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30 years of economic recovery; but to whose benefit?

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30 years of economic recovery; but to whose benefit?

Getting the economy work for a big majority of Ugandans is the main unfinished business for our liberators!

Chief Liberator President Yoweri Museveni

Chief Liberator President Yoweri Museveni

Mr. President, as has been the case in the past.”

Thirty years later, it would require a Professor of Propaganda to convince the majority of Ugandans that they have benefited from NRM’s “fundamental economic changes.” Although it may not be debatable that in the last 30 years Uganda’s economy has undergone substantial progress, as far as Gross Domestic Product (GDP) growth and tax collection are concerned, the problem is that the fruits of this progress have served the interests of a small minority.

True, during the last 30 years, Uganda’s economic statistics have suggested NRM has turned around the economy. GDP at current prices has increased from below $4 billion (Shs.12 trillion) to $27 billion (Shs.85 trillion) today, growing at an average annual rate of 7% for much of the last 30 years.

That is one side of our realities. The other side is that this GDP is in the hands of very few Ugandans. True, beautiful houses and buildings have sprung up in Kampala and its suburbs. Urban centres like Mbarara, Masaka, Mukono, Arua, and other district peri-urban townships have undergone serious reconstruction. But a few miles outside each of these bungalow-infested centres, poverty can be seen everywhere, and in some areas like Pader, Pallisa, Kyenjojo, and even rural Luwero (the theatre of the liberation war) and other rural areas, poverty is visible by naked eyes! So for Ugandans living in these areas, and they are the masses, the economy has not shone brightly at all.

Self-enrichment of NRM cadres

Getting the economy work for a big majority of Ugandans is actually the main unfinished business for our bush-war heroes. The other grievances — over stay, political manipulations, police harassment etc — are secondary. Economic inclusion is all Ugandans are yearning for. And economic inclusion is often a policy issue. It’s a choice that the policymakers have to decide to pursue. Leaving the economy at the mercy of the market is not smart at all.

I have, in several of my articles in these pages, been repeatedly asking you, Mr President, whether you are not equally perplexed by this economic paradox — economic growth that is not translated into real poverty reduction (beyond the hollow headcount ratio statistics) and improvement of the quality of life of ordinary people in Uganda. I am not repeating the same questions.

Today, I am asking different though related questions. Did some of you NRM leaders fight for self-enrichment? I have on several occasions heard you Mr. President flying your own kite, telling us how rich you are. But we know you were not rich prior to your ascendance to power. You often explain how you’ve made your money from agriculture. Well, we have also tried to practice commercial farming but the environment for the sector has not been conducive for millions of farmers. What magic did you use to flourish in a sector that has for years been impeded by a myriad of factors — low productivity, high post-harvest losses, low growth, poor technology and infrastructure etc?

The answer lies in the public incentives towards the agricultural sector. These incentives have been offered in a biased way; going to a selected few. That’s why those of you who got the incentives are now super-rich sleeping in houses fit to be hotels, while the masses are still sleeping in grass.

Many Ugandans today feel that some of their beloved heroes of ’86, and thereafter, have become more parasitic than the benevolent dictators they succeeded. They have perfected the art of embezzling state funds with impunity, knowing that as long as you exhibit unquestionable loyalty before Mzee, you can always laugh to the bank. This is not a metaphor, Mr President: your government has increasingly become less accountable to Ugandans. Ugandans are wondering whether progress in NRM’s vocabulary means self-enrichment of NRM cadres.

A country of excesses

It is Bank of Uganda Governor, Emmanuel Mutebire, who once said, “Let those who have eyes to see where money is amass it.” What about those without the “eyes”? Indeed this is the Uganda that NRM has been building; a country where those who are on the right side of the “sperm lottery” (the luck of being born with good genes or with rich parents) or those in positions that give them access to ’embezzlable’ state funds are getting rich as the masses continue to languish in abject poverty.

This is the very reason, Mr. President you are sweating to find what to tell people at campaign rallies. On Tuesday I watched you on TV trying so hard to find what to tell Ugandans at the 30th anniversary of your struggle. I saw you struggling to ward off the old men and women whom you were decorating with medals but wanted to engage you in an open principal-agent conversation! These and other ugly scenes are a sign that the economy is not working for very many Ugandans including majority of the Luwero veterans.

Mr President, I am one person who hates lamenters but NRM has turned me into one. Whenever I go to Butambala and find my Moslem brothers (sons of former business gurus) playing Omweso at 9am; when I see female university graduates working as waitresses in Kampala bars; when I see my cousin living just here in Mukono being fleeced by middlemen, buying his watermelon fruits at Shs.500 each yet they sell the melons to me in Kampala at Shs.8000, I can’t avoid picking the pen to lament.

It is such images that often remind me the poise with which you concluded your first NRM anniversary speech twenty-nine years ago “We fought a hard war against Obote, we are going to fight economic stagnation – and we shall win.” I can’t doubt that while saying this you were assuring all Ugandans, but I doubt whether you are proud of your performance particularly on the economic front.

In the 30 years, you have presided over a country of excesses; excessive economic liberalism, excessive population growth, excessive corruption, excessive politics, excessive environmental degradation, etc.

Redefine the “Steady Progress”

Your government, Mr. President, has allowed so much rent seeking of all forms — corruption, regressive taxation, predatory financial intermediation — which have turned Uganda into a country of the haves and have-nots. Most of the haves are closing the escape routes for the have-nots, using their political and business positions. And many people are dissatisfied with this.

This calls for you, Mr President, to properly redefine the “Steady Progress”. You need to tame the rent seekers whose main preoccupation is to block all the escape routes for those who are still in captivity, you need to become clearer on the fight against corruption, you must regulate the economy and rid it of the visible market failures that are impeding its proper functioning.

To get the economy to work for the majority of Ugandans, you will have to make agriculture a high value sector by raising its productivity, reducing post-harvest losses, regulating the agricultural markets to make the farm-gate prices stable and high enough, and by reducing subsistence production. Then you will need to facilitate structural transformation of the economy to create more decent jobs for the young people who are leaving university.

I have heard you, Mr. President, condemning the young people for having chosen the ‘wrong’ courses at university. This is escapism; there is nothing like wrong education. It’s your government’s failure to provide the right incentives that would guide the young people and their parents when taking the decision to pursue higher education. And these young people are trainable even with their ‘wrong’ degrees.

 

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Ramathan Ggoobi

Ramathan Ggoobi is Policy Analyst, and Researcher. He lecturers economics at Makerere University Business School (MUBS) and has co-authored several studies on Uganda's economy. For the past ten years, he has published a weekly column 'Are You Listening Mr. President' in The Sunrise Newspaper, Uganda's Leading Weekly

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