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Makerere Presents Nepal’s Community Forest Management Model to Government Agencies

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In 2023, the Ugandan team comprising Dr. Peter Babyenda of Makerere University EfD-Mak Centre, Christine Mugyenyi and Rukundo Tom from the National Forest Authority went to Nepal to study the Community Forest Management Model. The study tour was funded by EfD Global Hub and the National forestry Authority Uganda.

The study tour  was one of the activities of EfD Forest Collaborative Peer Learning Project on Community Forestry aimed at deepening the understanding on community-based forestry management and  sharing ideas and experiences regarding forestry among the participant countries.

This study was timely given the current efforts by Ugandan government to increase the forest cover to 24% by 2040. Through community forest management, the people of Nepal have been able to increase their forest cover to 45% from 29% in 1992.

A section of participants in the ministry boardroom. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
A section of participants in the ministry boardroom.

As such, Nepal provides a practical example of how the community can be empowered to manage forests and significantly contribute to the general growth of forest cover in the county. The leadership of the forest user groups also act as training ground for the national leadership and as a result, the national leadership also participates in the sustainable utilization of forests.

Nepal presents an interesting scenario demystifying practices in many other countries where local people are seen as enemies of forests. Through Community Forest User Groups (CFUG), Nepal’s model demonstrates how local people, are at the forefront of protecting forests in Nepal.

The experiences from Nepal should act as the guide to successful forest management in other countries including Uganda. In addition, the study tour was informative with vast knowledge attained from different stakeholders on implementation of community forestry.

A participant discussing during the question and answer session. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
A participant discussing during the question and answer session.

The study tour involved meetings with the different stakeholders, field visits in some of the community forests and experiencing the Nepalese culture through visiting religious and cultural sites. The 5 days program was under the guidance  of the Forest Action – Nepal and coordinated by Professor Randy.

The tour started with the visit to Kalopani Community Forestry User Group (CFUG), which is in a mountainous site in Kavre District. The team visited a second CFUG on the way to our meeting with the Kavre Divisional Forestry Office, which has jurisdiction over Kalopani CFUG. The team also visited Kavre Divisional Forestry Office and held discussions with the Dean of the Tribhuvan University Institute of Forestry.

EfD-Mak centers disseminates study findings to government agencies

Research fellows from EfD-Mak centre from Makerere University on 27th February 2024, went to the Ministry of Water and Environment to disseminate information on lessons learnt from Nepal’s community forest management.

Mr. Stephen Mugabi (Right) chaired the meeting and officially opened the workshop. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
Mr. Stephen Mugabi (Right) chaired the meeting and officially opened the workshop.

The workshop hosted by the ministry’s headquarters in Luzira, was attended by over 30 forestry officials from government ministries, departments and agencies including the National forest Authority, Uganda world life Authority and National Environmental Management Authority.

While officially opening the workshop on behalf of the Permanent Secretary Ministry of Water and Environment, The Commissioner, Environment Sector Support Services Stephen Mugabi hailed the EfD Mak center for the continued partnership that was initiated with the ministry.

Noting that the mandate of managing the environment lies within the ministry, Mugabi said it was the right decision that the centre decided to link up with the ministry.

Mr. Stephen Mugabi, also Member of EfD-Mak  Advisory board chaired the meeting.
Mr. Stephen Mugabi, also Member of EfD-Mak Advisory board chaired the meeting.

“When you generate information and you don’t share it, and archive it, it will not be useful. Once information is disseminated and gets to the stakeholders, they get knowledge that is then transformed into action. And the moment knowledge is transformed into action, then we see the knowledge changing livelihoods of communities”, He explained adding that:

“Today you have been recruited as ambassadors of the EfD-Mak Centre. You are receiving information how people in Nepal manage their forests and we expect you to disseminate it further to the people whom you live with.” Mugabi emphasised

Mugabi expressed the need for participants to understand the definitions of a community forest away from the standard definition of a forest on grounds that the way the community understands the forest is far different and has many values attached.

Prof. Edward Bbaale (Left) delivering his speech as the PS representative Mr. Stephen Mugabi (Right) listens. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
Prof. Edward Bbaale (Left) delivering his speech as the PS representative Mr. Stephen Mugabi (Right) listens.

The Director EfD-Mak centre who is also Director, Directorate of Makerere University Graduate Research and Training Prof. Edward Bbaale appreciated the EfD Global hub funded by Sida, for sponsoring the Peer Learning Project for Community Forestry for policy makers and researchers, with a visit to Nepal.

“Today marks a significant moment as our colleagues share insights from their visit to Nepal’s community forest model, a success story empowering communities to manage nearby forests sustainably.

Nepal’s model granting legal rights to use and manage forest resources, stand as an exemplary solution against deforestation – a lesson we find particularly relevant given Uganda’s challenges”, Bbaale said.

Prof. Edward Bbaale addressing participants in the Ministry boardroom. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
Prof. Edward Bbaale addressing participants in the Ministry boardroom.

Prof. Bbaale also noted that with 70% of the total forest cover under private land and the prevalent use of firewood and charcoal, Uganda faces alarming rates of forest losses.

“The presentation today is timely source of inspiration for policy makers and researchers, demonstrating the positive impact of involving local communities in decision making and forest management, addressing both environmental concerns and social inequalities,” Bbaale stressed.

