Uganda is planning to establish and list a conglomerate or special purpose vehicle (SPV) of specific mining companies on the international capital market to raise funds for the mining sector. This move is in line with the commitment made by the government in February to form a national mining company as part of the Mining and Mineral Act 2022.
The plan involves creating a wholly-owned SPV that will act as a holding company for medium and large-scale mining enterprises. The SPV will attract capital and technology for the capital-intensive mining sector. It will also allow the government to hire international specialized concessions to manage the sector, sell equity to strategic investors, and acquire capital through leasing.
Furthermore, the SPV will facilitate the listing of shares on international capital markets and establish a revenue-sharing mechanism with investors. The government intends to establish a national mining company that will own up to 15 percent of stake in all medium- and large-scale mining companies in Uganda.
International capital markets offer opportunities for governments and companies to access foreign markets and new sources of funds. Uganda’s mining and quarrying sector has a significant contribution to the country’s GDP, and there is growing interest in exploiting its mineral resources, including rare earth, gold, copper, iron ore, cobalt, and more.
While the artisanal mining sector dominates mineral production in Uganda, the government’s efforts to attract international investment and expertise could help develop the mining sector and unlock its potential for economic growth.
