2009 - The year of the credit crunch

When the recession hit, most Ugandans thought they would not be affected. However, there were some whose lives took a different turn. Edgar Kangere speaks to two couples about how they were affected

For Sunna 32 and Jemimmah 28 (not real names), the credit crunch could not have been a more untimely event. They had just had their first child in two years of marriage when the crisis begun. Suuna, who had just received his CPA from Stanford University in the US, had landed himself a lucrative job with a big firm in Chicago and already in late plans to move his family to the states when disaster struck. Suuna’s employers filed for bankruptcy and he lost his job.
Although he had lived in USA for close to five years, he gambled all his life savings to finance his CPA and before he could say cheese, his moon crashed on his head.

“I was a foreigner in a country where jobs were being lost in thousands every week,” he narrates his story, “and as if that not enough, the bank where I kept my money also shut down.” “It was total chaos I tell you,” he continues. “I was jobless, penniless, had nowhere else to go and everywhere, things such as this were happening so fast.”
Visibly shaken by the memory, Jemimmah recollects how an almost sobbing Suuna had woken her from sleep to tell her he was coming back home. He had lost everything and there was nothing to do there. Their dream of moving to the US was dead.

“He did not even have enough money for the ticket back home,’’ she says. “He had to borrow from friends and it was very hard because everyone was hard up and no one was willing to let go of what little they had.”
With the help of a fundraiser on Facebook, Suuna’s friends in Germany, Canada, UK, Japan, and the US came through with enough money to fund his travel back home but back here, all was not Shangri-la for the returnee and his wife. He had nothing to support his young family. His wife, whose work required her to travel a lot, had left her job because she could not juggle long safaris and noveau motherhood so she too was out of work.

Luckily, the two of them being from business oriented families, were not left to starve but even for their families, there was a limit to which they could carry their burdens. Suuna tried everything he could to find work but no one seemed interested. With the situation getting more and more desperate, he started hanging around his uncles’ shops where he could at least take home something from odd labour.

Using his background as a CPA, he started helping his uncles sort out their accounting and soon made enough money to bring in his own merchandise to their containers whenever they imported and that is how his road to recovery begun. He secured stalls in different shops and together with his wife, run them while he continued to do accounts for his uncles and in a matter of months, they were back on their feet again.

They now have big plans to expand their business but when asked if he will ever go back to his hard earned profession as a CPA, Suuna laughs at the suggestion. Ben, 34 and Christine 33, have been married for over four years now. They live in their own home in Kiwatule with their three children; a four-year-old son, a two-year-old daughter and a six-month-old son.

They’ve been sweethearts for as far back as they can remember and when they got married, they were more than ready for life, but not for what was to hit them this year. Ben owns two companies; one a clearing and forwarding and another which offers marketing solutions to big corporations. Christine on the other hand works for Big Telecom; they both make good money and have a relatively comfortable life. According to Christine, “I did not even know what the credit crunch was.” She offers, “I mean, I heard of it everywhere but I am not big on news and international stuff so I never really bothered about it.”

“For me and the boys, it was just a debate we had over beer and pork,” says Ben. “We made jokes about it, made amateur analyses, empathised with those families we saw on the news that had lost everything, but it never really seemed real to us.”

With his face now deeply set in reflection, he recollects; “It was so unreal to us that when it started to be felt down here in Uganda, I brushed it off as a mere rough patch until I found myself cornered like a rat.” Things indeed were not easy. In the clearing and forwarding business, many clients either abruptly stopped importing, or their traffic was cut by half. In the marketing business, many of his clients are multi nationals and as soon the crunch hit, the first thing to suffer cuts was the marketing budgets. Being the eldest, he had to support his siblings, two of whom were at Makerere University, and to add to his pressure, his four-year-old-son was starting school. In order to survive, Ben had to stop all his building projects, throw his social life in the freezer and cut back on some of the spending at home.

In Christine’s department, the axe was falling too. Management claimed it was performance-related but everybody knew they were cutting back on spending. Her work load increased, finances at home were hard, and for the first time, her husband, who had always been in control, seemed not to know what to do. The next decision they made was a very difficult one. In order to keep afloat, they were going to have to draw on their retirement savings, which were tied in treasury bills and all sorts of securities. Although their family did not feel the pressure directly, Ben and Christine were countless times forced to make many a difficult decision to keep things normal.

Timothy, an economist, says the crunch was not as hard hitting in Uganda because ours is a cash economy and we should be thankful for that because it absorbed the worst of the crisis. It may be a while before the world suffers a slowdown of this magnitude but Timothy advises young couples to be prudent. “In these times of unstable economic climate, it is important for young couples to have more than one source of income to support their household expenses.” Timothy recommends that couples should have joint savings and operate small manageable businesses to alleviate financial pressure but the one thing they should always be ready for is an unplanned financial crisis.