Economy News

Last month, the minister of Finance, Matia Kasaija, presented a Shs 72.1 trillion budget for the financial year 2024/25. According to the budget, the government is projected to generate Shs 32.3 trillion through revenue collection to fund its activities.

Additionally, the government expects to borrow Shs 1.3 trillion from external sources and Shs 8.9 trillion from internal sources. Domestic debt refinancing is anticipated to amount to Shs 19.8 trillion, with Shs 9.5 trillion allocated for project support through grants and loans

The budget estimates indicate that the first allocations will go towards external debt repayments, totalling Shs 3.149 trillion. Project support through loans and grants is allocated Shs 9.583 trillion. Domestic refinancing is set at Shs 12 trillion, while interest payments are a substantial Shs 9 trillion.

Other allocations include Shs 603 billion for the recapitalization of the Bank of Uganda (BoU), Shs 200 billion for domestic arrears, and Shs 9.1 trillion for domestic debt payments to the BoU. Of the total resource envelope, Shs 806.3 billion has been allocated to bail out local companies.

The local firms receiving support include Dei Biopharma Ltd., Roko Construction Company, Jena Herbals, Jennifer Serwanga Sempala, and the anti-tick vaccine project at Makerere University.

ROKO CONSTRUCTION COMPANY

Ramathan Ggoobi, Uganda’s secretary to the Treasury, highlighted that in the current financial year, the government has allocated Shs 56.2 billion as payment for the shares it acquired in Roko Construction Company. In July 2022, parliament approved the government’s decision to purchase 150,000 preference shares worth Shs 207.13 billion in Roko Construction Company Ltd.

At that time, Roko had projects with signed contracts worth Shs 1.064 trillion, of which Shs 696.6 billion was for government projects, including the Parliamentary Building. The company’s indebtedness as of May 31, 2022, stood at Shs 202.4 billion.

In August last year, Uganda Tourism Board (UTB) resumed a nationwide grading and classification exercise of all accommodation facilities across the country which include hotels, lodges, guest houses, tented camps, serviced apartments, motels, cottages, eco-lodges, villas among others.

This first phase that begun on August 1 to September 4, 2023, was conducted around Kampala, Entebbe, Jinja, Masaka, Mbarara, Fort- portal and Mbale  Such an exercise had last been carried out in Uganda in 2018 even though according to East African protocols, it is supposed to be done every two years.

Ajarova noted that the delay was because of the Covid-19 pandemic which tremendously affected the tourism and hospitality sector and the need to first sensitize the hotel owners about the importance of being graded and classified since it is still a voluntary exercise for them to take part in.

The exercise is not only in fulfillment of one of UTB’s mandates to carry out quality assurance of the tourism sector as enshrined in the Tourism Act 2008, section (J) which mandates the Board to enforce and monitor standards and section (K) which mandates it to register, inspect, license and classify tourism enterprises but also aligns with the provisions of article 115(2) of the East African Treaty.

In the treaty, Tourism is one of the identified sectors where partner states work together in a coordinated manner, to develop the quality of accommodation and catering facilities for visitors within the region.

“The classification and grading exercise is a very vital component of marketing our tourism destination as well as standards enforcement. Once successfully done, it will create a positive impact because of the improved quality of tourism products and services offered to travelers. This will inevitably improve the destinations competitiveness; it will serve as a useful platform to inform investment decision and enhance self-regulation of the tourism sector for sustainable development,” she said.

According to the law, it is a requirement for an accommodation facility to be licensed by UTB for it to operate legally but it is still voluntary for the facility to be classified and graded.

However, Ajarova says that as the industry improves and develops, it will become a necessity and the law might amend to make it mandatory for everyone because it is one way UTB can market these accommodation facilities especially when bidding for business tourism in terms of Meetings, Incentives, Conferences and Events (MICE).