He extended gratitude to the Ministry of Water and Environment for hosting the engagement at their headquarters and commended the enduring collaboration between EfD-Mak Centre and the Ministry.

Bbale also extended appreciation to the ministry and government for supporting the Inclusive Green Economy program for senior public servants. The Director, Stephen Mugabi represents the Ministry on the EfD-Mak Advisory Committee. The ministry appointed   Commissioner Moreen Anino on the first cohort of the IGE fellows.

Dr.  Peter Babyenda speaking during the dissemination meeting. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
Dr. Peter Babyenda speaking during the dissemination meeting.

Uganda’s Inclusive Green Economy Engagement Specialist and research fellow Dr. Peter Babyenda said, in 2023, the team went for a study tour in Nepal to learn on the successful community forest management practices that Nepal had employed to increase their forest cover 29% in 1990 to 45% in 2013.

Contrary, Uganda’s forestry cover has decreased from 24% in 1990 to now 13% and, in 2010, the forest cover had further decreased to 9%.

He said, it was deemed appropriate to share the study findings with the ministry’s agencies who hold the country’s natural resources in trust of the people of Uganda.

“We learnt that that once you organise the people, tell them what to do and the importance and gains from the forest, they will take care of the forest, and if you do something detrimental to the forest, you are punished as a community member.

Dr. Peter Babyenda makes a presentation during the dissemination meeting. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
Dr. Peter Babyenda makes a presentation during the dissemination meeting.

Communities that stay near forests have records of everyone including their photos and they will get to know who does what. They have a well organised inclusive leadership comprising 50% men and female, very transparent with books of accounts that are audited.

We even visited the university that trains leaders so they do capacity building of their leaders together with the department of forestry and wild life and ministry of forestry”, Babyenda explained.

Nepal has about 22,000 community forest user groups benefiting about 2.9million households. The community manages about 2.2million hectares of forest.

Babyenda reported that the community forest management model in Nepal has contributed to forest restoration and made it easy to mobilize the community to ensure that degraded forests are restored. This , he added was evidenced by the increase in the forest cover from 29% in 1992 to the current 45%.

An Environmental Police Officer participates during the meeting. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
An Environmental Police Officer participates during the meeting.

The model according to Babyenda, has contributed to community infrastructure and livelihood benefits because CFUGs are used as a vehicle to community development evidenced by several community development projects seen.

Further, Babyenda explained that not only does Nepal’s model contribute to ecosystem functioning and protection, it has contributed to mitigation and adaptation to climate change largely, due to the maintenance of forests that absorb carbon but also regulates temperature.

“The model contributes to household income generation through the sale of forest products in a sustainable way. The households are aware of the consequences of mismanaging forests and thus utilize them in a sustainable way.

A participant making an input during the discussions. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
A participant making an input during the discussions.

This is commendable and other countries like ours need to take lessons”. Babyenda noted and commended Nepal for the inclusive leadership with at least half of the leadership of the user groups being female.

Key Lessons from Nepal’s Community Forest Management Model for Uganda

The existence of a legal body, (FECOFUN- Federation for Community Forestry Users, Nepal) has enabled voicing the rights of community adjacent groups. The CSO has played a very important advocacy role on the rights of women, elders, and marginalized groups. It has also played an important role of influencing forest related polices in Nepal.

UNETCOFA a CSO was established in Uganda in 2006, to unite CFMs but lacked legal barking and has not done much work in relation to CFM networks. The lesson learnt is to involve the Ministry of Water and Environment to revive UNETCOFA.

FECOFUN has created a strong network with the CFUGs, and this enables the groups implement their roles and responsibilities which has minimized non-compliance to the operational plans of the community forests. Commitment by the CFUGs households to protect, restore and conserve forests has largely been informed by previous calamities like earthquakes and floods which is not the case for Uganda.

Value addition on forest products like timber, fodder and herbs has increased the income and created some jobs for the CFUGs.

Community Forestry in Nepal has thrived on many different models for instance knowledge production and knowledge use in forestry and the presence of homogenous society. Improving livelihoods where forest conservation meets the demands of local communities provides an overall incentive for sustainable conservation including safeguarding essential ecosystem services.

Christine Mugyenyi one of the study beneficiaries (Right) sharing experiences from Nepal. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
Christine Mugyenyi one of the study beneficiaries (Right) sharing experiences from Nepal.

Having a dynamic, diverse, and respected leadership within community groups increases chances of success as is the case for some CFUGs in Nepal. Involvement of women in use of forest resources recognizes the importance of having women represented in decision- making and giving women a voice has allowed them to actively participate in conservation activities.

Benefit sharing through wealth ranking to target the poor for support is very key and can minimize elite capture. In addition, sharing of benefits/ income accrued from sale of forest products in percentages for instance 25% is invested in forest management was a key lesson to learn.

CFUGs coordination with local government to put up infrastructural development like schools or road construction from the income attained from the sale of forest resources was a key lesson learnt.

Community Forestry has contributed to ecosystem functioning through provision of fresh water supply to the households and for agricultural purposes. Most forest adjacent communities in Nepal access piped water from the forest for both domestic uses including watering animals and irrigation of crops. This has enabled conservation of water sources and regulation of waste discharge.

One of the participants makes his contribution during the discussion. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
One of the participants makes his contribution during the discussion.

