Rio Olympics: You don’t harvest apples when you plant potatoes

Every four years around this time, many Ugandans put their wits to use. The athletes who represent us at the Olympics are the beneficiaries. The long Olympics tale interspersed with aberrations like the gold medals of the late John Akii Bua and Stephen Kiprotich has always been the same.

We have mediocre performances on the field, and other embarrassing incidences off the field. One swimmer was so slow, he got out of the pool when everyone else had toweled down and left for other business. A columnist claimed he almost drowned.

Off the field, we once had an athlete attempting to buy underwear with fake dollars.
Some years ago when I was overwhelmed by body weight, I hired a coach to take me through physical drills because the doctor said so. The guy had been a national athlete and was now surviving on people like me. We nurtured a relationship over a long period and I got to know so much about Ugandan sports and athletics in particular.
An average Ugandan athlete is financially on his own and extremely needy. He struggles to pay for his upkeep and training. Feeds and dresses poorly and has no support when he gets injured. He is rarely under the guidance of a well-trained coach.

The plus for most of them is that they are gifted by nature. Many of them rely on their raw physical attributes. This helps them to barely scrape through and beat the qualifying times, against a myriad of odds. Then it is off to the Olympics where they find the best of the best. But before they go, there are incidences where they need to financially ‘appease’ officials to get on the list of those travelling. There was a case of an injured athlete who was ‘selected’ ahead of a healthy one who had also qualified.

Expecting these sort of athletes to bring home medals is asking the farmer who planted potatoes to harvest apples. Uganda’s sports agenda at the national and the international stage will amount to nothing until we understand how things work.

The countries that do well in sports don’t opportunistically leave matters to God, chance and physical endowments of individual athletes. Sports is a science that has been increasingly influenced by good (and bad technology like drugs). That is partly why the Brazilian Men’s National football team is no longer as invincible as it used to be. They relied so much on the natural abilities of their players who are very gifted. The other countries are closing that gap by rewarding, training and motivating players to fill up for what they lack in natural talent.

Sports now involves serious financial investment and planning. The sports power houses of the world have programmes that identify talent in its infancy. They then follow the sportspeople through a deliberate process that develops their formal education and sports education simultaneously. The reason being that if you fail as a sportsperson, then you may continue with formal education.

The one who opts to go the sporting route is well catered for financially because the useful life of a sportsperson as a competitor is limited to less than 20 years. He may then either go back to where he left in the realm of formal education or remain in sport as a coach or manager.

Take the case of the reigning Fifa Men’s Football World Champions, Germany. The plans to win the cup in 2014 started way back in 2001 when most players were teenagers.
In 2008, Singaporean swimmer Joseph Schooling met Michael Phelps as a teenager and admired him as his idol. The system kept Schooling in training for eight years and he went on to beat Phelps to gold in the 2016 men’s butterfly swimming contest.

Players are monitored from their teens and everything about them is recorded as they develop. They have a purpose and goal supported by corporate and national institutions.
They give sport their all without worries. In Uganda, you become a full time sportsperson because you have no alternative. The likes of Philip Omondi, Judith Ayaa, Justin Arop, and many others fell on hard times after stellar sporting careers representing Uganda.

The other path is to be a part-timer; going through formal education and spending less time on sport as a by the way. Many of the children from able families do this and they usually represent Uganda in swimming, squash and other sports that require considerable capital investment. These sort of sportspeople cannot and will never win Uganda medals, let alone perform well. They will just make up the numbers.

Mr Sengoba is a commentator on political and social issues. nicholassengoba@yahoo.com
Twitter: @nsengoba

Groundbreaking: When the mobile phone became a bank

Kampala.

At 17:46 on a Monday, a mobile money customer transfers Shs20,000 to a bank account known as MoKash. Two minutes later, the customer receives a message, that in part, reads “…You qualify for a MoKash loan Shs30,000.” The customer goes ahead and applies for the loan and at 17:51 hours, the loan is approved.

Within a month, the customer is required to payback Shs32,700. The loan approval process happened in a few seconds, which is unlike in the traditional banking sector.

Last week, Commercial Bank of Africa (CBA) Uganda and MTN Uganda launched a service that allows mobile phone owners to save and apply for micro-loans. After at least more than six months, the product secured approval from Bank of Uganda (BoU) to eventually become operational. This will make Uganda the third country after Tanzania and Kenya to launch a similar micro savings and micro loans product.

