OAG Report put Uganda National Airlines Company Ltd on blast

The Uganda National Airlines Company Limited (Ltd.) was registered in March 2019, but incorporated on the 30th January 2018. That was done with shares both in the Ministry of Works and Transport (MoWT) and Ministry of Finance and Planning & Economic Development (MoFPED). That happened after scrutiny of it was all operating and who was really owning the company.

With that in mind, the statements or quotes from the Auditor General Reports of February 2021 isn’t helping the company either.

As it states this:

Whereas Government had invested a total of UGX 934,840,887,000 and reflected it as an investment in the Treasury records at Ministry of Finance, only an amount of UGX200,000,000 was shown as Share Capital in the company statements, the rest of the amount was shown as Share Application Funds. The processes for recognition of the Government investment in the company have not been undertaken to enable appropriate treatment and reporting in the company’s books of account” (Office of the Auditor General, February 2021).

This here proves the problematic aspect of ownership and hows it still not operative. The Company is still not addressing the “owners” and what sort of role the government have in it. Still, the government is providing funds for it and investing in it. But… we cannot know who is owning it and what percentages the state has. That is obnoxious… and outrageous at this point.

It doesn’t help that this is the current results of the company:

The company was unable to realize its planned revenue, yet the expenditure on operations was way above projected costs. The company only realized US$ 9,985,495 (10.8%) of the project revenue of US$92,863,811. On the other hand, the company incurred expenses that were beyond the planned costs and its actual revenue. For example; the company spent US$29,220,933 on direct costs, US$3,606,965 on indirect costs. As a consequence, the company incurred a net loss of US$27,477,513 in the year” (Office of the Auditor General, February 2021).

The company projections was clearly out of whack, but it also came in a year of the pandemic. So, the help of tourist and tourism to gain passengers went in the wind. However, the company is a pit-fall of money loss and wastage of public funds. They have spent money they don’t have and earned mediocre or nearly nothing while having huge bills. That is not a good way of running business.

It is also striking about who will pick up the bill and who will write-down the losses of this company. As the government involvement and unsure owner structure should make people question whose role is it to pay for the costs, which the company have created last year.

The Auditor General quotes isn’t strengthening the company nor its projections. Only that its a money pit and someone has to cover it. It has a higher burn-rate of cash than what it earns. That is a company running towards bankruptcy. One way or another. The government can save it again. It can save it another time too. However, how much value does it add and what services is the public gaining from such a company?

That is for someone else to answer, but there is no proof of now. That the state or the Republic needs this. It is a vanity project and flying high without money for gas (jet-fuel). Peace.

East Africa Law Society: Public Statement on the Ban of Maize Imports from the Republic of Tanzania and Uganda into the Republic of Kenya (09.03.2021)

Kenya: Agriculture and Food Authority cease imports of UNGA from Uganda and Tanzania

Today, the Agriculture and Food Authority wrote a letter to the Commissioner of Customs, Pamela Ahago. There it stated that it “stopped any further imports of the maize into Kenya with immediate effect”. It also said the reason why: “conducting surveillance on the safety of food imports to Kenya”. The last is: “Test results for maize imported from Uganda and Tanzania have revealed higher levels of mycotoxins that are consistently beyond safety limits”.

When you read that it makes sense. You might wonder, what is mycotoxins? Well, it is: “Mycotoxins are toxic compounds that are naturally produced by certain types of moulds (fungi). Moulds that can produce mycotoxins grow on numerous foodstuffs such as cereals, dried fruits, nuts and spices” (…) “The effects of some food-borne mycotoxins are acute with symptoms of severe illness appearing quickly after consumption of food products contaminated with mycotoxins. Other mycotoxins occurring in food have been linked to long-term effects on health, including the induction of cancers and immune deficiency” (World Health Organization (WHO) – ‘Mycotoxins’ 09.05.2016).

We can be sure that the Ugandan and Tanzanian authorities will react to this. As they will not accept this and will be scorn. The Kenyan Authority is right in doing this. Especially with the concern of food safety and food for human consumption should be key priority. Therefore, to cease or suspend imports of Maize makes sense.

