Economic dependence

The economy of Uganda is a dependent one. It depends on a few economic activities, failure of which may lead to a depression and success of which, may result into a boom. The dependence nature of Uganda's economy is basically manifested by dependence on:

  • Foreign trade
  • A few export crops
  • Agricultural production activities/output
  • Foreign assistance
  • Imported/foreign manpower
  • A few exports
  • Imported raw materials to be used in some of her industries.
  • Foreign/imported technology
  • Foreign economic decisions, etc.

Normally, dependence in an economy is often identified by several aspects.

Dependence Syndrome. This is the extent to which an economy relies on various economies, in many ways for its sustenance. This would imply that the economy finds it difficult to sustain itself.

Trade Dependence. This is a situation in which an economy of a country is conditioned to the development programmes of another country, to which the former is subjected. LDCs like Uganda tend to depend on developed nations due to lack of economic power and strength to sustain themselves e.g. depend on exports, inputs, etc.

Economic resource dependence. This refers to the reliance on external economies for capital resources, technology and manpower resources. This could be in form of foreign investment, loans, grants, foreign aid, etc.

Direct economic dependence. This occurs when economic decisions of a country are influenced by external forces i.e. foreigners, e.g. through privatization, investment, trade, transport, etc.