MATIP II - Markets and Trade Improvement Project Phase II


  • Reference: P-UG-AAZ-002
  • Approval date: 10/12/2014
  • Start date: 02/10/2015
  • Appraisal Date: 31/03/2014
  • Status: OngoingOnGo
  • Location: COUNTRYWIDE


MATIP-2 will be implemented along MATIP-1 conceptual framework, with an addition of a value addition component. The project comprises of 3 major components namely:

(i) Market Infrastructure Development,

(ii) Value Addition and Trade Facilitation (including Capacity Building); and

(iii) Project Management and Coordination.

Component 1: Market Infrastructure Development

In all the proposed sites, modern market structures are proposed in place of existing dilapidated ones which includes construction of lockups for general merchandise, agricultural warehouse and wholesale facilities; restaurants; stalls with lockers for food stuffs, groceries, clothes/shoes; stalls for fish (fresh) and meat with water points, lockers, an enclosed area with trap doors and netted windows, together with cold storage rooms and fish dressing rooms; space for private service providers such as Banks/microfinance institutions, clinics/pharmacies, and day-care centres etc.

These modern markets also include service such as: (a) Access and Grounds - paved distributor and access roads (where necessary), public parking/off loading and loading areas, and enhanced landscaping within the market place. (b) Health/Safety and Environmental - a system of fire hydrant points, fire-fighting water points supplied from an overhead tank, fire extinguishers, water supply and a solid and liquid waste disposal systems; and (c) Electricity Supply - a system of mains and distribution lines which include power, lighting, emergency and standby power, compound lighting, ICT, etc.

Component 2: Value Addition and Trade Facilitation

This component will render services to the markets and will consist of the following sub-components:

"Provision of first level value addition equipment for cleaning, grading/sorting and de-stoning. The project will also support the establishment of quality control, grading and standardization systems which are a precondition for credible and transparent markets, "Provision of high level processing like grain mills in locations of high grain production and trade, "Linkage of produce to agro-processing facilities in the sister Community Agriculture Infrastructure Improvement Programme (CAIIP), located in production areas within the reach of these markets. The project will assess and identify vital market opportunities and product niches along the stages of the value chain, and; "Use of market information system to inform vendors on commodity prices in various locations. "Capacity development for agro-processors, value chain operators, and Vendors business development and quality control.

Component 3: Project Management

The Project will be implemented through an existing Project Facilitation Team (PFT) in the Ministry of Local Government. The PFT is already implementing a number of Bank-funded Projects, including CAIIP-1, CAIIP-2, MATIP-1, and CAIIP-3, all of which are financed by the Bank. It should be noted that CAIIP-1 and CAIIP-2 will close by end of 2014 just before activities of MATIP-2 commence while MATIP-1 will close in September 2015. The Head of the PFT will be the overall coordinator of the Project assisted by the current staff contingent. The PFT will ensure that Project activities are initiated and are adequately budgeted for, consolidate Project records, submit all procurement documents to the Bank for review and approval; compile and submit all disbursement applications and quarterly progress reports; undertake annual audits of all Project accounts and submit the audit reports to the Bank. Implementation of Project activities at the Municipal/Town Council level will be carried out through the established structures under the office of the Town Clerk with guidance of the PFT. Each Municipal/Town Council will designate a Project Support Officer (PSO) among its staff, who will coordinate implementation and technical supervision of the Project, including sensitization of vendors, training, and monitoring and evaluation in the respective local governments.


The overall sector goal of MATIP is to contribute to poverty reduction and economic growth in Uganda through enhanced marketing of agricultural produce. The specific objective is to improve market place economic and social infrastructure; thus inducing incremental production and marketing of agricultural commodities, enhancing the incomes of vendors and increasing employment opportunities.


The project concept was borne from the realization by the Government through various national fora of the poor state of the markets across the country. This was further confirmed by the results of the Feasibility Study that was commissioned by the Government to assess the state of the markets and propose the best approach to address the underlying problems. The Feasibility Study classified the challenges facing the markets into six broad categories, namely; planning, environmental, infrastructural, legal and institutional, capacity building, finance and socio-economic. The specific constraints include;

(i) Old dilapidated and inadequate infrastructure (lockups and stalls and associated buildings) and are unable to meet the present day requirements;

(ii) Inappropriately planned and constructed temporary structures common in all the markets, which are mostly located in city/urban councils;

(iii) Inadequate space to accommodate the ever increasing numbers of vendors;

(iv) Poor sanitation and drainage systems;

(v) Lack of adequate water, electricity supply, and parking, loading and offloading areas;

(vi) Inadequate capacities (financial, logistical and human resources) to repair and maintain existing markets structures; (vii) Due to the rapid growth of towns, general lack of land for development and expansion.

The project seeks to improve the working conditions in the markets by providing adequate infrastructure services and amenities, value addition facilities, creating employment opportunities and installing a proper environmental management system. The constructed/rehabilitated markets will become centres of commercial interchange and social interactions, and growth points around which other private enterprises will emerge. Additionally, the improved markets will create more marketing opportunities for smallholder producers of agricultural commodities to sell their produce at competitive prices, thereby benefitting consumers. Furthermore, it will create trade links with potential traders both within and across the borders for more value addition and commercial exchange. Markets are a very important element of the supportive infrastructure that must be in place for a successful agricultural sector as it provides a quick and convenient outlet for agricultural produce. The project's multiplier effect especially on rural farming communities, will lead to increases in income and poverty reduction.

The project will also reduce poverty in the urban setting as markets provide formal and informal employment opportunities through trade and entrepreneurship. In an environment where industrial and service jobs markets are limited, market retailing is considered to be among the most amenable alternatives for that segment of the urban population that has limited or no skills and very limited capital.


Targeted Beneficiaries: The estimated number of direct beneficiaries under the proposed project is 19,519 vendors with over 10,000 being women, while 2,000 shall be the youth. In addition, about 200,000 households will indirectly benefit from the project throughout the value chains. The project is expected to create at least 1,000 fulltime jobs in processing and trade.

Targeted Areas: The proposed Project (MATIP-2) will cover 14 main markets in 8 Municipalities (i.e. Kabale, Mbarara, Masaka, Kasese, Arua, Soroti, Busia, and Entebbe), 4 Town Councils (i.e. Moroto, Kitgum, Tororo, and Lugazi), and Kampala Capital City Authority (Nakulabye and Ntinda). The main criteria for the selection of these Districts include

(i) nearness to international borders,

(ii) volume of agricultural produce traded,

(iii) poverty, food insecurity and malnutrition prevalence,

(iv) potential for growth and to respond to development interventions,

(v) potential to promote diversification of produce use,

(vi) readiness of the municipalities and facilitation of logistics in project implementation, and (vii) availability of un-encumbered land for the market structures.

The project is focused on advancing Government's diversification agenda to broaden the farm income, agricultural trade and food base for smallholder producers. The project will therefore focus on promoting efficiency in production, processing and marketing of agricultural produce.

Key contacts

IHEDIOHA Onyema Damian - OSAN1


Finance source Amount
ADBUSD 57,799,500
GovernmentUSD 6,541,915
DeltaUSD 457
TotalUSD 64,340,959