Investment key to middle income status

Last Friday, President Yoweri Museveni held his Inaugural Cabinet meeting where he tasked the incoming ministers with a 15-Point plan detailing what is expected of them in an effort to move Uganda into a middle income status by 2020.

Uganda is currently a low income country and the transition from low income to a middle income country will mean our Gross National Income goes from about $1,045 to over $2,000, which will be no easy task. Drastic measures have to be taken to attain the middle income status.
The President, therefore, tasked his ministers to encourage investment in the country. He said he expects no delays when it comes to licensing investors. He said he was irked by the fact that investors who come here willingly are ‘tossed about’ causing delays that sometimes make them lose interest and decide to invest in other countries.

I also think that the long bureaucratic process is disadvantageous to our country because the investors would, otherwise, have taken this opportunity else where with a much faster licensing system. The vision of a middle income status cannot come to fruition with such a choke point in the system.
The president also mentioned that there should be a provision where feasibility studies of potential products are carried out across the whole spectrum of our raw materials of agriculture, minerals and skills before being presented to potential investors.

I believe this will give us the upper hand when it comes to making decisions about what these investors can and should concentrate their efforts on. It also makes us knowledgeable on how many opportunities we have and how much we can do to change our country. The moment we realise this, is when we shall stop dragging our feet and work hard towards achieving a middle income status.

hannah.nyombi36@gmail.com

Minister to give Shs30,000 for burials

Speaker Rebecca Kadaga (Left) addresses a gathering at Kamwezi village in Kabale District as Mr Herbert Kabafunzaki, the minister of State for Labour (Right), looks on. PHOTO BY ROBERT MUHEREZA.  

KABALE- State minister for Labour Herbert Kabafunzaki has said he will be giving condolence of Shs30,000 to every family in the constituency that loses a member.

Mr Kabafunzaki was at the weekend speaking at the launch of his constituency offices at Rwamatunguru in Kamwezi Sub-county which was attended by Speaker of Parliament Rebecca Kadaga.

Mr Kabafunzaki (NRM), who defeated FDC’s Jack Sabiiti, also promised to give four pigs to every village for multiplication and poverty eradication as well as establishing a sausage making plant.

“I have opened constituency coordination offices in every sub-county where the administrators shall be giving Shs30,000 as condolence to every family that loses its member. I will do this until my term of office expires, because I know that whereas government buys medicines for patients in health centres, it does not facilitate burial arrangements in case a patient dies,” he said, pledging to use the money given to MPs for car allowances to buy a constituency ambulance.

Mr Kabafunzaki also promised to put in place a community radio station in Rukiga County to help in community mobilisation.

editorial@ug.nationmedia.com

Budget: We must realign strategic focus and funding priorities

If Uganda was a corporate entity, the CEO would have been sacked soon after the Budget presentation because the strategy and funds allocation ignored the underlying drivers of under performance in the preceding period (2015/2016) – a case of budget misalignment!

Statistics indicates that the performance of Uganda’s economy using GDP as an indicator grew at 4.6 per cent in the FY 2015/2016, lower than 5.3 per cent in 2014/2015. So what were the drivers of this under performance? These have been well articulated as: The sharp fall in international prices of key commodity items such as coffee, tea, minerals; the significant decline in private sector credit on account of high lending rates, thereby stifling domestic activity; the strengthening of major currencies against the Shilling.

Before we look at the strategic areas and how they align to addressing the challenges to GDP growth, let’s answer these questions. Of the three key drivers of our GDP under performance, only one is internal or within the control of government while the other two are largely external and outside the control of government; so what should be our strategy? Our export earnings are just a fraction of total earnings and if it has impacted GDP, what would be the scenario if we were a major export earner? Shall we not increase our vulnerability by enhancing productivity in the export items? What should the strategy be since we are not in control or have no capacity to influence foreign market prices? The strengthening of the major currencies did not end in 2015/16 so how are we prepared to absorb the shocks of recurrence in 2016/17?

