All multinationals must sell shares, top executives say

Kampala. Top executives and economic actors across the divide have said the President’s move to make it mandatory for all telecoms to sell shares to Ugandans should apply to all multinationals.
However, some of them insisted the move was so late, given that government has since adopting the privatisation policy in 1994 insisted that Uganda was a liberalised economy that allows foreign companies to repatriate 100 per cent of their profits.
Reacting to the President’s pronouncement insisting that MTN must float shares on the stock exchange, Mr Patrick Bitature, the Private Sector Foundation Uganda chairman, said mandatory listing should apply to all multinationals such as beverage companies.
This, he said, will allow Ugandans to share into their wealth as well as make them appreciate why they must support such companies.
“I think this [listing] should be the case with all big companies that repatriate 100 per cent of their profits. Yes, they pay taxes but citizens must have local ownership for them to feel they are part of the company which they support,” he said.
In a series of tweets, President Museveni said MTN must allow Ugandans to buy into the telecom to mitigate capital flight.
“Local ownership is important because it helps us stem capital flight which happens when the company is fully foreign-owned. The question of repatriating 100 [per cent] profits yet there is little value-addition and wealth creation for Ugandans is unfair,” the President said indicating that he had brought this to the attention of the MTN Group chief executive officer, Mr Rob Shuter on the sidelines of the World Economic Forum in Davos, Switzerland.

Mandatory listing for telecoms
Mandatory local listing for all telecoms is outlined in the National Broadband Policy that Cabinet endorsed in September 2018.
The policy requires telecoms to open up to local ownership through private placement, public offering and listing by introduction.
This, according to government, will among others, increase tax collection due to improved transparency, reduce pressure on the shilling as well as help growth of stock markets.
Currently, the USE has only 17 listed companies, eight of which are cross-listings from Kenya.
Mr Everest Kayondo, the Kampala City Traders Association chairman, wondered how a government with economic advisors would allow such gross repatriation of profits to go on for this long. He said this was a good pronouncement that should have happened as soon as government adopted privatisation.
“Sometimes I don’t know if we have economic advisors. This is something we have been saying since 2012. We told the President you have a problem. Multinationals own 100 per cent of their companies and repatriate 100 per cent of their profits,” he said that they had told the President this was not feasible.
He said, the move should apply to all multinationals, suggesting that they should at least sell 30 per cent shareholding to Ugandans.
Last year, Mr Charles Mbire, the MTN Uganda chairman, told Daily Monitor they had been considering government’s proposal and would after studying it see how to harmonise with the new demand.
However, he said the process would be carefully done to avoid rewarding ‘thieves’ that would “bring in stolen money to contaminate the company”.
“I think we should reward people [by selling shares] who have toiled for their money. I am talking about people in pension funds, nurses and teachers whose sources of money I trust,” he said, noting that if the process is not carefully done, “you will end up getting stolen money” to buy into the telecom.