Monday, June 5, 2017

#Uganda's #budget returns country to feudalism

As we discussed over the last two weeks, the national budgeting process in Uganda does not provide a useful understanding of the country's economy.
Our national budgeting is nowhere near close to addressing strategic goals.
It tells us about that what and when of the economy and government proposals but does not clearly explain the why.
It tells us that for the wedding of Mary and John we are going to hire 20 limousines, but does not explain why a wedding should use 20 limousines when four can do.
The proposed 2017/2018 Budget that was announced last week showed that Uganda still does not know what it wants and what it is doing.
It was the usual story of a society that lives in confusion and waste. State House is given a large amount of money and an institution called the Office of the President that is different from State House is also given a separate and also large budget.
It is a revert to feudalism that the Museveni government has taken Uganda, the times 600 years ago where the king was the richest man in the land and was the chief benefactor of his people.
There were no impersonal, bureaucratic institutions at work to distribute resources and administer the kingdom. The king was the state and kingdom.
That is what this idea of State House as an entity with a budget larger than most government ministries reveals.
However, as I have written a few times in this column, the good thing in all this is that there are governments in North America and Europe always willing to babysit these incompetent African states.
Ultimately it is they who pick up the bill for our waste and they don't seem to mind that. Or perhaps, as many think, they know what they are doing and all this "aid" they give us is really a rope designed to help us hang ourselves.
Going forward into the 2017/2018 financial year, we can expect more of the same over the last five to seven years.
Industrial production in Uganda will remain too weak and on too small a scale to create enough jobs for the unemployed youth.
Imports of goods of all grades and prices will continue pouring into the country in 2017-2018, increasing the balance of payments trade deficit that our fish and coffee exports cannot offset.
For that reason, the Uganda Shilling will continue to trade in the Shs3,500 to Shs3,800 or Shs4,000 range against the US dollar.
The young people finishing school and entering the workforce generally do not have much in the way of specialist, in-demand skills.
The Chinese will continue to act the part of the ministry of Works, repairing more municipal roads in Kampala and other towns as well as building the new highways.
The European Union will continue funding many humanitarian and social programmes that the government of Uganda long ago abandoned.
The United States government will continue to do the same, as well as engage with the Uganda government in training of the army or leading counterterrorism campaigns in the region.
Everyone will continue pretending that the Government of Uganda is a responsible, competent entity heading a sovereign State.
Pretence is sometimes an essential part of diplomacy and relations between nations.
I do not see circumstances under which countries like Uganda will register anything that can be called net development. By net development I don't just mean growth rates and low inflation.
I refer to solid internal strength, one not dependent on foreign aid or foreign-produced goods.
An economy based on the production of patented and copyrighted work and inventions.
A country where less than 50 per cent of the national economy is in the capital city and the rest is spread out more evenly across the rest of the country.
A country where the best television station in Uganda is one based in Mbale or the best printing press is in Masaka and the best restaurants are in Gulu, not Kampala.
That kind of diversified economy like Britain's, for example, where world-famous football teams are located not in the capital London, but cities like Manchester and Liverpool.

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