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Don’t Panic Over Increase In Commodity Prices – Gov’t

Government has urged Ugandans to stay calm, not to panic as commodity prices rise saying that the situation is only temporary.

Speaking at the government media center in Kampala, the Minister for ICT and National Guidance Dr. Chris Baryomunsi said the causes for the increase in commodity prices are largely external and can hence be tackled Internationally.

Baryomunsi says that Ugandans’ situation isn’t isolated because globally economies are still recovering from the effects of COVID 19 disease. He says that when countries instituted strict measures to control the spread of COVID 19, the production of different items went down. He explains that production in different factories reduced yet demand has remained the same hence affecting the price of commodities.

The Minister further explained that the war on Ukraine has had an impact on some key home use products like Cooking Oil. Ukraine, a country that was invaded by Russia nearly a month ago now, is one of the largest producers of sunflower some of which is used by factories in Uganda to produce edible oils.

Baryomunsi has hence asked Ugandans to be calculative in their expenditure and suspend consumption of some commodities which they can do without.

Commodity prices started increasing late last year with fuel prices increasing by over 400 shillings in some parts of the country. Prices of other consumer commodities also started increasing with items like cooking oil and soap increasing in by over 1,000 shillings.

Asked what measures the government is planning to put in place to remedy the situation, the Minister said that the Bank of Uganda is working out measures to stabilize the economy and to ensure that prices don’t increase to unbearable levels.

Baryomunsi added that government also plans to continue sensitization of people to grow food for subsistence use and sell the excess.

He however emphasized that the increase in prices is being informed by external factors and government can only do much. He dismissed claims by some traders that taxes are partly to blame for the prices.

Dr. Fred Muhumuza, a development economist from Makerere University also says that government can only do so much about the soaring prices since the main factors responsible for the rise are external. Dr. Muhumuza explains that government cannot reduce tax or offer subsidies to producers because it lacks money to do that.

“We have always asked manufacturers to produce raw materials locally and use those, now they are affected as Ukraine from where they import sunflower is at war,” said Muhumuza who wants Ugandans to develop local capacity to develop and use local raw materials. “It’s not only consumers affected, even them because people cannot buy as much as they used to.”

Dr. Muhumuza also said that the dollar and the shillings have remained largely stable, which is something good that government has been able to do, otherwise, the prices would have gone even higher.

“There isn’t much more that they can add that will not hurt the economy even more” added Dr. Muhumuza.

Dr. Muhumuza also echoed the minister’s call that Ugandans should only buy what they must as they wait for the situation to normalize.

Meanwhile, at the same event, Minister Chris Baryomunsi also said that cabinet resolved to construct industrial parks in every geographical area in Uganda so as to create jobs for graduates and young people in different parts of the country.

Baryomunsi says that government has in the past put emphasis on infrastructure development like construction of roads to ease transportation of goods and services.

The local government in different sub regions shall be required to identify and allocate land for the industrial park measuring at least 500 acres.

Baryomunsi says government shall extend utility services like roads, electricity, water, and internet to the parks as the look for investors to establish factories depending on what locals in those areas produce.

-URN

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