Alternative energy/ biomass source in Nepal is at 60%. People are increasingly using LPGs, electricity, petroleum gas etc. This has decreased fuelwood usage in Nepal. The lesson is  that GoU need to reduce costs of gas and electricity to enable less dependency on fuelwood from forests.

Activities implemented during the study tour

Babyenda reported that, activities implemented during the Nepal study tour involved meeting the Federation of Community Forest Users Nepal (FECOFUN) executive members during which it was noted that FECOFUN was founded and legally recognized in July 1995 as a social movement organized which later became a civil society organization. It was formed after the legal recognition of Community Forestry in Nepal in 1992 and realization for the urgency to advocate for the rights of the people. It is established in all the 77 districts in the country with over 22,000 Community Forest User Groups are affiliated to FECOFUN and managing 2.2m ha that is; 25% of the forest cover which is contributed under community forestry of the overall forest cover of 45% with 2.9million H/Hs benefiting from community forestry.

The team also held a meeting with the departments of Forests and Soil Conservation-Nepal and Department of National Parks and Wildlife conservation. The forest management model indicated that Community Forests are part of the National Forests handed over to the traditional users for its conservation, utilization, and management guided by the Forest Act, 2076(2019AD), Forest Regulation 2079 (2023AD) and community guideline 2071.

Moreen Anino one of the pioneer IGE Fellows (Right) closing the meeting. Makerere University EfD Centre Nepal Community Forest Management Visit Lessons Dissemination, Ministry of Water and Environment, Luzira, Kampala Uganda, East Africa.
Moreen Anino one of the pioneer IGE Fellows (Right) closing the meeting.

The department   guides the CFUG in facilitation done through formation of forest user groups and implementing biological diversity, conservation and climate change adaptation related activities and Legal support through identifying, developing, and managing potential forest areas in accordance with the prevailing laws, rules and policies, Community Forest user group registration and Community Forest handover.

Babyenda said the team made field visits to Kalapani community forest and in Shiba Community Forest and the CFUG members. The Community members mainly utilize forest resources like firewood, fodder, grass, timber, and medicinal plants and performs various roles.

In a meeting at the Institute of Forestry- Nepal with the Dean of forestry and the college staff. Babyenda explained that they shared information on Community forestry on how Community forestry has contributed to forest restoration, community infrastructure and livelihood benefits and ecosystem functioning among others.

Detailed report on study findings is attached.

Jane Anyango is the Communication Officer EfD Uganda

Jane Anyango

Business & Management

Dissemination Workshop: Government and Regulators urged to formalize the informal sector

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Prof. James Wokadala (4th Right) poses for a group photo with participants at the dissemination workshop on 29th August 2025. College of Business and Management Sciences (CoBAMS) and the Copenhagen Business School, in partnership with Uganda Small Scale Industries Association, dissemination workshop on Firm Formalization and Sustainable Development, 29th August 2025, CoBAMS Conference Hall, Makerere University, Kampala Uganda, East Africa.

On 29th August 2025, researchers from Makerere University College of Business and Management Sciences and the Copenhagen Business School, in partnership with Uganda Small Scale Industries Association disseminated the key findings and policy recommendations aimed at impacting both the informal and formal sectors in Uganda.

The dissemination workshop follows an intensive and participatory research project, which presents insights from a large scale study of over 1,100 small-scale firms across Uganda. Hosted at Makerere University, the dissemination workshop on Firm Formalization and Sustainable Development, brought on board key stakeholders including regulators, policy implementers, researchers, industry partners, the private sectors, manufactures, the academia, business men and women from the informal sector, and the media.

Approximately 90% of Small and Medium Enterprises (SMEs) in Sub-Saharan Africa operate in the informal sector. Uganda’s informal economy employs the majority of workers, but is characterized by low productivity and unsustainable practices. In Uganda, nearly 78% of the working population operate in the informal economy, spanning from street vendors to large unregistered businesses. Firms may choose to remain informal to hinder the accessibility of tax information, which consequently affects the government’s ability to mobilize domestic revenue. While informality provides livelihoods and informal firms may enjoy a significant degree of adaptability and flexibility, they typically face low productivity, limited worker protection, and environmentally harmful practices.

In 2022, an interdisciplinary team of scholars and practitioners embarked on research to examine the informal sector, gain a deeper understanding of the informal sector, as well as, its impact on sustainable development. The research team conducted field experiments and survey-based studies between 2022-2024 to evaluate the links between formalization and sustainable development.

Prof. Faisal Buyinza. College of Business and Management Sciences (CoBAMS) and the Copenhagen Business School, in partnership with Uganda Small Scale Industries Association, dissemination workshop on Firm Formalization and Sustainable Development, 29th August 2025, CoBAMS Conference Hall, Makerere University, Kampala Uganda, East Africa.
Prof. Faisal Buyinza.

Led by Prof. Marcus M. Larsen as the Principal Investigator, the research team consisted of the following the members: Prof. Faisal Buyinza-Local Principal Investigator, Dr. John Seruyange-Makerere University School of Economics, Dr. Ismail Kintu and Dr. Yusuf Kiwala-Makerere University School of Business, and Prof. Rebecca Namatovu-Copenhagen Business School. The research was funded by the Independent Research Fund Denmark.

