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CMA, UMA sign MOU to increase access to financing from the Capital Markets

​UMA members to receive customized training sessions by CMA consultants

Kampala: The Capital Markets Authority (CMA) and the Uganda Manufacturers Association (UMA) have signed a Memorandum of Understanding (MOU) that will enable Uganda’s manufacturing sector to take advantage of customized training on the various options for raising long-term capital to bolster their uptake of non-bank, market-based financing that best fits their needs.

Mr. Keith Kalyegira, the CMA Chief Executive Officer said the MOU will enable the CMA and UMA to consult, exchange information, and cooperate closely to expose UMA members to alternative means of meeting their financing needs, by tapping into both private and public markets.

“Following the signing of this MOU, the CMA looks forward to building the capacity of UMA members to increase access to market-based financing. Non-bank financing can drastically bring down the cost of raising capital which is relatively high and negatively impacts manufacturing. This will hasten Uganda’s socio-economic growth and transformation,” he said.

Mr. Deo Kayemba, the Vice-Chairman, Uganda Manufacturers Association (UMA); said that this partnership will offer industrialists insight into the various financing options available through the Capital Markets.


“The succession of businesses in manufacturing entities in Uganda; both at governance (board) level and shareholding level is largely focused on families with little or no interest to include more members outside their families. This partnership, therefore intends, through collaboration and research, to establish hybrid financing options, as well as identify and influence changes in law that allow for offering financing without requiring significant changes in shareholding structures,” he said.

Mr. Daniel Birungi, the Executive Director, UMA, said that that the collaboration will explore the promotion of market-based financing for manufacturers as a means of reducing the cost of capital that currently negatively impacts manufacturing as a priority sector for Uganda’s socio-economic growth and transformation.

Uganda Manufacturers Association
“Manufacturers in the Scholastic materials, the beverages sector among others who have suffered from a slow-down in business due to the guidelines that were instituted by the World Health Organisation to curb the spread of the novel coronavirus. “Therefore, the MoU with CMA is a move towards better Capital Markets solutions for SME financing; a solution that will also catalyze recovery from the crisis occasioned by the pandemic,” Mr. Daniel added.
Since 1998, industrialists such as Kakira Sugar Limited, Uganda Clays, Cipla Quality Chemicals, British American Tobacco have turned to the capital markets for financing through equity and corporate bonds – which have all been well subscribed.
Kakira sugar issued a 10 year, $30million (about sh76 billion) corporate bond in 2013.


Other firms that have issued corporate bonds include East African Development Bank (EADB), the Trade Development Bank (TDB), MTN, Uganda Telecom Limited, Standard Chartered Bank, Housing Finance Bank Limited, Stanbic Bank Uganda Limited, African Development Bank (AfDB).
Even more firms, such as; Umeme, Vision Group, Uganda Clays, Stanbic, Bank of Baroda, Dfcu, and the National Insurance Corporation (NIC) have listed equity on the Uganda Securities Exchange.


Mr. Dickson Ssembuya, the CMA director for research and market development pointed out that in addition to providing much-needed capital to expand the operations of the manufacturing industry, non-bank financing also offers a clear path for succession, ensuring that manufacturing firms continue in operation even after their founders have left.
“We want Ugandan manufacturers to increase their uptake of non-bank financing such as through acquiring private equity, listing shares on the two licensed securities exchanges and/or by offering corporate bonds privately or publically. Our experts will train UMA’s members on the various ways to raise capital and the steps they need to take to participate in non-bank financing,” Ssembuya said.

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