Impact Of Internet Shutdown On Uganda's Economy

On the eve of Uganda's hotly contested Presidential election, the Uganda Communications Commission ordered a total internet shutdown, a move that caught many offside.

Before the 2016 General elections, social media access in Uganda was restricted, and users could access the sites over Virtual Private Networks (VPNs). Many Ugandans thought that would be the same case in 2021 when VPNs came into effect on Wednesday, 13th January, only for the whole country to go dark by 9 pm.

For the very many businesses that rely on the internet to survive, they began to count losses. There was scanty information on when restoration would be done, and the uncertainty alone caused a lot of panic.

“This puts our businesses in bad shape, and if the internet isn’t turned on soon, some businesses will be in a terrible situation,” says Rapa Thomson Ricky, the co-founder and director of taxi-hailing company Safe Boda.

In Kampala alone, Safe Boda brags of over 22,000 riders and can scale in upwards of a million rides. These rides, deliveries are only possible over the internet.

In the spirit of deliveries, eCommerce stores saw many orders ranging from food deliveries, parcels left in transit, with no way of tracing the claims. Hotels and restaurants ripping heavily from deliveries outside their premises also saw a sharp dive and complete shutdown of orders.

In 2016, UCC ordered the shutdown of popular social media channels and mobile money based transfers and transactions for four days, citing national security concerns, a directive that cost the economy $2 million, studies by internet rights scholars have indicated.

Uganda has more internet users than there were in 2016, and this shutdown was longer and on a larger scale. Over 12 million internet users in Uganda were in the darkness, which translates to a huge figure regarding lost revenue from telecom service package purchases, food orders and deliveries, and travels.

The effects of these internet shutdowns tend to spill to other countries as "outsiders" can't communicate with their colleagues because the latter are under a shutdown. Shutdown

impacts cross country trade and revenue.

Governments have been increasingly resorting to internet shutdowns as a means to limit online conversations and organizing. In 2018, Access Now tracked 196 internet shutdowns worldwide.

Top10VPN traced 18,225 hours of internet shutdowns worldwide in 2019, which carried a total economic cost of $8.05 billion.

In terms of individual regions, the Middle East and North Africa took the biggest economic hit from internet shutdowns in 2019, with costs exceeding $3 billion.

Sub-Saharan Africa followed suit, with costs of almost $2.2 billion, while Asia — the region with the most documented shutdown hours at 9,677 — had a blackout cost of $1.7 billion.