“We have invested $20m (Shs67.3b) in research and development in innovative products such as M-Shwari in Kenya and M-Pawa in Tanzania. The era of bank branches spread all over the country is coming to an end. The mobile phone is now your branch. It means that millions of mobile money subscribers can now have the full service of a bank on their phones,” says Mr Samuel Odeke, the chief executive officer, CBA Uganda.

In 2012, CBA Kenya partnered with Safaricom, Kenya’s largest telecom company to provide a micro-savings and micro-lending platform. Statistics show that M-Shwari has about 15 million customers as end of June 2016. In terms of savings, the total for the same period is estimated at $82m (Shs276b). CBA had also issued loans worth $1.3b (Shs4.4 trillion) through M-Shwari alone.

Following the success of in Kenya, CBA teamed up with Vodacom in Tanzania in 2014 for the launch of M-Pawa, a product similar to M-Shwari. As at end of June 2016, 63 per cent of users had saved about $5.7m (Shs20b). Borrowing had hit $22m (Shs75b) by end of June 2016. In Tanzania, there are about 5 million people using this M-Pawa.

Both products use the mobile money service, M-Pesa.
The Kenyan and Tanzanian story had to be replicated in Uganda since mobile money has become the most popular form of transferring money. It is estimated that Uganda has about 20 million mobile money users, of which more than 7 million are with MTN Uganda. According to Mr Phrase Lubega, the general manager mobile financial services at MTN Uganda, the telecom transacts about Shs900b a month.

Already by Thursday last week, MTN Uganda reveals that about 83,000 people had signed up to MoKash. The projection is that by end of September 2016, over one million people will have subscribed to the service. Already, mobile money users exceed the number of people who hold bank accounts. Bank accounts are estimated at just short of 5 million people.

A threat to banking
Traditional banking is known for its bureaucracy in the various processes, including account opening and applying for a loan. On average, it can take up-to a month to process a loan in a commercial bank. Additionally, borrowing small amounts Shs100,000 to Shs1m is in most cases close to impossible.

“MoKash allows one to securely save money and take out loans in no more than six seconds on a savings account. MoKash will allow a parent, teacher, boda-boda rider, farmer to have an actual operational bank account on the mobile phone. You can automatically save as little as Shs50 and earn interest on your savings. A conventional bank account will not give you this sort of saving amount. You can borrow Shs1m instantly without being asked for collateral such as a land title and there is no need to sign documents,” Mr Odeke adds.

In Kenya, the service is popular with small corner shop businesses that may require short-term funds that a bank may not have. It has been noted before that mobile money is the most popular cashless payment option in Uganda. It is also considered a threat to traditional banking – according to some. However, for some bankers, mobile money is not a threat but rather serves a market some banks cannot reach.

“The telecoms have been able to provide a product at a much less cost than banks. Mobile money is quick, simple, easy to use and cheap to deliver financial services. We cannot sit here and pretend that the mobile money territory is something a bank can do,” says Mr Patrick Mweheire, the CEO Stanbic Bank Uganda.

He adds that commercial banks will be able to serve many once agency banking comes into force. Stanbic Bank is looking to add at least another 400 agents around the country to deliver banking services. In February 2016, a law was approved that will see commercial banks use agents instead of setting up new “unprofitable” bricks and mortar branches, which the sector had been demanding for.

“We need to get agency banking to work. Also, Stanbic is working with MTN to have a similar product to MoKash,” Mr Mweheire points out.

Manage interest rates without capping them

By Fabian Kasi

First, banks should be given a conducive atmosphere for growth so that they increase economies of scale to lower the cost of operations. This should eventually influence the sustainable reduction in the interest rates.

Secondly, regulators should focus on regulating consumer protection. For example, the measures that Bank of Uganda is taking to ensure that all banks give key fact documents every time a client is accessing banking services, is a move in the right direction. All banks are currently supposed to display tariff guide and complaints handling guidelines in all banking halls.

Additionally, policy makers should focus on creating an enabling environment for an innovative ecosystem of financial service providers so that new and better and cheaper ways of delivering financial services are developed.

More competition among financial institutions should be encouraged so that more choices are available to borrowers.

