Uganda: Stakeholders Raise Concerns Over Mining Licensing Delays, Mineral Royalty Gaps

Why It Matters

Delays and revenue gaps undermine formal investment, erode fiscal capacity, and threaten Uganda’s broader economic diversification goals.

Key Takeaways

• Licensing delays push miners into informal sector.
• Gold exports exceed $5 billion, yet licensed mines are few.
• Royalty tracking weak; only 15% reaches local governments.
• Stakeholders propose mining revenue fund like petroleum model.
• Improved cadastre system needed for transparent mineral rights.

Pulse Analysis

Uganda’s mineral wealth, highlighted by $5 billion in annual gold exports, is increasingly viewed as a catalyst for the nation’s Ten‑Fold Growth Strategy. Yet the sector’s contribution to GDP has slipped to just 1.9%, reflecting systemic bottlenecks in licensing and a fragmented regulatory environment. The cumbersome documentation process discourages formal operators, funneling activity into an expansive informal mining economy that escapes official oversight and tax nets. This disconnect not only skews export data but also hampers the government’s ability to accurately assess the true value of its natural resources.

The revenue leakage extends beyond licensing inefficiencies. While the Ministry of Energy and Mineral Development channels mineral royalties to the Uganda Revenue Authority, only a modest 15% is earmarked for local authorities, leaving the majority under central control with limited transparency. Stakeholders argue that a structured mining revenue fund—mirroring the successful Petroleum Fund—could lock away earnings for long‑term development projects, ensuring that mineral wealth translates into tangible public benefits. Such a mechanism would also provide clearer accountability, reducing the risk of misallocation and fostering investor confidence.

Addressing these challenges requires a two‑pronged reform agenda. First, modernizing the Mining Cadastre system would deliver real‑time tracking of mineral rights, curbing illegal concessions and streamlining approvals. Second, accelerating the formalisation of artisanal and small‑scale mining through simplified licensing and fair royalty structures would bring a sizable informal workforce into the tax base. By learning from countries like Sweden and Australia, which have leveraged transparent revenue management to boost economic resilience, Uganda can transform its mining sector from a revenue‑draining liability into a sustainable engine of growth.