As Uganda grapples with rising youth unemployment, experts are calling for improved financial management and targeted government initiatives to help youth-led businesses thrive.
Asaba Betty, a financial consultant at KPMG Uganda, warns that poor money management; not just a lack of capital is a major reason why many youth-led enterprises fail.
She explains that although young Ugandans are eager to start businesses, many of these ventures collapse within months due to poor financial habits and inadequate planning.
“Young people have ideas and energy, but when it comes to managing money, budgeting, saving, and planning, they are often flying blind,” Asaba says.
Driven by the urgency to escape unemployment, many young people have flooded into entrepreneurship without conducting market research, borrowing money without clear repayment strategies, and spending without tracking expenses.
“The desire to look successful before being successful leads many to misuse seed money, which puts their businesses in trouble from the start,” she adds.
According to Uganda’s 2024 National Population Census report, over 10 million Ugandans aged 18 to 30 are unemployed nearly half of the youth population.
In light of this, entrepreneurship is increasingly being promoted as a solution.
Despite these challenges, Asaba remains hopeful, emphasizing that with proper financial education and government support, Uganda’s youth can turn their entrepreneurial ventures into successful businesses.
Ramathan Ggoobi, the Permanent Secretary and Secretary to the Treasury (PSST), outlined the Ugandan government’s ongoing efforts to address youth unemployment.
He highlighted initiatives such as the Parish Development Model (PDM), which injects over UGX 1 trillion annually into parish-level revolving SACCOs, aimed at helping households transition from subsistence to the money economy.
“The youth are at the center of PDM and are provided with access to affordable credit at 5% interest, along with entrepreneurial training, value-chain integration, and financial skills,” Ggoobi said.
He stressed that the funds are intended for productive investments not consumption and should be used wisely to foster long-term wealth creation.
Ggoobi emphasized that with the government’s focus on fiscal sustainability, the PDM offers young people the opportunity to access credit and training, making entrepreneurship more accessible and viable.
However, he noted that even the most innovative start-ups can fail without a solid financial foundation.
In line with this, Asaba recommends that young entrepreneurs adopt a culture of micro-saving.
“Even saving a few thousand shillings weekly can help build a meaningful safety net and fund future ventures,” she said.
All in all, while skills are crucial, young people must also master the basics of budgeting, managing debt, and tracking profits to ensure long-term success in their businesses.