We need to encourage more savings so that banks can access a bigger pool of relatively cheap and longer term funding. We should remind ourselves that we have one of the lowest savings rate in Africa. Other countries with good savings culture are likely to have friendly interest rates. Rates are even much better in the developed world where all money is channeled through financial system.

We also need to adopt a good loan paying culture to lower default rates and the credit risk.
The measures above would help to prevent unscrupulous providers while ensuring healthy credit markets.

The market should be left to determine the price of credit. Competition should be left to drive efficiency and innovation within the banking sector to the benefit of the borrowers. The role of the regulator should be to create an enabling environment that fosters transparent pricing as well as flow of low-cost funding into the country. Policies should also aim at creating an environment that promotes sustainable financial inclusion partnerships with the private sector.

Fabian Kasi is the chairman Uganda Bankers Association.

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Enrol for higher education, varsity boss tells Basoga

Bugiri- The Vice Chancellor of Busoga University, Prof Dr David Lameck Kibikyo, has lashed out at the people of Busoga over failure to take advantage of existing institutions of learning to further their education.

Speaking at the University’s Bugiri Campus where he addressed both teaching and non-teaching staff last Thursday, Dr Kibikyo said the number of illiterate people in the sub-region is a “big disappointment”.

“You find some people who instead of advancing their credentials to competently compete in the job market are speaking ill of their fellow Basoga who occupy big positions,” he said.

Prof Kibikyo urged the people in the region to emulate the Kyabazinga of Busoga, William Wilberforce Kadhumbula Nadiope Gabula IV, who after his enthronement in September 2014, went to pursue a Masters’ Degree in Economics at Coventry University in the UK.

“If the Kyabazinga, who by virtue of his position went back to school to acquire more academic papers, why don’t you do the same instead of cursing government for not giving you jobs?” he asked.

Commenting on the financial status of the university, which was founded by Busoga Diocese, Prof Kibikyo said its indebtedness has gone down from Shs5.8b as of 2014 to Shs1.8b, adding that there is hope that the debt will be settled by mid next year.

Prof Kibikyo also said the quality of the teaching staff at the university has improved with the recruitment of qualified academic personnel after having fired more than 150 lecturers, who did not have Masters’ Degrees and were not qualified enough to lecture.

editorial@ug.nationmedia.com

Japan to strengthen ties with Africa through dialogue

What is Tokyo International Conference on African Development (TICAD) all about?
TICAD represents Japan’s policy framework towards African development. It is the pioneer international forum focusing on African development.
The first TICAD head of states meeting was held in Tokyo in 1993, shortly after the Cold War ended.
Japan had noticed that developed countries’ interest in providing assistance to Africa had begun to weaken. It was Japan that argued for the importance of Africa. Nowadays, there are various forums through which many countries engage with Africa.

Critics say many international conferences are talking shops. How different is TICAD from the other forums organised by different powers for Africa?
Two features distinguish TICAD from other forums. One is the openness of the forum. The openness comes from the fact that Japan co–hosts TICAD with the United Nations, the World Bank and the African Union Commission. It invites all African leaders, relevant international agencies, development partner countries, private companies and civil society representatives.
The second distinguishing factor is TICAD has a follow–up mechanism.
What Japan and other countries promise at the conference is later verified – at ministerial level so that we do not make empty promises.
The results are reported so that the participants at the conference can verify.

Who is invited to, or will attend, the conference in Nairobi?
Our Prime Minister Shinzo Abe will be coming to Kenya. Your President [Yoweri Museveni] will be in Nairobi, Kenya.
The UN, World Bank and AU [African Union]. It is a global conference. We invite the US [United States], the European Union, NGOs [nongovernmental organisations] and private companies to the forum. We expect 100 Japanese companies to come.
They will discuss a lot of issues connected with African development, including peace building.

What themes will this year focus on?

The last TICAD in 2013 identified three issues. They are sustainable economy, inclusive economy and peace and stability.
Japan’s current development assistance to Africa has been guided by those themes and, Japanese assistance to Uganda originates from these core issues.
I would like to emphasis peace and stability. In the case of Uganda, that is the rehabilitation of northern Uganda. Northern Uganda’s social economic conditions lag behind other parts of Uganda because infrastructure was damaged during the LRA [Lord’s Resistance Army] insurgency.

