The Context

Over the past two decades, Uganda has experienced high economic growth and a significant decline in poverty. The economy of Uganda advanced 5.5 per cent year-on-year in the second quarter of 2017, compared to an upwardly revised 4.6 per cent expansion in the previous period. It is the strongest growth rate since the third quarter of 2015, due to agriculture, forestry and fishing (4.9 per cent compared to 4.4 per cent in Q1); services (7.2 per cent compared to 5.9 per cent) and industry (3 per cent compared to 1.9 per cent).

By 2011, Uganda had already achieved the 2015 Millennium Development Goal of halving the share of the population living on less than one dollar a day. The proportion fell from 53 per cent in 1993 to 24.5 per cent.

While the proportion of people living in poverty significantly declined, the reduction in the number of poor people was much less marked due to the country’s high population growth rate.

Poverty remains mainly a rural phenomenon; 34 per cent of the rural population lives below the national poverty line, compared to 14 per cent of the urban population.

Uganda’s population density has doubled in the past 20 years and is expected to double again over the next 20 years. The country has one of the highest dependency ratios in the world, with a relatively small working age population supporting a high proportion of young and old people, and this is also expected to rise. The unskilled labour force is growing at about 3.7 per cent annually, and most of these workers are being absorbed by the agriculture sector.

The agriculture sector in Uganda accounts for approximately 23 per cent of GDP and employs about 60 per cent of the labour force, a number that is increasing as the population grows.

The Strategy

In Uganda, IFAD is working to increase the incomes of rural households living in poverty, along with improving their food security and reducing their vulnerability.

Activities target two groups: poor smallholder households who have the potential to commercialize their economic activities, and extremely vulnerable households, who have limited livelihood options and are generally bypassed by development initiatives.

IFAD also focuses resources in the areas with the highest incidence of poverty (north) and the greatest density of poor people (east).

The IFAD country strategic opportunities programme has three strategic objectives:

• Support increased production, productivity, value addition, competitiveness and inclusion of smallholders within selected value chains.
• Strengthen environmental sustainability and climate change resilience of poor rural people’s livelihoods and economic activities.
• Enhance sustainable livelihood development for marginalized and poor households, especially women and youth.

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