Uganda needs more listed companies, deeper share trading and stronger investor confidence to expand its capital markets and mobilise long-term financing for economic growth, Bank of Uganda Deputy Governor Augustus Nuwagaba said.
Speaking at a dinner marking the 30th anniversary of the Capital Markets Authority (CMA) on October 8th, Nuwagaba identified limited market liquidity, a shortage of domestic listings, competition from government securities and investment scams as key constraints on the sector.
Uganda’s domestic stock market capitalisation has exceeded 15 trillion shillings ($4.1 billion), while collective investment schemes hold more than 5.6 trillion shillings, according to figures presented by Nuwagaba.
More than 220,000 Ugandans have funded unit trust accounts, and over 235,000 investors have accounts at the Securities Central Depository, he said.
Despite the growth, participation remains limited compared with neighbouring Kenya, where unit trusts held about 851 billion Kenyan shillings on behalf of more than 3.6 million investors in the first quarter of 2026, Nuwagaba said.
Government debt competes with private investment
Government securities remain attractive to investors, but their returns can make it harder for private companies to raise funds at competitive costs, Nuwagaba said.
“When government pays a high coupon on a ten-year bond, a business must promise even higher returns to compete for the same shilling,” he said.
He called for the development of alternative investment instruments, including infrastructure bonds, green bonds, real estate investment trusts and Islamic finance products.
Nuwagaba also urged the government to expand opportunities for citizens to invest in strategic enterprises and called on businesses to consider public listings as a way of raising capital for growth.
He said Uganda’s capital markets should focus on financing productive enterprises rather than treating the number of listed companies as the sole measure of success.
Investor trust remains a challenge
Nuwagaba warned that fraudulent investment schemes promising unrealistic returns were undermining public confidence in legitimate financial markets.
He urged regulators and financial institutions to strengthen investor education and make regulated investment products more accessible through digital platforms.
Fund managers should develop products that can reach ordinary Ugandans, including farmers, teachers, market vendors and motorcycle taxi operators, he said.
He also called for pension reforms to increase the availability of long-term investment capital and urged brokers and dealers to improve liquidity in the stock market.
Regional integration
Nuwagaba said closer integration of East African capital markets could help attract investment by expanding access to companies and investors across the region.
Uganda, Rwanda and Tanzania have linked their trading systems through a regional capital markets infrastructure platform, while a regional index tracks leading companies across four markets, he said.
However, none of the main exchanges in Nairobi, Kampala, Dar es Salaam and Kigali recorded an initial public offering in 2025, highlighting the difficulty of persuading businesses to raise funds through public markets, he added.
Companies are increasingly turning to private equity to avoid the costs and disclosure requirements associated with stock exchange listings, Nuwagaba said.
He called for harmonised regulations, shared infrastructure and stronger cross-border enforcement to make regional markets more attractive to investors.
Uganda aims to build a $500 billion economy by 2040, and capital markets will need to play a greater role alongside bank lending in financing infrastructure and business expansion, Nuwagaba said.
“The first thirty years proved that capital markets can work in Uganda,” he said. “The next thirty must prove that capital markets can build Uganda.”