“Our research shows that formalization can promote sustainable development, but outcomes differ by type: URA tax registration drives the most meaningful improvements in business, labour, and environmental practices, while URSB business registration mainly boosts legitimacy and local government licensing lags behind. To realize Uganda’s green and inclusive growth goals, formalization must be coupled with sustainability incentives, targeted reforms, and strong support from government, business associations, and civil society. From the policy perspective, the government needs to simplify the legitimization process through increased proximity of the registration centres for SMEs to leverage the benefits of formalization.”

Opening the dissemination workshop, the Principal of the College of Business and Management Sciences-Prof. Edward Bbaale represented by the Deputy Principal, Professor James Wokadala, emphasized the significance of the study in shaping Uganda’s development agenda.  He underscored that Makerere University is committed to undertaking research with partners to drive inclusive growth and sustainable economic development. The Deputy Principal noted that the interdisciplinary research team combining the global north and global south expertise, positions the College of Business and Management Sciences at Makerere University, to produce impactful research to influence policy and practice at the national and global levels.

Ms. Veronica Namwanje. College of Business and Management Sciences (CoBAMS) and the Copenhagen Business School, in partnership with Uganda Small Scale Industries Association, dissemination workshop on Firm Formalization and Sustainable Development, 29th August 2025, CoBAMS Conference Hall, Makerere University, Kampala Uganda, East Africa.
Ms. Veronica Namwanje.

Unpacking the key concept in the research project, Ms. Veronica Namwanje, the Director of Uganda Small Scale Industries Association (USSIA) explained that formalization goes beyond business registration. “Formalization is about strengthening enterprises to grow sustainably,” she articulated. Commending the partnership between USSIA and the School of Economics at Makerere University, Ms. Namwanje stated that this collaborative learning experience will strengthen SME’s in Uganda. “This research will significantly impact Uganda’s economy. 75% of the labour force is employed in the non-formal sector. The research will support over 12,000 member SMEs across Uganda,” she said.

Building on the remarks from the College Principal and the Director of USSIA respectively, the Moderator of the dissemination workshop, Dr. Anthony Tibaingana called upon the project Principal Investigator, Prof. Marcus Larsen from Copenhagen Business School, to present to the audience, the gist of the research on formalization and sustainable development.

Dr. Anthony Tibaingana. College of Business and Management Sciences (CoBAMS) and the Copenhagen Business School, in partnership with Uganda Small Scale Industries Association, dissemination workshop on Firm Formalization and Sustainable Development, 29th August 2025, CoBAMS Conference Hall, Makerere University, Kampala Uganda, East Africa.
Dr. Anthony Tibaingana.

Prof. Larsen commenced his presentation by acknowledging the Local Principal Investigator, Prof. Faisal Buyinza and Makerere University researchers in Economics and Business for their commitment and dedication. “This project started in 2022. You have worked with me wholeheartedly. Thank you for being true partners,” he remarked. Prof. Larsen explained that this research exposed him to the beautiful country called Uganda, its fine weather and hospitable people. As this particular research project comes to an end, he leaves Uganda and Makerere University with good memories, of working with people, committed to the transformation of society.

Setting the pace into his presentation that provided a strong case for formalization of business given its contribution to inclusive growth and development of any country, Prof. Larsen provided a comparison between the Global north where formalization is a norm.  “The Global North has zero tolerance for informal practices. In the Global North, you must be formally registered to operate a business,” he reported.

In the Global South, Prof. Larsen disclosed that the research studies proved that the number of firms under the informal sector was quite high. Through the research project, Firm Formalization and Sustainable Development in Uganda, they observed that many small scale businesses operate without any form of registration, from the Uganda Revenue Authority (URA) and the Uganda Registration Services Bureau (URSB).

With over 78% of the working population employed in the informal economy through numerous establishments (ILOSTAT, 2024), Prof. Larsen stressed that the situation in Uganda, necessitates a combined effort to ensure formalization of businesses/firms. He notified the audience about Sustainable Development Goal (SDG) 8.3, which encourages the formalization and growth of micro, small and medium sized enterprises. He also made reference to Uganda’s 4th National Development Plan, which states, and I quote: “This dual nature of informality contributes to low productivity, survival and growth of enterprises, as well as, limiting effectiveness of government policy incentives.”

Prof. Larsen argued that addressing high firm informality in the Global South through formalization can unlock growth, enable access to resources, spur sustainable development, drive inclusive growth, and contribute to the realization of Sustainable Development Goals (SDGs).

Examining SMEs and the environment, Prof. Larsen reported that the research findings indicated that that environmental issues are given less attention by SMEs. “Informal workers are particularly affected by and affect climate change. Most of the interactions proved that informal workers use environmentally unfriendly practices,” he stated. Prof. Larsen together with the research team advocated for a transition to formalization of firms, which leads to environmental sustainability with decent workers.

Prof. Marcus Larsen presenting the research insights. College of Business and Management Sciences (CoBAMS) and the Copenhagen Business School, in partnership with Uganda Small Scale Industries Association, dissemination workshop on Firm Formalization and Sustainable Development, 29th August 2025, CoBAMS Conference Hall, Makerere University, Kampala Uganda, East Africa.
Prof. Marcus Larsen presenting the research insights.