Which are some of the Japanese companies that will be represented at the conference?
Trading companies, heavy industry companies, companies related to health and sanitation.
Some of the companies that are expected are Hitachi, Mitsubishi Corporation, Fujifilm Corporation, Takeda Pharmaceutical Company Limited, Yamaha Motor Company Limited, Mitsubishi Fuso Truck and Bus Corporation, among many others.
Some of the companies are asking to meet me before they travel to Nairobi. Maybe they want to know about this side so that they can have a clearer picture.

How does Africa benefit from TICAD?
Through technology, Japan strengthens economic development.

Japan will lend Uganda money to finance construction of flyovers in Kampala. When will work begin?
I hope your subcontractors will work very well. Japanese companies – as main contractors – are very few, just four or five people. Japanese workers are so expensive; so we cannot afford to bring Japanese workers here.

When will construction start?
The flyover has three components. One is around the Clock Tower.
The second one is at Nsambya; Nsambya will be an underpass.
The third component will be at the Kitgum House and Oasis Mall intersection.
I heard from JICA [Japan International Cooperation Agency] that the first two components are going very well. But the third component needs some coordination with SGR [Standard Gauge Railway].
Kampala flyover project started on the assumption that there will be a level crossing of the SGR. But a few months ago, there was an announcement that the SGR would be a bit higher in order to avoid level crossing. Currently, we need coordination with SGR project.

Have you talked to the Ugandan side about coordination?
We are waiting for response from UNRA [Uganda National Roads Authority], Ministry of Works.

Will that affect the timelines?
Depending on the coordination, that might cause some delay. I cannot exclude such a possibility.

In terms of cost, what effect would a high level crossing for the SGR mean?
If there are some changes – that the flyover could go up then that could lead to a higher cost. That would be natural.

The government of Uganda needs assistance. This could be in the form of concessional loans, to develop its electricity generation capacity. Will Japan help?
I think there is no room for new, big hydropower generation. What is important is the transmission line to be networked. Maybe transmission is better….
When I was here, Ayago HPP was talked about a lot. At that time, we were willing to consider [financing its construction]. Over time, the situation surrounding power generation changed.

‘Lightning’ strikes thrice as Bolt does 100m hat-trick

By AFP

Rio de Janeiro. Usain Bolt roared into Olympic history yesterday, capturing an unprecedented third consecutive 100m crown to confirm his place in the pantheon of the greatest athletes the world has ever seen.
The 29-year-old Jamaican legend, competing in his final Olympics, powered over the line in 9.81sec, vanquishing drug-tainted American rival Justin Gatlin who took silver with Andre De Grasse of Canada claiming bronze. Gatlin, who had been booed by the Rio crowd as he was introduced, crossed in 9.89sec with De Grasse just behind in 9.91.
Bolt galloped away in celebration after a superb win, basking in the adulation of the stadium and even taking selfies with fans during his lap of honour. He then delighted the fans with his traditional “lightning bolt” pose as reggae blasted out of the stadium sound system.
“It was brilliant. I didn’t go so fast but I’m so happy I won. I told you guys I was going to do it,” Bolt said.
The victory left Bolt standing alone in the 120-year history of sprinting in the modern Olympic games.
No other athlete — man or woman — has ever won three consecutive individual Olympic sprint titles.
It also leaves Bolt on track to complete an incredible “triple-triple” of clinching 100m, 200m and 4x100m relay titles for a third consecutive Olympics. “Somebody said I can become immortal. Two more medals to go and I can sign off. Immortal,” Bolt added.
Bolt, the 2008 and 2012 Olympic champion, had already earned the right to be regarded as the greatest sprinter in the history of athletics after accumulating more golds on the track than anyone else.
But the Jamaican’s latest triumph erases any lingering doubts that he deserves to be ranked alongside the likes of Muhammad Ali, Pele and Michael Jordan as the kind of once-in-a-generation athlete who transcend their sports.

Year of shame
Bolt’s win — his 18th gold in Olympic and World Championships since 2008 — averted what might have been a public relations disaster for the drug-tarnished world of track and field.
A corruption scandal involving the sport’s former rulers, who were accused of accepting bribes to cover up positive drug tests, and an investigation which alleged an elaborate state-sponsored doping system in Russia have plunged track and field into the worst crisis in its history.
A gold medal for Gatlin on Sunday would have made uncomfortable viewing for many — world athletics chief Sebastian Coe among them — who have advocated that serial doping offenders should be banned for life. Gatlin, who has served two drug bans during his long career, made a powerful start to lead over the first 50 metres.

