The investment climate in East Africa is undergoing scrutiny as concerns emerge regarding governance and transparency in Uganda.
Recent developments, including the case of the illegal detention and arrest of Vasundhara Oswal, an Indian-Swiss businesswoman and key investor in the region, have brought attention to the need for stronger investor protections and regulatory oversight to ensure a stable business environment within the East African Community (EAC).
Uganda, a member of the EAC, has been recognized as an emerging investment destination. However, recent challenges highlight the importance of legal safeguards and investor confidence amidst global human rights criticisms/violations and a collapsing legal system.
On October 1st, 2024, Vasundhara Oswal was illegally detained and forcibly removed from her worksite without any warrants under unclear circumstances. During her detention, she faced difficult conditions, including no access to food, water, medical care, and legal representation.
Despite a high court-ordered release and Uganda’s own disregarded constitution, clearly making it illegal to be detained for more than 48 hours, she was held for an additional 72 hours before being presented to Luwero magistrate court (located 65kms north of capital city-Kampala) and slapped with a capitol charge without even a pinnacle of evidence being presented against her.
She was being held on charges of kidnapping and intent to murder Mr.Mukesh Menaria, a former employee of the Oswal family.
Even after the allegedly missing person was found, the capital charges were kept on her for an additional 2 weeks, where she was still kept in a jail for convicted murderers in horrific conditions.
After this, the charges were withdrawn by the Director of Public Prosecutions and were replaced with a misdemeanor charge on December 16, 2024, which was evidently done to continue to allegedly extort money from the family as now the video of the main Investigation Officer, Mr Baale Thomas, on the case will show.
Such incidents raise important discussions about the need for clear regulatory frameworks and strengthened governance to support foreign direct investment (FDI) in Uganda and the wider EAC region.
In the last few months, Uganda has been globally criticised for the mishandling and incarceration of the current opposition leader Kizza Besigye Kifeefe and has also received widespread condemnation for the current military head and son of President of Uganda, Muhoozi Kainerugaba, for the openly threatening behaviour online towards other countries.
“Transparency and accountability are critical in maintaining the region’s attractiveness for global investors. Addressing governance challenges will not only help improve investor confidence but also ensure that economic growth continues across the EAC,” opines a member of the Oswald family and adds: “The EAC has a role to play in fostering a stable and predictable investment environment. Strengthening governance and legal protections will reinforce the region’s economic credibility and support long-term growth.”
Some investors, including the Oswal family, have re-evaluated their commitments in Uganda, opting instead to relocate planned investments to Tanzania, which is seen as offering a more predictable business landscape.
“This is not just about one investor’s experience. It is about ensuring a business environment that supports investment and economic development. A stable and transparent system benefits all stakeholders, fostering confidence in the region’s future. With FDI serving as a major contributor to economic expansion, EAC nations can work collectively to strengthen investment conditions. Addressing governance concerns will support continued investor interest and regional growth, ensuring that East Africa remains a key destination for international business,” says Vasundhara Oswal.
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