The research team observed that informal workers suffer from job insecurity, and in most cases, their employers do not remit their social protection funds. For instance, in Uganda, most of the workers in the informal sector did not have any contributions with the National Social Security Fund (NSSF).

Presenting the key research insights, Prof. Larsen focused on the formalization and practices, interpretation for policy makers, and SME survival and sustainability. Formalization and Practices provided hints on URSB (business registration), URA (Tax Registration) and Local Government (Trading Licenses).

Providing the interpretation for policy makers, Prof. Larsen elaborated as follows: URSB formalization mainly signals legitimacy, but has limited impact on deeper practices; URA formalization, though resisted initially, delivers the strongest and broadest improvements in business, worker and environmental practices once firms adopt it; and Local government licensing is associated with negative or weak outcomes indicating a need to reform systems to better incentivize sustainability.

On SME Survival and Sustainability, the key research insights include the following:

Financing: MSMEs that started with external financing were 12% more likely to survive than those using internal funds.

Gender: Male owned MSMEs had a higher survival rate (+13%) due to greater access to resources, though firms owned by females reported stronger sustainability orientations.

Location: Urban-based firms had 10-20% higher survival than rural firms, though rural enterprises displayed higher sustainability practices overall.

Education: Owners with university education had survival rates 17 to 24% higher than those with primary schooling.

Business associations: Female-owned MSMEs in associations had 13 to 16% higher survival rates

Registration effects: Surprisingly, longer registration with URA/URSB was associated with slightly lower survival rates (1 to 4%), pointing to burdens of compliance.

The Local Principal Investigator, Prof. Faisal Buyinza, advocated for multi-faceted policies to empower SMEs in Uganda for instance, through simplifying registration, providing green tax incentives, protection of workers and guarding against counterfeit products.  Prof. Buyinza presented the following policy recommendations:

  • Raising sustainability standards in business formalization
  • Building green and fair fiscal systems
  • Strengthening social protection and green employment
  • Enhancing entrepreneurial skills for sustainability
  • Promoting youth and ago-led green innovation
  • Advancing women’s leadership in sustainable enterprises
  • Digital transformation for green formalization
  • Civil society and employer advocacy for just transition

The participants delved into an interactive question and answer session moderated by Prof. Eria Hisali, former Principal of the College of Business and Management Sciences, who provided strategic guidance and oversight at the inception of the research project.

Prof. Eria Hisali. College of Business and Management Sciences (CoBAMS) and the Copenhagen Business School, in partnership with Uganda Small Scale Industries Association, dissemination workshop on Firm Formalization and Sustainable Development, 29th August 2025, CoBAMS Conference Hall, Makerere University, Kampala Uganda, East Africa.
Prof. Eria Hisali.

Prof. Hisali called upon the participants and key stakeholders to contribute to the discussion, when he said: “The informal sector is not abstract. The informal sector is with us. I therefore call upon you to share lived experiences and practices on this matter.”

Taking on the form of a plenary, the following ideas were raised:

  • Financial constraints are a major blow to SMEs. This is further complicated by the payments required through registration, licensing, taxation, and other formalization processes including the high cost for online operations that require access to the Internet.
  • Power outages in Uganda significantly affect business operations. When power is on and off, SMEs incur losses due to the nature of their activities.
  • URA has a close working relationship with Uganda Small Scale Industries Association (USSIA). This partnership should be leveraged to reach out to business owners in the informal sector.
  • The government should provide tax incentives to local investors. This incentive will positively impact formalization of businesses.
  • URBS should come up with tough measures on standards in order to safeguard Ugandans from counterfeit products.
  • URA and URSB should note that majority of players in the informal sector are not educated, and, as such, should come up with specialized awareness programmes delivered in a language that they can understand.
  • Noting that despite the benefits of formalization, entrepreneurs fear to formalize their business, those concerned should invest time and resources to identify the reasons behind this attitude.
  • Create awareness by deliberately popularizing the benefits of formalizing a business, and the incentives that accrue to someone who has formalized his or her business.
  • Commending the stakeholder mapping and segmentation with respect to policy recommendation, the participants requested for the involvement of the Ministry of Gender, Labour and Social Development.
  • Tackling the policy recommendation on digital transformation, the participants recommended the involvement of NITA-Uganda.
  • Formalization of businesses and registration is affected by the high cost of Internet services and subscriptions. The participants reported that the high costs of Internet deter online operations.

Reflecting on the ideas raised during the plenary sessions, Prof. Hisali observed differences in the level of awareness regarding business formalization. He called upon the Uganda Small Scale Industries Association and Makerere University to continue the discussion with key stakeholders to conduct periodic awareness creation and training sessions.

On a positive note, the participants and stakeholders were notified that URA was in advanced stages of according tax holidays to SMEs. Prof. Faisal Buyinza, who interacted with URA, during the course of the research project (2022-2024), highlighted that effective July 2026, start-up business up to UGX 300million, will not be taxed. Such start up business, will enjoy a tax holiday of three years.”

The submission from Prof. Faisal Buyinza was supported by officials from URA who were physically present in the dissemination workshop held in the Conference Hall, at the College of Business and Management Sciences, Makerere University.

The participants were thoroughly engaged during the dissemination workshop, which entailed remarks from the College Principal, presentation by USSIA, project purpose and findings, research presentation, policy implications, question and answer session, and final reflections.

