KAMPALA, UGANDA – Uganda’s Iron and Steel sector convened for a critical quarterly engagement today, issuing a unified call for urgent government policy intervention to address several challenges threatening the industry’s competitiveness and sustainability. The discussions, which brought together all major steel manufacturers, centered on the lack of consultation on a new regional steel factory, the need for protective import duties, and the misuse of tax incentive schemes.

The meeting highlighted a sector at a crossroads, ready to expand its capacity but facing significant headwinds from both regional projects and unfair import practices. A key resolution from the engagement was a strategic shift towards collective advocacy, with industry leaders agreeing to unite to champion the interests of the entire sector rather than focusing on individual company concerns.

Key issues raised and the sector’s demands include:

1. Lack of Consultation on Planned Regional Steel Factory

Stakeholders expressed deep disappointment over the lack of consultation regarding a joint plan by the Kenyan and Ugandan governments to establish what is slated to be the largest steel factory in the region. While acknowledging the potential benefits of such a large-scale project, industry players raised concerns that without involving the existing private sector, the new entity could create unfair, state-backed competition, potentially undermining decades of private investment in the local industry. The sector is calling for immediate and meaningful engagement with local players.

2. Urgent Call for Protective Import Duties

There was a strong and unified call for the government to introduce import duties on key intermediate steel products, namely billets, Hot Rolled Coils (HRC), and Hot Rolled Strips. Manufacturers argue that the influx of these products as cheaper imports creates intense price pressure, making it difficult for local producers to compete. Implementing protective tariffs on these items is seen as a critical step to support local value addition, encourage investment in domestic production capacity, and level the playing field.

3. Concerns Over Misuse of Duty Remission Scheme

The sector raised a red flag over what it described as a significant misuse of the Duty Remission Scheme. It was reported that finished steel products, specifically those classified under HS code 7306.90 (which includes pipes and tubes), are being imported through the scheme.

Manufacturers stressed that the Duty Remission Scheme is intended exclusively for importing raw materials at a lower duty to facilitate local production. Using this scheme to import finished goods is a direct contravention of its purpose, creating a loophole that undercuts local manufacturers of the same products and negates the very incentive designed to support them. The sector is demanding immediate action from the Uganda Revenue Authority (URA) to close this loophole.

The outcomes of this meeting represent a clear and united message from one of Uganda’s foundational industrial sectors. The call for fair competition, consultation on major projects, and the proper implementation of existing policies is a crucial test of the government’s commitment to the “Buy Uganda, Build Uganda” agenda and the broader goal of sustainable industrialization.