), positioning it at the heart of Africa’s drive toward financial self-reliance amid a steady decline in development aid and tightening global capital markets.
Speaking at the opening of the first-ever Uganda Development Finance Summit in Kampala recently, the President underscored the urgent need for African countries to build robust national development finance institutions capable of mobilizing long-term capital to drive inclusive and sustainable growth.
The two-day summit, held under the theme “Transforming Africa Through National Development Finance Architecture,” brought together policymakers, financiers, development experts, and private sector leaders from across the continent to rethink Africa’s development model.
The convening comes at a time when traditional aid flows are falling, international borrowing is becoming more costly, and competition for global capital is intensifying a combination of pressures Museveni said demands a shift from dependency to self-sufficiency.
The President argued that Africa’s fragmented markets and over-reliance on private capital have slowed the continent’s economic transformation.
He emphasized that for businesses to thrive, they need access to affordable credit, low-cost electricity, efficient transport, and guaranteed markets conditions that, he said, cannot be met without integrated regional economies and stronger government-backed financial institutions.
“From the beginning, I could see that relying on the private sector to be the one to bring money, to deal with wealth creation, after you have dealt a bit with infrastructure, was not correct, there was a mistake there. Because your own people did not have the savings, and even when they have money, they squander it,” Museveni said.
He explained that foreign investment alone cannot sustainably drive growth, especially when competing with economies like China, which rely heavily on strong domestic financing institutions.
“That is why, from the beginning, I said we need a UDB, we need an Ojangole. We need a government institution which is not looking for profit, to keep giving some capital, not only for infrastructure but also for wealth creation,” he added.
President Museveni called for increased capitalization of UDB, describing it as “a sure guarantee” for financing national priorities, unlike private capital, which he said remains expensive, short-term, and profit-driven.
He cautioned that the high cost of borrowing forces many local entrepreneurs into import-based businesses that yield quick profits but undermine long-term industrialization.
“That’s the only way you can make money quickly. You buy wine, spirits, and perfumes, because these are the only products where you can be able to pay back at high interest rates. Therefore, the answer for all this is UDB. This one is ours. All the others may come, may not come, but they are not under our control,” the President noted.
Recognizing UDB’s growing role in stimulating private enterprise, Museveni urged the bank to further support productive sectors by lowering its lending rates to around 10 percent to make credit more accessible.
He also identified four priority sectors commercial agriculture, manufacturing, services, and ICT as the key drivers of Africa’s economic transformation, arguing that targeted investment in these areas would unlock wealth creation, job opportunities, and regional competitiveness.
The summit drew high-level dignitaries, including First Lady Janet Museveni, Finance Minister Matia Kasaija, and State Minister for Investment Evelyn Anite, alongside global development financiers and private sector leaders. UDB Managing Director Dr. Patricia Ojangole described the summit as a defining moment for Africa, stressing the need for bold reforms in development financing.
Quoting the African Union’s Agenda 2063, Dr. Ojangole noted that the continent aspires to increase its share of global trade from the current 2 percent to 12 percent by 2045, a target she said requires stronger national development finance institutions.
“Realizing these aspirations requires a national development finance architecture that integrates public and private sector efforts, fosters innovation, enhances technical capacity, and prioritizes local leadership and ownership,” she said.
She also added that UDB and other African Development Finance Institutions will play a catalytic role by blending local resources with global partnerships to attract transformative investments.
Despite Africa’s projected 4.3 percent economic growth this year making it the second-fastest-growing region globally the financing gap for achieving sustainable development goals remains significant.
According to the 2024 Africa Sustainable Development Report, the continent needs an estimated $1.3 trillion annually to meet the SDGs by 2030, including up to $108 billion per year for infrastructure alone.
Yet, development aid is shrinking, with the Organisation for Economic Co-operation and Development reporting a 7.1 percent decline in global aid flows in 2024, while Africa itself recorded a 4.1 percent drop in assistance despite rising global allocations.
The summit’s discussions revolved around industrial policy, green growth, technological innovation, and agricultural transformation, with participants agreeing that Africa must create innovative financing models and prioritize local capital mobilization.
Speakers stressed that national development banks like UDB can bridge the gap between limited donor funding and the continent’s growing financing needs, driving job creation, industrialization, and economic resilience.
For President Museveni, strengthening UDB is central to Uganda’s and Africa’s broader quest for economic independence. With declining external aid and rising global competition for capital, he argued, African governments must invest in domestic institutions that can finance long-term development priorities.
“A well-funded UDB is not just a cost it is an investment in our future one that will mobilize wealth, drive transformation, and secure prosperity for our people,” the President said.