Agriculture
Government officials, private investors, financiers and development partners gathered at the Golden Tulip Hotel in Kampala on August 19 for the first stakeholder engagement on the AgriConnect Compact, a proposed five-year cooperation framework between Uganda and the World Bank designed to address longstanding structural gaps across the country's agricultural value chains, from farm production and post-harvest handling through processing, quality assurance and market access.
The compact is Uganda's entry point into AgriConnect, a global World Bank Group initiative aimed at helping smallholder farmers move from subsistence production toward market surplus by improving access to finance, cooperatives, technology, digital tools and functioning markets. As part of the broader push, the World Bank Group has pledged to double its agriculture-related financing to $9 billion annually worldwide and mobilise an additional $5 billion in complementary investment, positioning agribusiness and job creation across Africa's farm economies as a central priority for the institution over the coming years.
For Uganda, where agriculture employs roughly 70 percent of the workforce, contributes about a quarter of GDP and generates an estimated 42 percent of total export earnings, the stakes attached to getting this framework right are difficult to overstate.
Naming the gaps
What distinguishes the AgriConnect Compact process from previous agriculture strategy documents, according to officials involved in the Kampala consultations, is its explicit focus on identifying and sequencing fixes to specific bottlenecks rather than issuing another broad statement of ambition. The consultations at the Golden Tulip Hotel centred on policy and institutional reforms capable of increasing private-sector participation, strengthening agribusiness enterprises and mobilising investment across priority value chains.
The gaps under discussion are ones familiar to anyone who has followed Uganda's agriculture sector closely: weak technical skills among farmers and extension staff, limited transfer of research and innovation from institutions such as the National Agricultural Research Organisation into farmers' fields, and infrastructure shortfalls in irrigation, transport and rural electrification that continue to cap productivity regardless of what happens at the farm level.
Those infrastructure gaps are not abstract. Uganda's irrigation coverage remains below 2 percent of farmland, according to figures cited by Agriculture Minister Frank Tumwebaze earlier this month, even though the National Irrigation Policy has set a target of 1.5 million hectares under irrigation by 2040 and formal irrigated area has stagnated at roughly 23,000 hectares for years. The African Development Bank has separately committed $140 million toward irrigation development in the Bunyoro sub-region, while the World Bank has signalled a return to larger-scale lending in Uganda's water-for-production space worth up to $2 billion, developments that predate the AgriConnect Compact but which the new framework is expected to help coordinate and reinforce rather than duplicate.
Electricity access on farms and in rural agro-processing zones remains similarly constrained, limiting the ability of cooperatives and small processors to run cold storage, milling or drying equipment reliably, a gap that compounds post-harvest losses estimated by the World Bank at between 22 and 30 percent of total crop production nationally, according to figures cited in recent parliamentary debate on a proposed National Post-Harvest Management Policy.
Following the money, and the politics, of Uganda's agriculture financing landscape
The AgriConnect Compact does not arrive in a vacuum. It lands atop a crowded landscape of recent Ugandan agriculture financing initiatives, including a Shs63 billion capital injection into the Uganda Development Bank earlier this month, of which roughly 65 percent of the bank's loan book is already directed toward agro-industrialisation, and a Shs428 billion, seven-year credit line between the European Investment Bank and Centenary Bank aimed partly at rural and women-led agricultural lending. Bank of Uganda's own Q1 2026 credit conditions survey found agricultural lenders tightening credit by a net 13.5 percent even as average agricultural lending rates sat above 20 percent, underscoring the financing squeeze many farmers and agribusinesses continue to face despite the proliferation of headline funding announcements.
Officials at the Kampala engagement framed the AgriConnect Compact as an attempt to bring coherence to this fragmented picture, aligning World Bank financing with existing government programmes such as the Parish Development Model, the Ten-Fold Growth Strategy for exports, and sector-specific pushes in coffee, dairy, fisheries and horticulture, rather than adding an entirely new, parallel funding stream that competes with rather than reinforces what already exists.
That coordination challenge is real. Uganda's agriculture sector has in recent years accumulated a long list of standalone interventions, from breeding programmes and seed traceability systems to insurance schemes and aggregation centres, many of them well-intentioned and individually well-funded, but not always linked to one another in ways that compound their impact for an individual farmer trying to move from subsistence to surplus production. A five-year compact structure, if implemented as designed, is meant to force a more disciplined sequencing: fix input access and extension services first in a given value chain, then irrigation and mechanisation, then post-harvest infrastructure, then processing and market linkages, rather than pursuing all of these simultaneously and unevenly across the country.
Why the timing matters
The Kampala stakeholder engagement comes at a moment when the vulnerabilities of Uganda's current agriculture export model are unusually visible. Ministry of Finance data released this week showed coffee export earnings falling more than a third in June 2026 compared with a year earlier, driven by lower international prices and reduced export volumes, even as Uganda's overall trade deficit widened to roughly $598 million for the month. Separately, an El Nino-linked above-normal rainfall outlook for August through December 2026 threatens to compound existing drought damage in Karamoja and other sub-regions, following a June to August dry spell that the Ministry of Water and Environment had earlier warned would stress crops, livestock and water resources.
Against that backdrop, the AgriConnect Compact's emphasis on climate-resilient infrastructure, functioning input and output markets, and stronger post-harvest handling is not simply aspirational policy language. It speaks directly to the twin shocks, price volatility in export markets and increasingly erratic rainfall, that have repeatedly hit Ugandan farmers over the past year, from the Karamoja hunger crisis to windstorm and flood damage in western districts to the milk supply disruptions around Mbarara linked to drought and disease.
What farmers and agribusinesses should watch for
For individual farmers and agribusiness operators, the practical significance of a five-year government-to-World Bank compact lies less in the Kampala launch event itself and more in what follows: the specific value chains selected for priority investment, the terms attached to any resulting credit lines or infrastructure spending, and whether implementation reaches beyond well-connected, large-scale operators to the smallholders who make up the vast majority of Uganda's farming population.
Previous World Bank-backed agriculture programmes in Uganda have had mixed records on this front, often succeeding in building infrastructure or disbursing credit lines through commercial banks, but struggling to ensure that benefits reach the smallest, most remote and most vulnerable farming households, precisely the population that subsistence-to-surplus transitions are meant to serve. Civil society groups and farmer organisations, including cooperative unions and district farmer associations, are expected to be consulted in subsequent phases of the compact's design, according to officials present at the Golden Tulip engagement, though the specific mechanisms for that ongoing consultation, and for tracking whether promised investments actually materialise on the ground, have not yet been detailed publicly.
The next several months are expected to bring further technical consultations, sector-specific working groups and, eventually, a negotiated compact document setting out financing commitments, priority value chains and implementation timelines. Whether the AgriConnect Compact succeeds in becoming the coordinating framework its designers envision, rather than another entry on Uganda's long list of overlapping agriculture initiatives, will depend on decisions still to be made in the months ahead, and on whether the political will exists to sequence and prioritise rather than announce and disperse.