These should inform the budget focus areas and strategy! What is the focus of the current budget towards dealing with the decline in private sector credit uptake, which stimulates domestic activity?

To answer these pertinent questions, there is need to delve into the causes that manifested in these challenges. For instance, what caused high interest rates and how are we prepared to address the causes in the new financial year so as to drive growth?

Now let’s look at the current budget (2016/17) with the theme “Enhancing productivity for job creation” with the following strategic areas: Enhanced production and productivity; development and maintenance of strategic infrastructure; human capital and skills development; improving good governance. So how are we dealing with the challenges of the previous year with this kind of strategic focus areas which are totally disconnected?

Other than misaligned strategic focus areas, the funding priorities are already misdirected to administrative overheads (expansion of Cabinet, among others) hence redundant focus areas and failure from the start. This is like a CEO citing under-performance of the export sector which formed a major client base leading to low growth as major blows to the decline in the bottom line to the board. When it comes to the strategy, there is nothing about diversifying the client base to other sectors to build resilience to such shocks and instead, he focuses on staff productivity, flamboyant head office space; staff training with new skills that are not addressing the institutional performance challenges, which are external in nature. In terms of budget allocation, he starts by asking for funding to increase head count of management team.

With a budget that clearly brings out reasons for failure and sweeps them under the carpet while deliberately focusing on political tokenism with a sugar-coated theme and strategic areas crafted by the best brains in economics, it’s a sure failure of the economy and hardship ahead for the citizens. This is the reason poor quality universal education introduced – to create citizens with short memory and less critical thinking for ease of manipulation for political capital.

Whereas it’s good to enhance productivity and production by developing infrastructure while human capital and skills development helps to create value addition to production at the same time observing the rule of law, security and human rights; where is the production going to be sold? In the same foreign market where prices are not within your control? Where trade is done using major currencies whose value is not in your control?

You need local consumption capacity (demand) to automatically drive productivity and production – enhance household incomes, address poverty which is real not the political poverty statistics being talked about in Uganda. Enhanced household income means available public savings in banks for lending rather than fixed deposits at high rates from the few rich, which also drives lending rates. There will definitely be demand for private sector credit as well as local consumption at prices we can regulate such that when foreign prices fall below certain thresholds, we regulate production/export to domestic consumption ratio to minimise impact on our GDP growth!

In my opinion, we cannot continue playing semantics and doing the same things expecting different outcomes. The government and leaders should take Ugandans more seriously.

Mr Adiga is an economist and banker. jadiga73@gmail.com

4,000 girls miss out on cervical cancer vaccination

SEMBABULE- About 4,037 girls aged 9-13 have missed out on cervical cancer immunisation due to shortage of Human Papilloma Virus (HPV) vaccine.

The free exercise was launched last year to reduce on the high cases of cervical cancer in the country.

However, in Sembabule District, the exercise has been hampered by the shortage of HPV vaccine.

Ms Masituula Nalwada, the in-charge of the district vaccine centre, said the target was to immunise about 6,687 girls but the district received only 2,650 doses of HPV vaccine, leaving a total of 4, 037 girls in the targetted age bracket not immunised.

“The parents have brought their children for immunisation but we have a shortage of vacciness,” Ms Masituula said
She said the Health ministry sent them vaccines without considering the district’s targeted population.

Health officials in the district had also planned to use the same opportunity to immunise the girls against tetanus.
The district health officer, Dr Charles Matovu, said he is going to request the Ministry of Health to dispatch more vaccines .

The HPV vaccine is taken in two dozes at an interval of six months and can prevent cervical cancer as well as some cancers of the lungs.

Cervical cancer is one of the most commonly diagnosed cancers among women aged 15 to 44. About 3,915 women are diagnosed with the virus annually and 2,275 women succumb to the disease per year, according to the Health ministry.

editorial@ug.nationmedia.com

The Brits are headed for the exit, is anyone in the EAC paying attention?