Ritah Namisango
Ritah Namisango

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Business & Management

Carbon Prices Too Low to Cut Emissions, Says Canadian Professor Mark Purdon at EfD-Mak Seminar

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Prof. Purdon (Centre Front Row) in a group phto with participants after the presentation on 27th August 2025. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.

Kampala, Uganda – August 27, 2025
A new study spanning a decade has revealed that the prices currently offered for carbon credits and other climate finance instruments are too low to meaningfully reduce greenhouse gas emissions in developing countries.

The findings were presented by Canadian scholar Prof. Mark Purdon during a seminar at Makerere University, where he launched his new book “The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State.” The event, hosted by the Environment for Development (EfD) Mak Centre, attracted graduate students and academic staff from the Schools of Economics and Agricultural Sciences.

Prof. Purdon, an Associate Professor at Université du Québec à Montréal (UQAM), based his conclusions on a comparative study conducted between 2008 and 2018 in Uganda, Tanzania, and Moldova. His research showed that while carbon markets and climate funds are theoretically designed to reduce emissions, their real-world effectiveness is constrained by the low financial incentives attached.

Prof. Purdon and a section of graduate students before presenting. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Prof. Purdon and a section of graduate students before presenting.

“Carbon prices during the period I studied were simply too low to drive meaningful emission reductions,” said Prof. Purdon. “They only worked in contexts where governments were already trying to push development initiatives-like Uganda’s forestry projects and the climate finance just helped amplify that effort.”

The research contrasts Uganda’s relatively proactive approach with Tanzania’s limited engagement, attributing the difference not to institutional capacity but to political will.

“In Tanzania, the government just wasn’t genuinely interested in these instruments -they didn’t find the financial incentives compelling. Uganda, on the other hand, saw even the modest funding as worth integrating into its broader development goals,” he added.

Prof. Mark Purdon introduces the book and his research project. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Prof. Mark Purdon introduces the book and his research project.

Interestingly, Moldova also showed effectiveness similar to Uganda, despite having different levels of state capacity. Prof. Purdon emphasized that success in utilizing climate finance depends more on political interest than institutional strength alone.

The seminar highlighted the importance of domestic commitment in making international climate finance work. According to Purdon, climate finance is unlikely to succeed in countries lacking political interest, regardless of the mechanisms in place.

The professor’s book aims to inform policymakers, development agencies, and researchers about the conditions under which climate finance can effectively contribute to emission reduction. He expressed hope that students and faculty at Makerere University would further engage with the study’s findings.

Prof. Purdon presenting the reserach findings. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Prof. Purdon presenting the reserach findings.

“This is how ideas turn into action – through forums like this,” he said, noting his appreciation for the strong turnout and engagement at the event.

Prof. Purdon was in Uganda to attend the International Growth Center (IGC) conference later in the week, but used the opportunity to share his latest work with the Makerere academic community.

Prof. Purdon concluding his presentation. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Prof. Purdon concluding his presentation.

Uganda to Launch National Climate Finance Strategy as Experts Call for Private Sector Investment in Adaptation

Uganda is set to launch its first-ever National Climate Finance Strategy on September 12, 2025, a milestone development in the country’s climate policy architecture, according to remarks made by Dr. Peter Babyenda, Policy Engagement Specialist at the EfD-Mak Centre.

Speaking on behalf of Prof. Edward Bbaale, Director of EfD-Mak Centre, Dr. Babyenda emphasized that climate finance will only be effective if private sector participation is prioritized especially in adaptation-focused investments.

“The private sector will only invest where there’s a return. We must ask how to make climate investments profitable,” Dr. Babyenda said. “Much of our climate financing currently goes toward mitigation, but Uganda’s needs are more aligned with adaptation especially in agriculture, which remains highly vulnerable.”

Dr. Peter Babyenda representing the centre Director during the seminar. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Dr. Peter Babyenda representing the centre Director during the seminar.

He cited his recent consultancy with the International Fund for Agricultural Development (IFAD), which explored strategies for increasing private sector investment in agricultural adaptation. The findings, expected to be published soon, were presented to various donor communities and could shape future financing models in Uganda.

Dr. Babyenda noted that while mitigation efforts like tree planting are easier to quantify and attract funding, adaptation remains underfunded despite its critical relevance for Uganda. He called for targeted strategies to shift this imbalance.

Highlighting the significance of Prof. Purdon’s new book, “The Political Economy of Climate Finance Effectiveness in Developing Countries”, Dr. Babyenda stressed the importance of understanding political will in determining the success of climate initiatives.

Participants attending the seminar in the EfD Conference room. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Participants attending the seminar in the EfD Conference room.

“The experiences from Uganda, Moldova, and Tanzania outlined in the book show that effectiveness is possible where there is political interest. It is not just about institutional capacity it is about commitment,” he said.

He further revealed that Uganda’s Ministry of Finance, Planning and Economic Development has already established a Climate Finance Unit, which is now leading efforts to formalize the upcoming strategy.

In addition to national developments, Dr. Babyenda warned of growing international pressure. He pointed to upcoming European Union regulations, including the Cross-Border Adjustment Mechanism (CBAM), which could restrict exports such as coffee unless exporters prove their products are deforestation-free.

Some of the students attending the seminar. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Some of the students attending the seminar.

“If we don’t have systems like carbon taxes or certified credits, our goods will face fines or lose market access. We must prepare for this global shift,” he warned.

