Uganda seeks pension funds for economic growth
Minister Simon Mulongo wants pension savings to become patient capital for productive investment.
Uganda's government aims to transform its economy from $50 billion to $500 billion by 2040, a goal requiring increased pension coverage and long-term savings to fund growth. Simon Mulongo, minister of state for Labour, Employment and Industrial Relations, stated at a Kampala conference that a strong savings culture is needed to provide patient capital for economic activities. He highlighted that a $500 billion economy cannot be financed with short-term money and low national savings.
Mulongo explained that long-term domestic savings are critical for financing enterprises, creating jobs, and boosting exports. The government targets increasing national savings from 20% of GDP to 40% by 2040, with the pensions sector converting long-term savings into productive investment. He cautioned that pension funds must be invested commercially, transparently, and deliver appropriate returns for beneficiaries, not just for national development.
The minister called for improved governance in the pensions sector, including competent trustees, transparency from fund managers, effective regulation, and timely contribution remittances. He also stressed the need for greater financial literacy among workers to build public confidence. Stanbic Uganda was commended for convening the inaugural SBG Securities Pensions Conference.
Why it mattersUganda's economic transformation plan requires significant domestic capital mobilisation, with pension funds expected to convert long-term savings into productive investments.