MEN’S 100M RESULTS
1. Usain Bolt (JAM) – 9.81
2. Justin Gatlin (USA) – 9.89
3. Andre De Grasse (CAN) – 9.91
4. Yohan Blake (JAM) – 9.93
5. Akani Simbine (RSA) – 9.94
6. Ben Youssef Meite (CIV) – 9.96
7. Jimmy Vicaut (FRA) – 10.04
8. Trayvon Bromell (USA) – 10.06

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Uganda’s public debt to keep rising

The International Monetary Fund projects that Uganda’s public debt will keep raising to 2021 due to ongoing ambitious infrastructure investment by government.
Uganda is facing a problem of infrastructure deficit, which is affecting the country’s long-term economic development and is the reason why government has scaled up investment infrastructure development by borrowing to close budget deficits for infrastructure development.

In an interview with Daily Monitor recently, the International Monetary Fund Resident representative in Uganda, Ms Mira Clara, said: “The current ongoing ambitious infrastructure investment scaling up will result in an increase of the public debt, with total public debt projected to peak in FY2020/21, at about 50 percent of GDP (and external public debt at about 36 percent of GDP), and decline thereafter, as the scaling up process is completed.”

Ms Clara added: “In line with the National Development Plan, the current ambitious medium term investment plan includes projects to enhance electricity production, revamp the transport network (with roads, airports and the standard gauge railway) and prepare the infrastructure necessary for oil production.”

The IMF and the World Bank occasionally carry out joint staff debt analysis of a particular country to find out whether that country is at the risk of falling under debt risk distress.

“In our view, Uganda’s public debt is currently sustainable and so is the projected accumulation path, provided that the deficits are used to finance infrastructure investment (as is currently planned) and that the investments are implemented properly,” she said.

More often than not, the government has said Uganda’s debt level is still sustainable. Ms Clara said: “Indeed, in our latest analysis of debt dynamics, in which we analyse recent developments and medium and long-term prospects, the “debt sustainability analysis”- we came to the conclusion that debt remained at low risk of distress.”

Ms Clara said Uganda is working to get the best possible financing terms and conditions for these infrastructure investment needs. While recourse only to concessional debt is not enough given the size of the projects, the government has secured non-consessional loans at better-than-market financial terms.

Ms Clara explained that the proper selection, sequencing, and implementation of the large infrastructure projects remains essential to ensure that projects produce the desired growth and productivity enhancing effect while maintaining debt sustainable.
She further stated that independent feasibility studies are required to select the best, commercially viable projects, pointing out that the sequencing of the projects is also necessary to ensure they do no overheat the economy and can be properly implemented without delays and adequate monitoring.

“As the currently planned infrastructure-related projects are implemented, the better provision of electricity, energy and transportation, together with the ongoing work to continue improving the business environment, is expected to unleash growth potential,” she said.

Looking ahead, she stressed that efforts towards enhancing domestic revenue collection would reduce the borrowing needs and provide more space to borrow sustainably and that efforts towards improving export performance would also improve the sustainability of the debt.

The government, through the ministry of Finance, has a debt management unit to ensure that the country’s debt level remains under control.

Ms Clara stated that debt management should strive to extend the maturities; currently the low revenue base combined with short maturities of domestic debt results in a high debt-service-to revenue ratio. Additional reforms aiming at improving governance, transparency, and public financial management would also help to improve debt dynamics.

“Finally, actions to ensure that the whole population, including the poor, benefits from this growth associated with the infrastructure scaling up would be welcome, including by targeted interventions to ensure inclusiveness,” she said.

In an interview with Daily Monitor, deputy governor, Bank of Uganda, Dr Louis Kasekende, said Uganda’s public debt though still sustainable, has risen in recent years, primarily on account of borrowing to finance infrastructure projects that are necessary to improve the economy’s productive capacity and competitiveness over the medium-long term.

“As read out in the 2016/17 Budget Statement by the Minister of Finance, net present value of debt is about 31 per cent of GDP while total nominal public debt is about 34 per cent of GDP. In volume terms, external debt is currently estimated at about $5 billion and domestic debt (treasury bills and bonds) at Shs11.612 trillion by end of June 2016,” he said.