The paper is one of a series of research papers that are designed to timely disseminate research and policy analytical outputs generated by the USAID funded Feed the Future Innovation Lab for Food Security Policy (FSP) and its Associate Awards. The FSP project is managed by the Food Security Group of the Department of Agricultural, Food, and Resource Economics at Michigan State University (MSU), and implemented in partnership with the International Food Policy Research Institute (IFPRI) and the University of Pretoria (UP).
As a key pillar of the Ugandan economy, the agriculture sector is a critical driver of economic growth and poverty alleviation. Uganda's agricultural sector is dominated by smallholders with low levels of productivity. The agriculture sector is highly exposed to co-variant risks, which include weather, biological, infrastructure (post-harvest loss), price, and market risks. This plethora of risks suppresses appetite for investment in the sector. Despite the sector's contribution to the economy, farmers' access to finance remains a major constraint.