What is also striking is the amount of maize that is exported to the Kenya market from the neighbours, which a report in 2020 said: “Kenya imported 44,740 metric tonnes of white maize from the region in the second quarter of 2020, accounting for more than three quarters of the total grain sold across borders in the period in East Africa. The latest Food Security and Nutrition Working Group (FSNWG) East Africa Cross Border Trade report shows that 58 and 39 per cent of the imports came from Uganda and Tanzania, respectively” (Kevin Rotich – ‘Tanzania, Uganda supply majority of Kenya’s maize imports’ 03.08.2020).

The main importers of maize to Kenya comes from these two. That means the main imports has stopped and the ones who exports it to the Republic. This also means the Kenyans are losing their main sources of White Maize. Maize is staple in the ugali and therefore a vital commodity.

The UNGA is a important aspect and has been subsidized by the government in the past too. We cannot know if the Maize cartels will earn from this. Just like the previous stockpiling exercises in 2017 and 2018. UNGA have been questioned and how the state have treated it.

In June in 2017 CS Willy Bett said this: “Since we started the subsidised programme, we have witnessed more Kenyans preferring unga, thus the high demand for maize flour,” (Ngotho, Agatha – ‘Kenyans eating more ugali to blame for unga shortage – CS’ (20.06.2017) link: http://www.the-star.co.ke/news/2017/06/20/kenyans-eating-more-ugali-to-blame-for-unga-shortage-cs_c1582605?platform=hootsuite).

It might come something similar happening now. As the state is directly losing its key trading partners who exports it to them. It is not like the Kenyans will stop eating UNGA. That is not happening. So, the need for maize flour will persist and we have to wonder where they will import it from now. Peace.

One South Africa (OSA): Optimum’s business rescue plan could open door to more Gupta looting & must be stopped immediately (01.03.2021)

Brexit: Will the Tories tap-out the Bottled Water Industry?

The UK currently has 86 recognised sources which can be used to bottle mineral water and they are located in 61 locations across the country, from St Ives in Cornwall to the remote Northmaven peninsula in the Shetland Islands. Although it is difficult to find out how much this type of bottled water is worth in the UK, it is estimated that the total worth of the sector is £2.7 billion” (Alexandre Nobajas – ‘HOW BREXIT COULD DRAIN BRITAIN’S BOTTLED MINERAL WATER INDUSTRY DRY’ 21.02.2021, Keely University).

The recent letter from 14 Members of Parliament from the Tories are really telling. They have over the weekend on the 27th February 2021 prosed a “Bottled Water” Ban across the Channel. Do a trade-war-esque move. They sent this to Lord Frost, the newly appointed Brexit Minister and Chief Negotiator with the European Union. It is deliberate act to show some force in concern with the hurting shellfish industry.

However, the United Kingdom and Tories could easily see the ramification of leaving the EU. They could have studied and known what happens to trading parties who becomes a third country. What happens to certain industries and how these operates in concern to Brussels. Still, the Tories didn’t think of this, even if they were warned by industry ahead of the withdrawal. Because, the principals was more important than the reality on the ground.

The same is here with the Water Bottle Industry too. The Mineral Water and Distilled Water will hurt a billion pound industry. A industry with mostly rural bottlers will be hit by this. Just like rural producers and fisheries who made shellfish. If the Tories block EU Bottle Water like Evian. Who believes Brussels will care about bottled water from Scotland or Wales?

They will be banned entry too. The EU will not allow their own industries has a disadvantage. The member-states will not allow bottles entering from Wales to compete with French bottled waters in the Netherlands, but not being allowed to sell bottled water in London. That will not happen and the EU will strike back at London.

Therefore, if Lord Frost and the Tories are doing this. Then they will put the smaller bottlers dry. These who sells a lot of their stocks of bottled water to Europe will loose their profits and possible export market. That is just the reality here.