Dr. Babyenda also announced that Makerere and IGC would sign a Memorandum of Understanding, solidifying their continued partnership in climate economics research and policy development.

He closed by encouraging students to engage with the issues raised during the seminar, suggesting they could form the basis of graduate research or postdoctoral work, especially with available funding in climate-related fields.

Peter Babyenda organised the seminar. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Peter Babyenda organised the seminar.

“Monies are there and these are the issues. Our roads, our crops, our lives are being affected. We need solutions rooted in evidence and action,” he said.

Book Offers Critical Insights for Evidence-Based Policy, Says Reviewer Dr. Byakagaba

Dr. Patrick Byakagaba, a leading Ugandan environmental policy expert and one of the reviewers of the launched book, praised the publication for shedding light on the political economy factors that determine the success or failure of climate finance instruments in developing countries.

Dr. Byakagaba described the work as a timely and evidence-based resource that should inform both policy and practice.

“In my opinion, this book helps us understand the political economy factors that are critical for the effectiveness of the different climate financing instruments,” Dr. Byakagaba said. “It shows what is working, what is not, and what we must do to leverage successful measures.”

Byakagaba welcomes Purdon to present. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Byakagaba welcomes Purdon to present.

He emphasized the book’s relevance not only for academics but also for practitioners and students in economics, environmental science, and natural resource management – many of whom are directly involved in projects funded by international climate finance.

Unlike many theoretical publications, Dr. Byakagaba noted that the book stands out for its field-based evidence drawn from Uganda, Tanzania, and Moldova – countries with shared democratic governance structures but differing levels of engagement in climate finance initiatives.

“This isn’t just theoretical work,” he said. “It gives us a strong theoretical foundation but also backs it up with real-world evidence. That’s exactly what we’ve been missing – research that informs policy in a tangible, practical way.”

Dr. Patrick Byakagaba speaking during the seminar. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Dr. Patrick Byakagaba speaking during the seminar.

He stressed the importance of building on this research to expand the body of evidence needed for crafting effective and locally relevant climate finance strategies.

“If we are going to adopt evidence-based policy instruments, we must continue investing in research that reveals what’s actually working on the ground,” Dr. Byakagaba urged.

The seminar highlighted the growing need to critically evaluate and adapt international climate finance mechanisms to local political and economic realities – a message echoed by both Prof. Purdon and other experts at the event.

Prof. Purdon, Dr. Patrick Byakagaba and a student interact after the seminar. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Prof. Purdon, Dr. Patrick Byakagaba and a student interact after the seminar.

Book summary

There is ample evidence that engaging developing countries on climate change mitigation would have significant, positive impacts on global climate efforts. There is much debate, however, on the most effective strategy for unlocking these low cost mitigation opportunities. While the Clean Development Mechanism (CDM) emerged as the main climate finance instrument for engaging developing countries under the Kyoto Protocol, the carbon market approach it embodied would largely be replaced by a new array of climate finance instruments based on climate funds.

In The Political Economy of Climate Finance Effectiveness in Developing Countries, Mark Purdon shows that the effectiveness of climate finance instruments to reduce emissions under either strategy has depended on the interaction between prevailing ideas about how to develop a nation’s economy, as well as state interests in various economic sectors.

Prof. Purdon (R) during the discussion session. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Prof. Purdon (R) during the discussion session.

Based on multiple field visits over a decade in three countries, the author demonstrates that climate finance instruments have been more effectively implemented when the state treats them as vehicles for addressing priority development issues. Climate finance instruments were more consistently and effectively implemented in Uganda and Moldova than Tanzania, despite differences in state capacity between countries. This pattern held for the CDM,as well as subsequent instruments largely based on climate funds such as Reducing Emissions from Deforestation and Forest Degradation (REDD+) and other national mitigation actions. Contributing to broader debates on international climate cooperation, Purdon’s findings inform international efforts to support national climate plans and catalyze low-carbon development by emphasizing the importance of domestic politics and the state.

Some of the students attending the seminar. Prof. Mark Purdon seminar and launch of his new book "The Political Economy of Climate Finance Effectiveness in Developing Countries: Carbon Markets, Climate Funds, and the State" hosted by the Environment for Development (EfD) Makerere Centre, 27th August 2025, Yusuf Lule Central Teaching Facility, Makerere University, Kampala Uganda, East Africa.
Some of the students attending the seminar.

The Political Economy of Climate Finance Effectiveness in Developing Countries:  Carbon Markets, Climate Funds, and the State

By Mark Purdon

Oxford University Press 2024

Purchase Online: https://global.oup.com/academic/product/the-political-economy-of-climate-finance-effectiveness-in-developing-countries-9780197756836

Jane Anyango is the Communication Officer EfD Uganda.

Jane Anyango

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Business & Management

Makerere PIM Centre, MoFPED Train Second Cohort on Revised Guidelines for Financial Clearance

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Front Row: Prof. Edward Bbaale (2nd Right), Mr. Paul Mwanja (Centre) and Dr. John Seruyange (Left) with trainers and participants on 25th August 2025. Ministry of Finance, Planning and Economic Development (MoFPED), in partnership with the Public Investment Management Centre of Excellence (PIM CoE), Makerere University, Kampala, two-week capacity-building training on the Revised Guidelines for Financial Clearance, August 25 to September 5 2025, Pearl on the Nile Hotel, Jinja, Uganda, East Africa.

