Uganda Development Bank (UDB) in partnership with the European Union (EU), has today announced the 2nd Tourism Facility, aimed at resuscitating Uganda’s hospitality industry.
The initiative was launched by UDB, at Lubya Hill, Georgina Gardens Hotel, with the prime goal of aiding Tourism related business entities recover from the negative effects of COVID-19.
It is important to assert that various Tourism related business entities completely collapsed, others suspended operations, while some retrenched most of their staff, due to a downturn in tour and travel as a result of COVID-19 informed lockdowns imposed by various countries.
Against this background, UDB is counting on allies and partners like EU, with the Tourism Intervention Fund, to help the sector recover from devastating effects of COVID-19.
The initiative is tailored towards giving people access to working capital, to enable fast-track recovery post the COVID-19 devastating effects.
The total Facility is over Shs.62 billion made up to Shs. 40 billion ring-fenced funds from UDB, and complemeted by a grant of Shs. 21.8 billion from the European Union. Under this facility, only customers that qualify for the loan will be eligible for the grant.
While addressing the congregation, state minister for Tourism, Wildlife and Antiquities Hon. Martin Magarura Bahinduka expressed sadness over the way COVID-19 ravaged the tourism sector in Uganda, and urged stakeholders to vigorously participate in this initiative, to ressurect and develop their businesses, by applying for funding from UDB.
“The Tourism sector was one of the sectors that was hit most because of COVID-19, and the lockdowns that came with COVID 19….probably we expect that this second call, because not everyone benefited in the first call, because of the stringent conditions that someone needed to meet to be able to be a beneficiary out of the facility, but I want to thank them for coming up with the second call that has made it a little beat easier for everyone to benefit out of this. And definitely, we are calling upon Ugandans, to come and participate, those in the hotel sector, and those amongst the tour operators,” advised Hon. Martin Mugarura.
Besides, Managing Director for UDB Ms. Patricia Ojangole also explained to the congregation that the facility’s major goal is to occasion the recovery of businesses that were seriously ravaged by COVID-19 informed restrictions and lockdowns.
“At the onset of the COVID-19 pandemic, Uganda like other countries, sanctioned travel restrictions within and out of the country. The travel restrictions and standard operating procedures contributed to a severe contraction of businesses opportunities and viability of businesses resulting in close for some, and eventual loss of jobs. This facility is targeting the recovery of these businesses as they take advantage of growing tourist traffic both local and foreign,” remarked Ms. Ojangole.
“This call is open to legally registered businesses that have been in operation for at least two years,” added Ms. Ojangole, as she implored applicants to demonstrate their businesses’ availability to retain employees during the period of the loan.
Most importantly, she stressed the commitment by UDB to facilitate agile innovations to match the needs of the population, and to support the mission of the bank in improving the quality of lives of Ugandans, through high impact innovations.
In the meantime, the head of EU cooperation in Uganda Ms. Caroline Adriaensen underlined a lenient procedure by the EU, to effectively address the needs of the tourism sector in Uganda, to enable its fast- tract recovery from the apocalyptic effects of COVID-19.
She empasised that the scheme would incorporate a list of eligible expenditures, companies initiated to make tourism establishments more environmental friendly.
“This could include investments aiming at improving waste management, promoting the use of alternative sources of energy, and going digital, among others. Indeed, the EU is committed to supporting the tourism sector in Uganda to ensure many more people from all over the world come and visit this beautiful and amazing country,” Said Caroline Adriaensen.
UDB Director-Credit Samuel Edem Maitua also plainly told participants that the innitiative is intended to stimulate businesses operating in the tourism sector, taking aim at retaining and reinstating employees who had been layed off, as a result of COVID-19 .
“… but some of the fundamental rationale behind this facility was to preserve tax revenue or the tax contribution of the tourism sector, which has been a very big player in the revenue sourcing, to stimulate businesses operations , we want to prevent the closure of businesses, why is this important, again it speaks to employment, we need to preserve our foreign exchange contribution of this sector, the foreign exchange that the sector brings is very critical for us to have adequate reserves as a nation,” Edem Maitua said.
“Again, we have added an aspect of support towards greening, and this speaks to energy efficiency, waste management,” added Maitua as he reiterated that such a move is very important, given the entity’s desire to conserve the environment.
The Tourism Investment Fund was designed in 2020, in partnership with key stakeholders in the sector, to respond to COVID-19 pandemic and its impact on businesses operating in tourism and hospitality industry.
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