The European counterparts has a huge market to survive in anyway. They can compete there and get it through all of their member-states. The European Common-market is big enough for the producers. Yes, it is a loss to not sell in the UK, but that will not damage the bottled water industry at such an extent.

The rural bottlers in the UK will most likely have much more to loose, than the European exporters to the UK. Even if the Tories believes differently… the EU will not change their common-market rules and the UK as a third country have to comply. The bottled water industry is yet another looser, if the UK pulls this stunt.

The bottlers in Scotland and Wales will loose vital markets and the Tories will destroy another industry. That will make these water-wells run dry. If not they have to make the British drink more bottled water, instead of drinking it directly from the tap. Peace.

The State propose a 0,5% Cash Withdrawal Tax (!)

The Ministry of Finance, Planning Economic Development (MoFPED) is preparing a tax on every cash withdrawal from ATMS or Commercial Banks. This means every time someone takes out cash from their accounts. The customers i.e. the citizens have to pay the state a fee to access their money. Just like they do with the mobile money transactions. That’s why the state is proposing this.

This is an easy way to access more funds without adding any value to the monetary market. The state will not do anything, but adding a fee. A percentage on every single transaction. In the meanwhile, they will also deplete funds from the citizens. As the citizens have to calculate every transaction to ensure they are paying less taxes. That is what people does when they want to ensure they get most value out of the money. Which will be standard.

The manner of doing this. Is in a state where there is already lots of cash and money in circulation. The Republic is built with cash based economy and need for cash itself. That is why in some ways this will even be a double tax. Especially for the ones having first mobile money transfer to family members and loved ones. They are first paying a fee to send it too them, which is the Mobile Money Tax. Then the person receiving the Mobile Money will have to pay either at a bank or at ATM the Cash Withdrawal Tax. In this way the state is getting paid twice before the money is even getting in circulation.

I wonder, if the MoFPED have thought of the consequences of this? Has the state considered the implications for the citizens? Or are they only trying to figure out new ways to cash in on every citizens. So that their behaviour and need for money will cost them.

Because, it is normal that foreigners or aliens are paying to take out money at a ATM abroad. They usually pay a transfer fee between their currency and the Ugandan Shilling. That is making sense and the bank also takes a fee for doing so. A tourist knows this and accepts it, as it is a way of easily access and securing local currency. However, what the state is proposing is paying a tax to access your own money.

The state is billing people for withdrawal of cash. In essence the state will take money for service rendered for printing money. They are billing the public for having circulated coins and bank notes. Since, they are taxing every transaction and that’s really ill. This sort of enterprise isn’t growing the tax-base, but taking away more funds from circulating. The more you tax, the more funds you are depleting from the system. In the end you have a evil circle where all taxes are overburdening the citizen. In such a manner, that they start to do all business and transactions on the black-market to save money. That is when the state loses out and cannot access these transactions at all. This because they have found other means of moving money and doesn’t want to pay added taxes on their needed funds.

The more these taxes are put forward. The more funds are taken away from the ones who needs them. This is all taken away from the citizens before they get to access the money. Either it is mobile money or taken from their account through a withdrawal. That should worry the Representatives and the ones making laws. The amount of 0,5% doesn’t sound like a lot, but imagine that on every single transaction or withdrawal. That will be huge sum and be a costly endeavour. Peace.

Brexit: The Tories knew shellfish exports would be troublesome

Deepdock director James Wilson said that the consequences of this are that when the UK leaves the EU, we become a third country, and so are no longer considered to be immediately compliant with single-market requirements. The single-market issue – part of the suite of so-called non-tariff barriers to future trade – is likely to be the largest disruptive influence on the flow of trade from the UK into the EU” (…) “He said they had been concerned since the referendum result, and had engaged with the UK and Welsh governments throughout this period. They had expressed concern to the Welsh government, DEFRA and the Food Standards Agency (FSA) many times, but had been told, “It will be fine.” The administrations finally acknowledged that there was a problem more than a week after the original 29 March Brexit deadline. “We were floored by the news,” said James Wilson” (Tim Oliver – ‘EU mussel exports threat’ 20.05.2019, