MPs vet Mutebile for another 5-year term 

Bank of Uganda Governor, Mr Emmanuel Tumusiime Mutebile. He said central bank is concerned with the increase in government indebtedness. Photo by David Lubowa.

What you need to know:

  • The governor has navigated a stormy period that the central bank has endured in the recent years. 
  • The year 2019 was particularly hard for BoU, with the sensitive institution plagued by bad publicity amid multiplicity of accusations.  

Bank of Uganda (BoU) Governor Emmanuel Tumusiime-Mutebile was yesterday quietly led before the Appointments Committee of Parliament for vetting ahead of starting another five-year term in office following reappointment by President Museveni last month. 

Journalists who waited to hear from Mr Mutebile ahead of the exercise and after were disappointed as the long-serving governor was led into Parliament through the secluded President’s Office wing and also led out through the same outlet. 
There was no communication as to what transpired in the vetting room by press time.

The governor has navigated a stormy period that the central bank has endured in the recent years. 
The year 2019 was particularly hard for BoU, with the sensitive institution plagued by bad publicity amid multiplicity of accusations.  
 
Former Deputy Governor Louis Kasekede left the bank in January last year after the President declined to renew his contract, despite a number of reminders from Finance minister Matia Kasaija. 

The suspense
The decision left many speculating on what would be the fate of long-serving Governor Tumusiime-Mutebile, whose tenure then had a year left. 

When the President appointed Dr Michael Atingi-Ego as Deputy Governor in March last year, many thought it was the beginning of the transition from Mr Tumusiime-Mutebile’s two-decade reign at BoU. 

But as Ugandans were guessing over when the government would reinstate the Internet that was switched off days to the January 14 elections, Mr Museveni communicated that he had extended the governor’s term for another five years.  
The re-appointment was announced on the eve of the election.
 
“We have learnt that the President has re-appointed Prof Emmanuel Tumusiime-Mutebile as Governor of Bank of Uganda for the next five years,” Mr Kelvin Kiyingi, the deputy director of communication at BoU, confirmed on January 18. 
Yesterday, Mr Mutebile appeared before the Parliament’s Appointments Committee for vetting before his re-appointment would be confirmed. 

The 71 year-old, who was first appointed governor in January 2000, remains the longest serving chief executive of the bank since its creation, guaranteed to complete 25 years by the time his new tenure ends in January 2026.
 The second longest serving governor was his predecessor Charles Nyonyintono Kikonyogo, who served from 1990 to 2000, while Leo Kibirango comes third after heading the bank from 1980 to 1986. 
 
But what does Mr Tumusiime-Mutebile’s continuation mean for BoU? 
The executive director of Civil Society Budget Advocacy Group (CSBAG), Mr Julius Mukunda, says Mr Mutebile is needed to continue and guide the new deputy governor, Dr Atingi-Ego. 

“I think Mutebile has been one of the best governors in Africa. He has been winning accolades in recognition of his performance. There is no doubt that Governor Mutebile can manage where he is now and the fact that now there is a new Deputy Governor with a very good background in economics, wide range of experience and also being an insider having worked there before, I am extremely confident that the current affairs of the bank are managed very adequately,” Mr Mukunda opined. 

A free market fundamentalist, Mr Mutebile is credited with spearheading the design and implementation of the Economic Reform Programme that steered Uganda from the economic crises of the 1970s and 1980s to sound economic performance during his service as the Permanent Secretary/Secretary to the Treasury in the Ministry of Finance. 

According to Mr Mutebile’s official profile, he also worked as a consultant for multilateral and regional organisations, including the World Bank, International Monetary Fund, Organisation for Economic Cooperation and Development, Macroeconomic and Financial Management Institute of East and Central Africa, UK Department for International Development, the North South Institute in Canada, and for the governments of Rwanda, Kenya, Tanzania, Eritrea, and Nepal.

Mr Mukuda said his only trouble with the bank, which he says Mr Mutebile and Dr Atingi-Ego must lay their hands on, is developing a policy to deal with the high interest rates by commercial banks, which he says has a negative effect on the private sector development. 

Mr Wilbrod Owor, the executive director of the Uganda Bankers Association, which brings together all commercial banks being regulated by BoU, welcomed the re-appointment of Mutebile, but declined to offer further comments.

In the last three years, Mr Mutebile and his team have been in and out of Parliament, appearing before the Committee on Commissions, Statutory Authorities and State Enterprises (Cosase) as they faced queries arising from the reports of the Auditor General. 

At the end of 2018 and into the first two months of 2019, Prof Mutebile became a regular visitor to Parliament as Cosase, then led by Bugweri County MP Abdu Katuntu, probed how the central bank closed seven commercial banks over the years. 

These included Crane Bank Limited, the most recent casualty whose sale to dfcu Bank caused a tremor through the banking industry and entire economy because of its sheer size and the fact that it belonged to businessman Sudhir Ruparelia, who refused to let go of the bank without a fight. 
The others were Teefe Bank, Cooperative Bank, Credit Bank Limited, Greenland Bank, National Bank of Commerce and Global Trust Bank. 

The probe cast the central bank in the spotlight for an extended period.
After the Cosase probe, another investigation ordered by President Museveni in June 2019 following the illegal appointments and transfer of staff in BoU, revealed that there were cliques attached to the governor and his then deputy in the fight for power. 

“As concerns the existence of cliques, one staff went further to characterise the cliques as potentially religious-based. In the words of the staff in question. There is a risk of divisions according to religion in that bank. Catholics and Anglicans have their own groups. They have meetings and each has its own power,’” the report seen by this newspaper reads, in part.

The two probes recommended an overhaul in the leadership of the bank, which would also include relieving the governor of the responsibility of chairing the Board of Directors. 
Commenting on the reappointment, Budariri West MP Nandala Mafabi, who has been calling for reforms at BoU, said he was surprised that the President still holds trust in the governor to continue at the helm of the bank. 

He said although Mr Mutebile has had excellent performances as a principal economist, Secretary to the Treasury and also in his index years at BoU, he has lost steam and is no longer fit to hold the office. 

“In my view, Mutebile is no longer on top of things … We would have retired Mutebile and if we want him, make him a consultant for the bank but from outside. He can nolonger match with the pressures of this fast moving world and the technology that has come with it,” Mr Mafabi said.

More scandles at the bank

Currency printing Saga
In June 2019, the bank was covered under yet another dark cloud when it emerged that officials had connived with private businesspeople and organisations to transport their merchandise on a chartered cargo plane delivering newly printed currency from Europe. 

Information at that time revealed that the plane fully chartered by BoU had 25 pallets containing currency but only 20 belonged to BoU. Although they were intact upon delivery, the central bank detected that what was delivered was more than what was expected, something that sparked an investigation when Mr Mutebile raised the red flag. 

The State House Anti-Corruption Unit picked on the investigation and at some time stormed the central bank to collect evidence. The outcome of the probe has never been made public. 

The same year, the bank conceded that some of its staff tasked with the destruction of old currency notes had been going against the guidelines and instead used the notes to enrich themselves.
Some staff at the Mbale Currency Centre were arrested over the scandal, which left the top managers at the central bank carrying shame on their faces because of public rebuke.

Another scandal that has remained unresolved is the alleged sale of land titles of Mr Chris Tushabe, who was a shareholder in Cooperative Bank. Mr Tushabe told Cosase last year that a BoU official, who was the liquidator of Cooperative Bank in 1999, connived with illegal firms to sell his land titles, which made him lose prime properties in Kampala and Kasese.

Welcome!

You're all set to enjoy unlimited Prime content.