Why the war on graft is dead on arrival

Thursday December 13 2018

Karoli Ssemogerere

Karoli Ssemogerere 

By Karoli Ssemogerere

It is only the blind who can’t see that President Museveni is already well ahead campaigning for re-election in 2021. A few minor hiccups stand in the way. First is the tepid state of the economy, which is mild at best of time.

The International Monetary Fund (IMF) projects a burst in growth at 7.1 per cent pegged to an expected $20 billion in investment in the oil sector in the next three years. But these numbers are still grappling with reality. Uganda’s real oil crude oil/refining prospect is 60,000 barrels of oil a day or $2 billion per annum. Major players in the oil industry have delayed their oil investment decision by another one year or two.

Second is the rising debt servicing problem. Debt servicing in 2018/2019 is sharply up from mildly sustainable to mildly unsustainable. Now the real purpose of the public-private partnership law passed in 2013 is starting to emerge. The police negotiated away recently a fairly large portion of prime public land in exchange for Chinese construction of just two facilities, a headquarters building and a regional forensic lab.

Debt servicing (interest payable, principal repayments and roll-overs) is now more than 20 per cent of the Shs33 trillion budget and rising. This amount excludes the rising use of promissory notes which are not part of the official debt until they are issued repayment dates. In Kenya, this is already a problem that has required budget cuts to match international payments.

Third is the rising population. Uganda’s population is soon projected to hit 40 million, and double again in 30 years to 80 million in 2050. Most Ugandans, therefore, are expected to make the transition from rural to urban lives in the same period. Uganda still has just one city, Kampala, and a number of small towns that have failed to interconnect with the central economic engine whether Mbarara, Jinja, Gulu, Arua and Mbale in a substantial way. GDP is 70 per cent concentrated around Kampala but the physical land cannot support many more people than it currently holds. Infact, certain hinterlands of the city are now full.

Feeding a young population is a major challenge. Food in Uganda is generally cheap, a function of favourable climate, soils and cheap labour based on cheap or nonexistent wages. Low wages, while favourable to the national goal of food security, are a long term cost, explaining depressed demand, low savings and lack of retirement savings. The major agrarian initiatives, Naads, Operation Wealth Creation, etc. have muted the impact of Uganda’s catastrophic unemployment situation but they can’t match demand or expectation, contributing measly to GDP.

Uganda’s veritable election machine is in full gear. The Electoral Commission is asking for Shs868 billion. The political expenditure will likely triple that amount. So many constituencies will have to be taken care of. Ahead of the 2021 polls, the President will have to appoint a new Chief Justice, Governor of the Central Bank, Auditor General, Inspector General of Government and Secretary to the Treasury.

The political expenditure will have to assuage the egos of losers. The rhetoric will have to match major missteps, including the result of a major anti-corruption trial in the United States where his Foreign Minister Sam Kutesa may be an unindicted co-conspirator, turning him into an early lame duck.

In Parliament, the President will continue to play a low volley ball of a game of a high degree of cooperation while managing which kind of Parliament will replace the current one. A few major Bills are likely to come up for debate amending the Constitution to deal with the subject of presidential and parliamentary terms.

If he felt he was under pressure to name a successor, this is not the time. The successful deputation of major government departments with his personal picks has grown the pool. In fact, this issue will be dictated by other factor outside the electoral process.

Mr Ssemogerere is an attorney-at-Law and an advocate. [email protected]