Multinational companies’ exits a big threat to national economy—UPC says
Kampala – 9, September 2021: Africell Uganda is exiting the telecommunication market in the country after seven years. The telecom, in a message to employees, says and announces it will cease operations on October 7, 2021.
“… the decision is being made in the long-term interest of the Uganda telecom sector,” it says.
Seven years ago, Africell bought off Orange. The latter had struggled to lead in the market currently dominated by MTN Uganda, and Airtel Uganda, respectively.
Also, another multinational company, Shoprite supermarket has announced exiting Ugandan market after more than two decades of operations.
“In line with the group’s non-RSA review process, our operations in Uganda and Madagascar have been classified as ‘discontinued’” the South African-based firm announced their exit on 23, August 2021.
Like Africell and Shoprite, Game store is said to be exiting ‘for good’.
Addressing the media in Kampala on Wednesday 8, September, Uganda People’s Congress (UPC) party expressed concerns.
“Multinational companies exiting the country and closing their operations is a big threat to the national economy. When these multinational companies come to the country to set up businesses, they come to only make profits, but as a country we look at a number of factors ranging from providing employment to our people, technological transfer, development, among others and to achieve this governments offer incentives to these companies that will sustain them including but not limited to tax holidays and grants,” Sharon Arach Oyat, the party’s spokesperson says.
“The ideological aspect of UPC is to fight ignorance, poverty and disease. However, these companies have been employing thousands of Ugandans as well as paying taxes to the state. With more than one company logging their resignation in the business sphere, many Ugandans are going to lose jobs and this threatens their livelihoods,” she adds.
“UPC, therefore, urges government to interact with these companies and come up with more suitable ways of carrying on with business without Ugandans losing jobs and widening the already eclectic unemployment gap.”
On a serious note, she says, “UPC urges government to protect the workers, and ensure that these workers receive their benefits as slated in their employment. In most cases, when companies are exiting a country, they tend to exploit workers and cheat them of their pay and benefits.”
At the same press conference, UPC has called upon the ministry of gender, labour and social development to investigate and ensure that all workers are treated fairly amidst the exit of these companies.
Uganda’s economy grew by 3.3% in the fiscal year 2020/21 amid COVID-19 pandemic, available data by the Ministry of Finance and Uganda Bureau of Statistics (UBOS) show.
In terms of Gross Domestic Products (GDP), the UBOS estimates show that the economy grew compared to the revised GDP growth of 3.0 percent in the fiscal year 2019/20.
With multinational companies announcing exits, Uganda’s economic growth could slow down as they (companies) will no longer be taxpayers, including their employees.
And with the adverse upshot brought by the pandemic, it could be worse.