The World Bank has suspended their budget loans and the financial support for the Government of Uganda in this calendar year. President Museveni is seeing the ramifications of his inactions of fiscal policies and the way it’s interpreted. What the World Bank can question is the ability for the Ministries of Uganda to take loans in their own ways.
World Bank Statement on suspension of Development Funds for Roads:
“Following the cancellation on December 21, 2015 of the World Bank supported Uganda Transport Sector Development Project, overseen by the Uganda National Roads Authority (UNRA), the World Bank has suspended the disbursement of funds for civil works in two other projects in Uganda. Those projects, overseen by the UNRA, are the North Eastern Road-Corridor Asset Management Project and the Albertine Region Sustainable Development Project which are suspended pending a review and strengthening of the capacity of UNRA to adhere to the required environmental and social standards. We are continuing to work with the Government to ensure all Bank-supported projects help Ugandans improve their lives while protecting the poor and vulnerable” (World Bank, 2016).
World Bank Statement earlier in September:
“The World Bank Group took a decision to withhold new lending to Uganda effective August 22, 2016 while reviewing the country’s portfolio in consultation with the Government of Uganda. We continue to actively work with the Ugandan authorities to address the outstanding performance issues in the portfolio, including delays in project effectiveness, weaknesses in safeguards monitoring and enforcement, and low disbursement. We reiterate our commitment to doing everything possible to work closely with the Government of Uganda, as well as with other stakeholders, to support the country’s development and ensure that all World Bank-supported projects deliver tangible and long-lasting results to all Ugandans, especially the poor and vulnerable” (World Bank, 2016).
President Museveni writes to the World Bank:
“President Museveni has written to the World Bank (WB) promising that his government is addressing the structural gaps and other loopholes that compelled the bank early this month to announce withholding of more than $1.5b (Shs5 trillion) in new lending until further notice. The President’s letter to WB, also copied to senior officials in the Ministry of Finance, is part of efforts by government to salvage the loans and save many projects whose failure could have wide economic and political ramifications” (…) “The other guidelines that finance officials will table in Washington, he said, is for all projects to have a “component of benchmarking by Parliament” before the loans are approved. Previously, he explained, ministries would push to get loans whose absorption and project implementation plans are not ready. “For all loans that have not been absorbed, I have evidence where the ministers say they were ready. But by adding a component of benchmarking, they have to justify the request and also satisfy that they are ready.” (Musisi, 2016).
These two statements prove the sentiment of World Bank towards the Government of Uganda and their Parliament how they spend and allocate their monies. As the structures of the Parliament are not budget-wise or coherent enough to be trusted with foreign money! So they have suspended and shown their acts towards the government who has used the loans as they please.
Here a proof of recent legislation that gave a free pass to the Members of Parliaments and the Government of Uganda how they can act without any supervision. Just read this lines!
As shown by me before in 2015:
“(5a) In addition to subsection (5), a loan raised by the Government as a temporary advance by the Bank of Uganda, which does not extend beyond a financial year shall not require to be approved by the Parliament” (P5, 2015, PFMA).
So if President Yoweri Museveni writes with the sweetest words, this legislations is active and gives way to the Ministries to take out money without filling it in the Ministerial Policy Statement before Financial Year Budget 2015/2016 or any year else as the small term loans can be taken by ‘Ministry for Higher Education and Sports’ can borrow 1bn from Bank of Uganda (BoU) without questions if it supposed to a be short-term loan. And the best it doesn’t have to be questioned the validity in Parliament.
President Museveni forgets that part and that he has created and accepted the loopholes of the economy because the legislation has been servicing him and his cadres. Therefore he feel compelled to write to ask for it and promise to fix it. The World Bank knew he made it happen and therefore seen enough of his ruthless behaviour and his mismanagement of funds.
And if President Museveni took time to read through the reports of the Auditor General John Muwanga and the Inspectorate of Government under the Inspector Government (IGG) Irene Mulyagonja Kakooza has in the recent Financial Year 2015/2016 written staggering amount loopholes and fiscal maladministration. This being that funds that is allocated not paid out on time and also unaccounted funds, even misspent funds in many ministries of the recent budget year 2014/2015. With this in mind, the President should read some of it and make sure they have procedures and will power to create government institutions that works properly.
Instead, Mr. President you have focused more on yourself and the same with the MPs who are greedy and known for seeking their own interest instead of their citizens. In this regard that the President pleas for the bailout World Bank loans are a bit too much for me; this from a man who said this not too long ago:
“I wouldn’t ask these foreigners, but I would never accept these foreigners to give me orders about Uganda. Or about anything in the world! They got their own countries to run. Let them go and run them. Uganda is ours. Nobody gives us orders here” – President Museveni at Kololo Independence Grounds Speech while celebrating the “Double Victory” on 9th April 2016” (Minbane, 2016).
So these man pleas when needing, but acting all bold when rigging the election. As he fixed the economy this way as he has had 30 years to make it this way. This is the powers of being the Executive for so long and he has seen how the World Bank and International Monetary Fund (IMF) do their loans to the governments in the past. I am sure he knows very well as he has been a recipient all his life. That’s why it’s so strange that he accept being told how to run his business now… when they suspend and sanctions his needed loans to run his operation and his government. But when they we’re doing it he could tell them to go to hell.
It is like a moment of Nostalgia when it comes to this. President Museveni pattern are just like this. He continues to counter his own argument from a few months ago. This will happen again, but I hope the World Bank continues to stifle the “Old Man with the Hat”. Because he will one minute speak his peace and offer pleasant gifts, next moment he will be on the war-path and spread venom and after that try to fix it, but usually too late.
But the recommendation from World Bank isn’t a quick fix; it is a systemic change of policy of the economic framework that is there. Something the President already knows very well, as he earns his coins on the system he has ushered in. Peace.
Government of Uganda – Public Finance Management Act (PFMA) 2015
Minbane – ‘Don Museveni says “I would never accept these foreigners to give me orders about Uganda”; Time to cut the direct donor assistance to the government budget of Uganda and after that let Don Museveni eat alone!’ (10.04.2016) link: https://minbane.wordpress.com/2016/04/10/httpwp-mep1xtjg-20m/
Musisi, Fredrick – ‘Museveni sends delegation to plead with World Bank over loans’ (30.09.2016) link: http://www.monitor.co.ug/News/National/Museveni-appeals-World-Bank-over-loans/688334-3399642-g0djk7/index.html
World Bank Group – ‘World Bank Statement on Withholding New Lending to Uganda (13.09.2016) link: https://minbane.wordpress.com/2016/09/14/httpwp-mep1xtjg-3fl/
World Bank Group – ‘World Bank Statement on Suspension of Roads Projects in Uganda’ (08.01.2016) link: https://minbane.wordpress.com/2016/01/09/httpwp-mep1xtjg-1jx-2/