Home Business Rwanda-Uganda Border Reopening Spurs 42% Growth in Katuna’s Revenue

Rwanda-Uganda Border Reopening Spurs 42% Growth in Katuna’s Revenue

rwanda uganda border reopening spurs 42 growth in katunas revenue
rwanda uganda border reopening spurs 42 growth in katunas revenue

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Revenue collection at the Katuna border has experienced a substantial growth of 42%, signifying a positive trend in business activities since the resumption of operations. This boost comes after a prolonged period of stagnation lasting approximately four years, initiated by the closure of the border between Rwanda and Uganda on February 27, 2019.

During this closure, Rwandan President Paul Kagame accused Uganda of espionage, abducting Rwandan citizens, and harboring dissidents. The resulting strained relations prompted Rwanda to advise its citizens against traveling to Uganda due to safety concerns. This impasse persisted for nearly three years until the intervention of Gen. Muhoozi Kainerugaba, facilitating the reopening of the Rwanda-Uganda Border on January 31, 2022.

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Following the border’s reopening, businesses that had previously collapsed at Katuna started to resume operations. However, Rwandan nationals crossing into Uganda were required to pay Ugx 5000 for a Covid PCR Test, presenting a challenge to many. Additionally, small-scale Rwandan businessmen initially faced restrictions on purchasing food items and essentials from Ugandan markets. The situation gradually evolved, and by June of the same year, Rwandan nationals were permitted to freely cross into Uganda for trading purposes.

A recent visit by our reporter to Katuna Border revealed a noticeable increase in the movement of Rwandan nationals freely shopping in Ugandan markets. This surge in cross-border activity has positively impacted revenue on the Ugandan side.

In a phone interview, Edrine M. Mutebi, the acting assistant commissioner in charge of public and corporate affairs at Uganda Revenue Authority, provided insights into the financial implications of the border closure and subsequent reopening. Mutebi noted that revenue collection, which was above Shs 1 billion at the time of the border closure, witnessed a significant increase to over Shs 2.7 billion upon reopening in 2022. Last year, the figures climbed to Shs 3.8 billion, reflecting a substantial 42% increment. Mutebi emphasized the strategic importance of the border post and highlighted the positive impact of close cooperation between the two countries on trade.

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Christmas Dezi Byarugaba, the town clerk for Katuna town council, shared insights into the local perspective, stating that tax collections were minimal during the border closure. Since the resumption of trade activities, especially with Rwandan nationals freely engaging in Ugandan markets, local revenue has witnessed a noteworthy increase. Byarugaba expressed optimism, anticipating that by the year’s end, they would collect more than in previous years. The increased purchase of commodities like Posho from Ugandan markets by Rwandan nationals was cited as a significant achievement.

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Ugandan traders Ainemani Bosco and Karagwa Julius affirmed that trade has substantially improved since the allowance of Rwandan nationals into Ugandan markets. The traders are hopeful that, should the current situation persist, business will continue to thrive.