Youth seek incentives to support startup ventures

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Although various government programmes have been implemented to generate job opportunities for the young, many youth-led startups still face considerable challenges, frequently failing in a short time.

The youth are now calling for deliberate incentives to foster the development of youth-led entrepreneurial ventures.

The primary focus was on the difficulties associated with licences and taxes that must be covered using a portion of the funds received from government initiatives, such as the Parish Development Model (PDM), to launch a business.

During a national youth engagement event organiased by the Ngabo Youth Friendly Services Initiative, with support from Plan International Uganda at the Kampala Capital City Authority Youth Centre in Kabalagala, in Makindye on December 16, 2024, Claire Dorothy Nabuko, a youth activist Safe and Inclusive Cities Project, highlighted that many young entrepreneurs present innovative ideas; however, a significant number of businesses fail within their first year.

“In case they access the funds from government programmes like PDM, they are challenged on how to sustain the ventures. They spend part of the funds paying for licenses and taxes, yet the business is small. Let us say they get sh1m from PDM,” she said.

The event brought together youth leaders and Members of Parliament to discuss the challenges confronting youth startups.

Nabuko also emphasized the importance of financial literacy training for young individuals to effectively manage a business and undergo a transformation in their mindset.

Ismail Saxafi, a team leader at the Aidor Refugee Initiative, highlighted that many programs are exclusive and do not include refugees, yet many of the young people in the camps and settlements possess valuable skills which they can use to look after their families.

“We request the Government to review the various programmes to include a portion of the refugee youth and women. Refugees in Uganda are part of the community and need to be supported to improve their livelihood, and be self-reliant as they contribute to the development of the country,” he added.

He also proposed implementing a resource allocation model akin to that used in humanitarian aid, allocating 70% of resources to refugees and 30% to host communities.

Ngabo Youth Friendly Services executive director, Sadat Zaga Ziwa, said while the youth receive startup capital to pursue their initiatives, they often encounter significant challenges in obtaining licences, permits and other necessary approvals. Zaga emphasized that this process frequently depletes a substantial portion of their funds, making it hard for their ventures to grow.

He also urged MPs to support the passing of the Youth Startup Bill, which was initially introduced as a private member's Bill by Boniface Okot. The Bill proposes solutions such as tax relief, affordable financing and support for innovative ventures.

Uganda has the world’s youngest population, with over 78% of its population below 30.

“If all youth start-ups are exempted from heavy taxation in the first or second year, their enterprises will grow. But imagine getting a million and using nearly half of it to pay licences and taxes. This automatically affects the business,” he added.

Terego District Woman MP, Rose Obigah, encouraged the youth to initially utilise the available government programmes.

Terego District Woman MP, Rose Obigah. (Courtesy)

She emphasized the importance of subsequently presenting their concerns to the Government, supported by concrete evidence illustrating why they are not reaping the intended benefits. 

“The youth are the biggest portion of the population of Uganda, but they have not got into solidarity to demand what is due to them. First, get involved and demand for other things. Many youths listen to what is there from a distance. I want to encourage that once you know that you are a youth, get closer to the table, see what is there for you,” she noted.

She also encouraged young people not to dismiss any job, provided it is legally acceptable and has the potential to enhance their quality of life.