Series 5: After Access-Assessing digital inequality in Africa
Policy Paper no. 8: The State of ICT in Uganda
In line with global commitments to improve digital inclusion and to realise the Sustainable Development Goals for 2030, the Government of Uganda has committed the country to developing a digital vision for Uganda. It aims to build a digitally-enabled society that is “… secure, sustainable, innovative, transformative … to create a positive social and economic impact through technology-based empowerment”.
Poor Internet Penetration
The Vision aspires to deliver a variety of government and private services electronically in various fields – education, health, agriculture, social security, banking, justice and communication. The current draft of the Vision is constrained however by the fact that Uganda has one of the lowest (14%) Internet penetration rates of the 10 African countries surveyed by Research ICT Africa (RIA) as part of the Global South After Access Survey conducted between 2017 and 2018. Only Mozambique (10%) and Rwanda (9%) have lower penetration rates. The other countries in the Survey – Ghana, Kenya, Lesotho, Nigeria, Senegal, South Africa, and even Tanzania, another least developed country – have higher Internet penetration rates. Internet penetration is not the only area in which Uganda lags. Less than half of the population own a mobile phone, whereas this market is close to mobile phone saturation in countries such as South Africa (83%) and Kenya (87%).
Social Network Taxes
A number of contradictory policy and fiscal interventions have compounded this problem undermining efforts to realise the Digital Uganda Vision. In 2018, the Ugandan Government introduced retrogressive social media and mobile money taxes. Mobile money users are charged 0.5 percent on the value of withdrawal transactions, in addition to excise tax levied on withdrawal fees. The social media tax of UGX 200 (USD 0.05) per day was introduced on the use of 60 mobile apps, including Facebook, Instagram, Twitter and WhatsApp. The 2018 After Access Surveys and data demonstrate that social media sites are the main drivers of Internet uptake in Uganda and across the continent. They are also a significant substitute for costly voice and text services– a central strategy for citizens trying to make communications more affordable. The social media tax has impacted negatively on social networking use, which has impacted negatively on mobile operator revenues at a time when they are making the hard transition from voice to data services. The impact on this is not only that the poor take the brunt of the tax (instead of the global platforms that are not impacted at all), but the Government does not actually generate the anticipated revenue from the social networking and mobile money taxes as people curtail their use or find ways to circumvent the taxes through virtual private networks. Moreover, it has a negative effect on productive taxes and operator profits that subsequently decrease as a result of reduced data usage. These kinds of effects impact negatively on the Digital Uganda Vision in terms of digital and financial inclusion.
Acknowledgements
This research was made possible by the support received from Canada’s International Development Research Centre (IDRC and SIDA). The nationally representative ICT access and use survey referenced in this report forms part of a survey of 22 countries in the Global South (10 in Africa) that canvasses barriers to access from those not connected, as well as the challenges to optimal Internet usage even where there is coverage or the individual has connectivity (see After Access 2017). It draws on ongoing policy research and indicator development done in conjunction with the International Telecommunications Union (ITU). This national survey was undertaken with the assistance of the Uganda Communications Commission, the National Information and Technology Authority-Uganda, the Ministry of ICT and National Guidance, and the Uganda Bureau of Statistics. Research ICT Africa’s Uganda partners: Eng. Dr F. F. “Tusu” Tusubira and Ali Ndiwalana of Knowledge Consulting (KCL), led the fieldwork for which training was performed by Dr Onkokame Mothobi and was also supported by Jan Schenk of ikapadata.