By Daniel K. Kalinaki
Posted 


Thursday, June 30  

2016 at 

01:00

A very good friend, who is both fiercely intelligent and usually restrained in her views, surprised me a week ago by declaring, over drinks in Nairobi, that she was hoping Britain votes to leave the European Union.
Before I could overcome my surprise, she added that she also hopes Donald Trump wins the US presidential election in November. She was dead serious, and sober to boot.

Her argument, to hack it savagely and try to fit it in a paragraph, is that we have a varnished view of many Western societies and that the extremist and insular views espoused by people like Trump, Nigel Farage and other right-wingers are more mainstream than we are willing to accept.

Britain’s vote to leave the EU, which I learnt with shock the next morning, has of course validated some of my friend’s arguments, regardless of the outcome of the US election (where I still think the clever money is on Hillary Clinton being the least-worst option). The full extent of the fallout will take many months, probably years to become fully evident, but the vote itself offers some lessons for those involved in similar transnational projects, including the East African Community.

For far too many people, regional integration, and the basis of free markets on which it is built, has come to sound like hollow sloganeering of predatory global capitalism. Behind the angry rhetoric of xenophobia, racism, anti-migration and renewed calls for protectionism lie genuine fears about jobs, social safety nets and the widening gulf between the very rich and the very poor.

We should, of course, condemn these backward and short-sighted responses, but we must analyse and understand the underlying sentiment. Free markets, we are told, lift all boats, but when the canoes of the poor and vulnerable spring leaks and no one seems to care, it can be tempting to throw the migrants and foreigners overboard, as some in the Leave campaign would have it.

What makes Brexit particularly remarkable is that the EU has brought many tangible benefits to ordinary people, from visa-free travel to free labour movement, to lower roaming charges.

The EAC project has similarly brought gains, particularly in the free movement of capital and a reduction in some of the non-tariff barriers, but look beyond the surface and the disuniting factors stick out prominently. For all the talk of free movement of labour, one still requires a work permit, obtained with varying degrees of difficulty, even where it is free, theoretically. One can’t buy land across the border except through legal manoeuvres; roaming charges are falling but still expensive; travel across borders is inefficient and bureaucratic and air travel in East Africa remains extortionist (yes, Kenya Airways, we are talking about you!).

Insularity doesn’t bring prosperity, but neither does all-out integration in which regional and global capital is seen to benefit at the expense of poor natives. President Museveni, a strong proponent of regional integration, has recently expressed concern about Uganda being a supermarket for foreign-made wares. He forgot to mention that most of the supermarkets themselves are foreign.

The EU expansion that brought in the poorer cousins from the east was always going to test the unity of the trading bloc – unequal partners rarely make great partnerships – and Brexit is a shocking example of a richer member trying to kick away the ladder to keep out the village cousins.

East Africa has been there, seen that. If we need reminding, Brexit offers at least two lessons: one, that abstract notions of political federation are risky, vulnerable to domestic political realities, and perhaps best left out of the conversation for now.

Two, that unity works where there are tangible benefits to ordinary people, where the richer states subsidise the poorer ones without feeling short-changed, and where the bureaucracy does not interfere too much in domestic political and economic affairs.

Europe’s history is one of trying to unite the continent either through violence or through consensus. The EU was evidence of violence not being the answer. Brexit might be evidence of consensus not being the answer, either. The EAC should watch and learn, seeing that we do not seem to have learnt much from our first attempt at regional integration.

Mr Kalinaki is a Ugandan journalist based in Nairobi. dkalinaki@ke.nationmedia.com Twitter: @Kalinaki

Journalists reject licensing

Mr Haruna Kanabi, a media practitioner, during a dialogue between journalists and officials from Uganda Media Council in Arua Town on Tuesday. PHOTO BY FELIX WAROM OKELLO 

ARUA- Media practitioners across the West Nile region have rejected a move by Uganda Media Council to have them registered and licensed.

During a dialogue between media practitioners and officials from Uganda Media Council in Arua Town on Tuesday, the media practitioners said registration and licensing of journalists would infringe on press freedom.

