The out-going European Union (EU) Ambassador to Uganda, Kristian Schmidt has advised the government to establish a state-owned agricultural bank that would lend out to farmers at cheap interest rates.
Ambassador Schmidt made the call late at State House, Entebbe as the EU representatives in Uganda met President Yoweri Museveni.
Ambassador Schmidt’s call comes at the time farmers are complaining about the high interest rates offered by commercial banks even as government has injected money in the Uganda Development Bank (UDB) for established farmers to borrow at a lower interest rate.
During the Entebbe meeting, the EU representatives and the President discussed a wide range of issues including the national budget, jobs, investments, trade and business opportunities.
President Museveni on his part noted that there was a need to lower the cost of production for private sector led growth to yield positive results. He also said that the lowering the of cost of production is crucial in attracting foreign investments into Uganda.
“The Government’s strategy is to have a private sector -led economy. You must talk about the low costs of production. In order for the private sector to grow, we need to have roads, a railway network, electricity supply and look for cheap money through the Uganda Development Bank,” he said.
Mr. Museveni further said that government has enhanced health care by ensuring effective immunization and hygiene on top of promoting prevention of diseases rather than treatment.
On the oil resource, President Museveni said funds from the sector would be dedicated to further development of infrastructural developments including electricity generation.
Recently, in the budget, the Minister of Finance Matia Kasaija said that the roads construction component was a big contribution towards enabling the farmers to access the market for their produce, and also crucial to the development of agriculture in the country.