Jinja, | August 25, 2025

The Ministry of Finance, Planning and Economic Development (MoFPED), in partnership with the Public Investment Management Centre of Excellence (PIM CoE) at Makerere University, has launched a two-week capacity-building training on the Revised Guidelines for Financial Clearance. The training, running from August 25 to September 5, 2025 at Pearl on the Nile Hotel in Jinja, is equipping government officials with critical skills to strengthen fiscal governance and evidence-based policymaking.

Mr. Paul Mwanja. Ministry of Finance, Planning and Economic Development (MoFPED), in partnership with the Public Investment Management Centre of Excellence (PIM CoE), Makerere University, Kampala, two-week capacity-building training on the Revised Guidelines for Financial Clearance, August 25 to September 5 2025, Pearl on the Nile Hotel, Jinja, Uganda, East Africa.
Mr. Paul Mwanja.

In his opening remarks, the Permanent Secretary/Secretary to the Treasury (PS/ST), represented by Commissioner Infrastructure & Social Services Department, Mr. Paul Mwanja, emphasized that the Certificate of Financial Implications (CFI) is more than a procedural step in policy formulation. “It is a vital instrument to ensure that all policy and legislative proposals submitted to Cabinet or Parliament do not undermine Government’s fiscal policy objectives and are aligned to the Development Agenda,” he noted.

Some of the participants. Ministry of Finance, Planning and Economic Development (MoFPED), in partnership with the Public Investment Management Centre of Excellence (PIM CoE), Makerere University, Kampala, two-week capacity-building training on the Revised Guidelines for Financial Clearance, August 25 to September 5 2025, Pearl on the Nile Hotel, Jinja, Uganda, East Africa.
Some of the participants.

The revised CFI Guidelines, which took effect on July 1, 2025, introduce a stronger institutional and analytical framework for financial clearance. They require Ministries, Departments, and Agencies (MDAs) to demonstrate compliance through:

  • Undertaking and securing approval of a Regulatory Impact Assessment (RIA) by the Office of the President.
  • Submitting a Statement of Financial Implications (SFI) to MoFPED.
  • Conducting consultations within MDAs and Policy Working Groups (PWGs).
  • Supporting MoFPED in undertaking an Integrated Regulatory Cost-Benefit Analysis (IRCBA).
Mr. Simon Kizito, Deputy University Secretary, Makerere University. Ministry of Finance, Planning and Economic Development (MoFPED), in partnership with the Public Investment Management Centre of Excellence (PIM CoE), Makerere University, Kampala, two-week capacity-building training on the Revised Guidelines for Financial Clearance, August 25 to September 5 2025, Pearl on the Nile Hotel, Jinja, Uganda, East Africa.
Mr. Simon Kizito, Deputy University Secretary, Makerere University.

According to the PS/ST, these reforms are designed to enhance inter-agency coordination, improve the efficiency and quality of financial clearance, and ensure that public resources deliver maximum value to citizens. “The success of these reforms rests not only on the strength of the guidelines, but also on the competence and commitment of those who implement them. That is why this training is so crucial,” he stressed.

Prof. Edward Bbaale. Ministry of Finance, Planning and Economic Development (MoFPED), in partnership with the Public Investment Management Centre of Excellence (PIM CoE), Makerere University, Kampala, two-week capacity-building training on the Revised Guidelines for Financial Clearance, August 25 to September 5 2025, Pearl on the Nile Hotel, Jinja, Uganda, East Africa.
Prof. Edward Bbaale.

Welcoming participants, Prof. Edward Bbaale, Director of the PIM Centre of Excellence, commended MoFPED’s continued support and the nomination of participants from various MDAs. He described the workshop as timely, coming shortly after the dissemination of the revised CFI Guidelines in June 2025. “These guidelines require robust and evidence-based SFIs before policy proposals and bills can proceed. This workshop will therefore strengthen your ability to prepare such SFIs through the lens of Integrated Regulatory Cost-Benefit Analysis,” Prof. Bbaale said.

Over the two weeks, participants will gain practical skills in:

  • Risk analysis to assess uncertainties in policy implementation.
  • Cost-effectiveness analysis to compare alternative interventions.
  • Developing input-output and financial/economic models.
  • Integrating macroeconomic parameters in policy evaluation.
  • Preparing Statements of Financial Implications that inspire confidence in decision-making.
A female participant. Ministry of Finance, Planning and Economic Development (MoFPED), in partnership with the Public Investment Management Centre of Excellence (PIM CoE), Makerere University, Kampala, two-week capacity-building training on the Revised Guidelines for Financial Clearance, August 25 to September 5 2025, Pearl on the Nile Hotel, Jinja, Uganda, East Africa.

The training also builds on the PIM CoE’s broader mandate of research, outreach, and advisory services. The Centre has previously revised the Development Committee guidelines, assessed project performance since NDP I, and hosted the second Public Investment Management Conference earlier this month focusing on implementation challenges in public investment. Both MoFPED and Makerere University reaffirmed their commitment to continuous capacity building to ensure that Uganda’s public finance architecture remains responsive, efficient, and aligned with long-term national development aspirations.

Betty Kyakuwa
Betty Kyakuwa

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