7.500
%
Negative
88
mm boe
0
%
Recent geopolitical turmoil has acted to destabilise the outward perception of the new regime, which follows quickly on from the issues faced by Tullow on its sale of its Ugandan assets to Total. With the deterioration of the government likely to continue, we have Uganda on a Negative outlook.
April 13, 2024
Africa - East
mm bbl
bcf
East-Central Africa, west of Kenya, east of the Democratic Republic of the Congo.
PSC/PSA
Production Sharing Contract ("PSC")-based fiscal regime. Royalty rates and profit oil splits between contractor and government are both based on sliding scale linked to production rates. Cost recovery ceilings are negotiable. The contractor is also liable for income tax. Signature bonuses are negotiable, and some minor rentals are payable. There is no additional profits tax.
Uganda’s investment climate presents both opportunity and challenge in equal measure. Uganda maintains a liberal trade and foreign exchange regime. FDI surged by a 80% in FY 2018/2019, driven by construction and manufacturing sub-sectors. President Yoweri Museveni and government officials welcome FDI in Uganda, which is offset by the government’s actions. Closing political space, poor economic management, endemic corruption, growing sovereign debt, weak rule of law, and the government’s failure to invest adequately in the health and education sectors all create risks for investors. An uncertain mid-to-long-range political environment also increases risk to foreign businesses and investors. Domestic political tensions have increased in the run-up to the 2021 elections as 34-year incumbent President Museveni faces new challengers and a disenfranchised youth demographic that comprises 77% of the population.
Source: ESRI, Heritage Index, HMG Foreign & Commonwealth Office, US Department of State, International Trade Administration, International Law Review, Ernst & Young, Wood Makenzie & OGA data.
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