Foreign civil engineering firms and Uganda’s investment policy: a case study of Chongqing International Construction Corporation (CICO)

Abstract

This study explores the relationship between foreign civil engineering firms and Uganda’s investment policy, focusing on Chongqing International Construction Corporation (CICO) as a case study. It investigates the dynamics of Foreign Direct Investment (FDI) in Uganda’s infrastructure development, assesses the effectiveness of the National Investment Policy in regulating FDI, and identifies the primary actors shaping FDI trends in the country. The research adopts a qualitative approach, the study relies on both primary and secondary data. Primary data was collected through interviews with key stakeholders, including government officials, representatives of CICO, and other relevant actors in Uganda’s investment and infrastructure sectors. Secondary data was drawn from government reports, policy documents, and existing literature on foreign direct investment and infrastructure development in Uganda. Anchored in the theoretical frameworks of economic mercantilism and economic liberalism, the study highlights the dual nature of FDI as both an opportunity for economic growth and a challenge for regulatory governance. The first objective of this study is to identify recent trends in foreign direct investment and their implications on infrastructure development in Uganda. By exploring the specific contributions of firms such as CICO, the study assesses the extent to which foreign investments have contributed to the development of Uganda’s roads, energy, and urban infrastructure, which are critical for economic growth and poverty reduction. This section of the study provides an in-depth analysis of the benefits and challenges associated with foreign investments, including technology transfer, employment creation, and infrastructure development, as well as the challenges related to dependency on foreign firms and potential impacts on local industries. The second objective of the study is to assess the effectiveness of Uganda's National Investment Policy in regulating foreign direct investments. The analysis of policy effectiveness also highlights the gaps in the regulatory framework that may hinder Uganda from fully benefiting from foreign investments. The third objective focuses on identifying the main actors that shape foreign direct investment in Uganda. Foreign investments in Uganda are shaped by various local and international actors, including government agencies, international financial institutions, multinational corporations, and local businesses. This section explores the role of each actor in the investment process, their interests, and how their actions influence the flow of foreign capital into Uganda. The research concludes that while Uganda’s investment policy provides a framework for attracting FDI, it requires enhancements in regulatory mechanisms to ensure that foreign investments align with sustainable development objectives. Recommendations include strengthening policy enforcement, fostering partnerships with local firms, and addressing the broader implications of FDI on national economic sovereignty.