US govt warns businesses against investing in Uganda
This follows the World Bank’s suspension of new funding in Uganda due to the passing of the anti-gay law. The bank said that it will resume funding once the Ugandan government has made efforts to ensure that LGBTQ+ people are not marginalized in the programs it funds.
The Departments of State, Labor, Health and Human Services, Commerce, and the U.S. Agency for International Development have warned its nationals of potential risks they may face if they are conducting, or contemplating to conduct, business in Uganda.
This follows the World Bank’s suspension of new funding in Uganda due to the passing of the anti-gay law. The bank said that it will resume funding once the Ugandan government has made efforts to ensure that LGBTQ+ people are not marginalized in the programs it funds.
According to a business advisory released on Monday, October 23, 2023, there are risks associated with interference in and intimidation of the judiciary, use of influence in the courts to resolve political disputes, and co-opted security forces.
“Inconsistently implemented legislation, rent-seeking from officials, and intrusive government security and surveillance likewise can adversely impact the ability of U.S. businesses and individuals to operate. These actions may become more frequent in the lead up to the 2026 elections; similar patterns of violence and disregard for the rule of law occurred ahead of the 2021 and 2016 electoral processes,” it says.
Additionally, the advisory notes that the enactment of the AHA expands these risks and creates additional opportunities for interference with business operations as it, among other things, mandates reporting of individuals suspected of homosexual behavior, imposes a life sentence for consensual same sex relations, and allows for a 20-year prison sentence for mere “promotion” of homosexuality, which is defined so broadly as to potentially cover a wide range of activities
The multi department advisory also notes that several goods imported from Uganda into the United States have also been tied to labor abuses, including those produced by child labor.
“The AHA encourages actions that may lead to further isolation and create additional barriers to education access for children identifying as LGBTQI+, which may increase their risk of dropping out of school and engaging in child labor. “
Heightened Risks for Media, Broadcasting, Advertising, and Related Industries
The advisory notes that security forces subject journalists and media houses to violence and harassment.
“Meanwhile government officials have directly and indirectly censored media through intimidation and other means. The AHA potentially increases these censorship risks by criminalizing a wide range of commercial activities that are of particular interest to media, broadcasters, the advertising industry, and related industries. In addition, the AHA is not explicitly limited to activity occurring inside Uganda, so broadcasters, streaming services and internet advertisers may face risks to their business in Uganda arising from activities outside of Uganda,”
Potential for Conflicting Obligations
Additionally, the advisory warned businesses and individuals that they may face potentially conflicting obligations under Ugandan law.
“For example, U.S. law prohibits discrimination based on sexual orientation and gender identity in federal contracting under Executive Order 11246 and its implementing regulations. Employees of federal contractors performing work outside the United States are covered by these protections if they were recruited within the United States. Accordingly, if employees recruited within the United States are or will be performing work on federal contracts in Uganda, federal contracting agencies must include sexual orientation and gender identity as prohibited bases of discrimination in the Equal Opportunity Clause in contracts over $10,000,” reads an excerpt.