Meanwhile Susan Muhwezi, the chairperson of Uganda Hotel Owners Association (UHOA) says UHOA and private sector are fully in support of the  exercise and urged hoteliers to participate for the good of the industry as it is a vital component of marketing Uganda as a competitive tourism destination that observes good standards for visitor enjoyment.

“The grading will add value to our investments through increased marketing of the facilities within the accredited grades, align the industry to international standards, manage guest expectation and support the pricing systems of hotels. It will therefore create a positive impact because of the improved quality of tourism products and services offered to tourists,” she said.

In March UTB CEO Lily Ajarova presented plaques to the classified hotels in a ceremony held at Golden Tulip hotel, and these become legitimate bragging rights the facility can display to let customers know exactly what to expect when they check-in.

At the ceremony, Ajarova said the exercise not only enhances the overall tourism experience in destination Uganda, but also allows customers to make informed choices when booking accommodation.

According to UTB, only three facilities qualified for five-star rating, these being Serena hotel’s Kampala and Kigo branches, with the latter coming with a revered golf course and lakeside location.

Sheraton hotel was the only other hotel to get a five-star rating. While presenting the results in March this year, Ajarova revealed that following the first phase, over 300 more hotels had applied to be graded and classified after gaining confidence in the process.

It is because of these applications that the Board undertaking the second phase of the grading and classification exercise starting with trainings of hotel owners and managers in different regions of the country to raise awareness on the importance of grading and classification and encourage them to get their facilities registered, inspected, licensed and graded to meet regional standards.

The grading and classification is going to run until July 31, covering several districts and cities including Kampala, Masaka, Hoima, Gulu, Fort Portal, Entebbe, Wakiso, Kayunga, Mukono, Kalangala, Kabale, Kisoro, Kaabong, Kiruhura, Kabarole, Kamwenge, Kibale, Kanungu and Rubirizi.

The grading and classification exercise considers 375 components as stipulated by international standards. These include location, size of the rooms, restaurants, interior décor, guest rooms, bathrooms, suites, hygiene, safety, security, human resource, culinary services among others leading to the facility to be given either a one star, two star, three stars, four star or five-star status.

Unlike the previous times, this time round the exercise has been digitalized; field assessment teams have received ICT equipment that are preloaded with automated E-classification System making it efficient and effective to carry out their work seamlessly and eliminating chances of corruption.

Understanding how hotel ratings are done globally:

1-Star Hotel Benefits

• Cost-effective
• Comfortable room and bed
• Provide for basic needs

2-Star Hotel Benefits

• Affordable
• Comfortable lodgings
• Comes with brand recognition
• Dining options
• Loyalty programs

3-Star Hotel Benefits

• Quality service for mid-range pricing
• Stylish and comfortable rooms
• Easy to get to tourist attractions
• Exercise options, such as a pool and gym
• The difference between a 2-star hotel and 3-star hotel is the amenities provided.

While a 2-star hotel will focus on the basics for a one-night stay, 3-star hotels focus primarily on business travels and multi-night stays.

4-Star Hotel Benefits

• A full upscale experience
• Staff to provide for needs
• Location for rest and relaxation
• Entertainment and food options right on sight making the need to leave the premises minimal
• The difference between a 3-star hotel and 4-star hotel is the availability of activities and level of care from the staff.

While 3-star hotels offer some fitness selections like a pool and gym, a 4-star hotel provides options such as multiple pools, spas, and fitness classes. Three-star hotels are about comfort, while four-star hotels are about relaxation.

5-Star Hotel Benefits

• Luxurious and glamorous experience
• Full-service attention and pampering
• Desires catered for
• Highest standard of comfort and relaxation
• The difference between a 4-star hotel and 5-star hotel is the level of pampering and personalized staff attention that guests receive during their stay. While both offer on-site dining and activities, 5-star hotels take their experience above and beyond to make their facility something to brag about.

THE FIRST PHASE OF GRADING BY UTB SCORED 34 OF UGANDA’S FINEST FACILITIES

Additional data from webstaurantstore.com