Mr Steven Candia, a Mega FM journalist, said: “We have fear that the State will at its discretion revoke the licences or de-register any journalist whom they deem not fit or has written certain stories against it, at will. This will infringe on our rights to work in a proper environment. So the registration may not be an ideal thing to do as of now.”
Some journalist said the government should instead ensure that there is a minimum wage for journalists and enact fair laws to govern the media.

A member of the media council, Mr Venis Omona, said: “We need regulations and professionalisation of the media to ensure public accountability. Registration and licensing will help to check on media to have responsible reporting.”

Petition
A petition to the Constitutional Court in 2014 by Human Rights Network for Journalists (HRNJ-U), challenges the law on registration and licensing on the grounds that it “violates freedoms of speech, expression, the press and other media as contained in Article 29 of the Constitution, as well as other key provisions that provide for protection of fundamental human rights”.

HRNJ-U, the Centre for Public Interest Law and East African Media Institute officials are still battling to have the case at the Constitutional Court heard and ruling made.

wokello@ug.nationmedia.com

British EU exit vote rocks global hegemony

The world woke up last Friday with news of a vote in the United Kingdom to leave the European Union. With the result, British Prime Minister David Cameron threw in the towel, setting stage for a successor to be in place by September. The Labour party, the official opposition, is in turmoil. The Scottish nationalists, the third largest parliamentary party with 59 MPs but just 5 per cent of the national vote last May, are contemplating a second independence referendum. It’s not as easy as it sounds as the Scottish nationalist vote is inflated by gerrymandering from the Labour years that gave Scotland an outsize number of constituencies. In the most recent polls for the Scottish parliament in Holyrood, SNP carried a bare plurality of the vote – 40 per cent, which is closer to the 45 per cent referendum result. A referendum may do little more than confirm this result.

So what happened? Too many voices are locked out. Even as total vote share shrunk for the largest parties, Conservative and Labour, their stranglehold on Westminster tightened. In 2015, Conservative and Labour total vote share shrunk to 66 per cent of the total vote. UKIP, an indirect breakaway on the right from the Conservatives, earned nearly 20 per cent of the vote but earned just one Member of Parliament. In a referendum, the Remain campaign failed to understand their opponents began off with 20 per cent and a majority of conservative voters who voted to leave the UK. One third of Labour voted to remain but that wasn’t good enough to offset Conservative votes lost to leave.

Britain, since the debacle of the Second World War, has mostly been living by the rules. It has settled its war debts, released the colonies even though manoeuvers at independence left them unstable with teething problems. It just paid off its war reconstruction loans to the Bretton Woods Institution in 2001.

The Conservatives in 1979 inherited another problem; an industrial state which was suffering from disinvestment and persistent labour unrest. Turning off the tap quieted many of these industrial towns all over England. Most of the towns that voted Leave were long ago left behind by prosperity that concentrated more in London, the centre of financial services and more than 20 per cent of the UK economy.

There has been a minority view that what UK needs is a special relationship with Europe. The EU in anger says no. Special arrangements like the one afforded Norway, Switzerland and a few other states require them to contribute to the EU budget, implement thousands of EU regulations without a direct input to them.
The EU politicians need time to sober up. With Britain gone, they have lost 20 per cent of the size of the EU economy. Britain is the world’s fifth largest economy. The Conservatives, better at public finances than the wastage during the flush Labour years, have spent the last six years shoring up the treasury even though the deficit is not entirely closed. Painful cuts gave Britain a lot more room to grow and it has swept past France but the growth inside Britain has been less equitable. Scotland has a golden handshake to keep it happy even though its oil reserves will soon run out.

Labour, in opposition under Jeremy Corbyn, has an internal war partly centred on the return of the Blair people. Tony Blair, much a charm when he won power in 1997, is now largely discredited after the Iraq war. Corbyn’s people are promising war in the primaries to deselect a number of MPs. The Conservatives are locked in a major internal war. Britain may eventually end up with multiple parties and coalitions that may never agree on the actual terms of Brexit.

Mr Ssemogerere is an Attorney-at-Law and an Advocate. kssemoge@gmail.com