Government must invest strategically, implement local content policy

An oil refinery. COURTESY PHOTO

What you need to know:

  • Being on record that there is no country in Africa that has ever succeeded and benefited in oil refinery projects, producing oil raises more concerns among many Ugandans.
  • As we recall that every fund that Uganda borrows does not bring in a return or benefit to poor Ugandans in the long-run other than increasing debts that will be paid by our grand and grandchildren.
  • The government can also collect more tax when its citizens are employed and earn income.

Last week, Uganda signed $4 billion refinery plant deal. The financing agreement sets the stage for oil production by 2020 when the facility becomes operational, which is also going to be a borrowed fund for the construction of the project.
Being on record that there is no country in Africa that has ever succeeded and benefited in oil refinery projects, producing oil raises more concerns among many Ugandans.

The $4 billion refinery project comes after the projected $4 billion for the construction of 1,4415-kilometer pipeline and the $309 million for the construction of Kabale international Airport, Moreover, all these funds are also borrowed even with the external and domestic debt burden standing at $11.2 billion, Uganda is still borrowing more to construct roads and hydropower dams.

When you do the mathematics, it means that Uganda’s debt will be exceeding 50 per cent of her GDP, which is very dangerous and against our Constitution.
As we recall that every fund that Uganda borrows does not bring in a return or benefit to poor Ugandans in the long-run other than increasing debts that will be paid by our grand and grandchildren.

Thereafter, as Uganda continues to borrow for infrastructure development, which is a very good thing, still let us also invest strategically and also promote local content in each and every project that government undertakes other than designing bad agreements where everything, including raw materials, labour, etc, comes from abroad.

Yet a well implemented local content policy in Uganda would help to create jobs for Ugandans hence improve income hence improve their standard of living. The government can also collect more tax when its citizens are employed and earn income.