Uganda, Japan to strengthen microfinance and climate financing

Uganda’s State Minister for Microfinance, Hon. S. Musherure, has held talks with a high-level Japanese delegation to explore avenues for strengthening bilateral cooperation, with particular focus on microfinance, financial inclusion, youth enterprise and climate-related financing.

The Japanese side was led by Ms. Takahashi Misako, Director General and Assistant Minister for African Affairs, and included H.E. Sasayama Takuya, Ambassador of Japan to Uganda, along with other officials.

Minister Musherure welcomed the sustained partnership between the two countries and acknowledged Japan’s continued support in key sectors including health, education and the welfare of refugees. She specifically highlighted the instrumental role of the Japan International Cooperation Agency (JICA) in supporting major national infrastructure projects.

At the centre of the discussions was Uganda’s Parish Development Model (PDM). The Minister reported that the programme has so far reached 3,783,108 beneficiaries, with the Government capitalising the Parish Revolving Fund to the tune of approximately Shs 4.317 trillion across 10,589 PDM SACCOs nationwide.

“The programme is therefore no longer simply a small loan initiative. It is becoming an important platform for bringing millions of Ugandans into the formal financial and productive economy,” Musherure said.

She noted that Uganda’s National Financial Inclusion Strategy II (2023–2028) prioritises physical and digital access, digital financial services, consumer protection, financial literacy and inclusive green finance. These priorities are being advanced at scale through the PDM, the Emyooga programme and private-sector initiatives.

“Uganda does not only view microfinance simply as the provision of loans but wants to build a sustainable financial ecosystem in which ordinary Ugandans can save, access affordable credit, invest, insure themselves and manage risks to grow their businesses,” the Minister emphasised. “We see an opportunity to combine Uganda’s scale and development priorities with Japanese technology, knowledge and investment.”

Discussions also focused on strengthening SACCOs and community-based finance through digitalisation of operations, the development of sustainable savings products, improved internal controls, financial management and the training of managers and leaders, drawing on Japan’s long experience with cooperative institutions.

A proposal for a Uganda–Japan Youth Enterprise and Innovation Facility was presented, combining enterprise financing, technical and business skills development and digital technology. JICA has already supported Uganda’s start-up ecosystem, with ten Ugandan start-ups from seven industries participating in an acceleration programme.

Green and climate finance for micro-enterprises featured prominently, with particular interest in solar energy solutions for rural businesses, solar irrigation systems and clean cooking technologies.

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On the Japanese side, Ms. Takahashi outlined Japan’s current approach to Africa and Uganda under three strategic pillars: realising Africa as a continent of peace; creating a virtuous cycle of growth between Africa and Japan; and building, through co-creation with the next generation, a society in which everyone can experience prosperity.

“We believe that these three pillars of Japan’s diplomacy towards Africa, as presented by Minister Motegi, are highly relevant to Japan–Uganda relations,” she said.

Ms. Takahashi affirmed Japan’s desire to promote mutually beneficial cooperation with Uganda across a wide range of areas, including the economy and investment, supply chains and logistics, regional connectivity, human resource development, science, technology and innovation.

She also indicated Japan’s interest in continuing dialogue with Uganda on the natural resources sector, including critical minerals, with a view to identifying possible areas of collaboration.