What you need to know:
I said so before in the Daily Monitor of November 10, 2014 in an article titled, ‘We let foreigners make decisions for us all, so why complain now?’
As Ugandans, we must get addicted to pain. The economic downturn is hitting us where it hurts. But when we watch TV, we hope to hear something the government is doing about the situation.
What do we get? Nothing. That’s what the government says it can do. Nothing. Why? Because it is a global problem caused by factors such as the war in Ukraine, the effects of Covid 19, etc. We do not only live in a global village, we are also under the mercy of a free market economy. Still, the government must not watch our pain with folded arms. There must be something it can do.
This is not the only way an economic crisis is dealt with. Let me illustrate. The Asian financial crisis of 1997/98 swept through East and Southeast Asia like a wildfire.
It was caused by two things. First, the collapse of currency exchange rates. Second, the bursting of the “hot money bubble” resulting from massive inflow and outflow of capital. Starting in Thailand, it raged through Singapore, Malaysia, Indonesia, South Korea and the Philippines.
Enter the IMF with its usual loans to fix the problem. Several countries snapped up the offer. However, Dr Mahathir Mohamad, the Malaysian Prime Minister, rejected it totally. He did so for two very simple reasons. One, he was worried that the IMF would take control over Malaysia’s economy. Two, he was worried that the IMF would not care about any political effects of the one-size-fits-all solution.
Boldly, courageously and unapologetically, Mahathir pushed Malaysia to chart its own path out of a crisis that had brought an entire sub-continent down on its knees. Why did he do that?
Writing in the Journal of Contemporary Eastern Asia, Volume 11, No.1 of April/May 2012, Fumitaka Furuoka, Beatrice Lim, Catherine Jikunan and Lo May Chiun offered insights that Ugandans should pay attention to. They noted that as IMF’s conditions were very strict, some experts doubted the validity of its policies.
“Some economists, such as Jeffrey Sachs, criticised the IMF for making a wrong diagnosis and prescribing the wrong medicine to Asian countries. They believed that the IMF’s rescue packages were suitable for the countries whose problems were caused by the public sector’s debts and government’s overspending. Asian countries’ problems, quite on the contrary, stemmed from the private sector,” they argued
These economists, they went on, believed that the IMF’s measures, such as the cut of public spending and tightening of credit, were the wrong measures for Asian economies. It was thought that the IMF’s policies pushed Asian countries into a deeper recession.
“In contrast, the Malaysian government decided not to borrow money from the IMF. Instead, the government imposed capital control in order to overcome financial problems that were caused by the ‘contagion effect’ of the Asian economic crisis,” the authors stated.
They further stated that instead Mahathir Mohamad announced a new economic program meant to stop the outside world from controlling the movement of the national currency, the ringgit.
“According to Dr Mahathir, this plan was meant to isolate Malaysia’s economy from the international currency speculators and traders whom he blamed for causing the country’s economic crisis,” the authors pointed out.
Malaysia weathered the storm. It came out strong, tall and proud.
My point is, it is pointless for Ugandans to direct anger towards Enrica Pinneti, the Italian woman who came to our country with nothing but an opera song and got free money, free land, the freedom not to pay taxes, and the freedom to thumb her nose at us.
She is not the problem. We are! I said so before in the Daily Monitor of November 10, 2014 in an article titled, ‘We let foreigners make decisions for us all, so why complain now?’ The editor highlighted this sentence: “By letting multinational corporations, the World Bank and IMF make major decisions for us, we put in jeopardy our very sense of pride and independence.”
Go on, just bear your pain and let Pinneti be. Or do something.
Dr Akwap is an associate consultant, Postgraduate Diploma in Journalism and Communication Management, UMI.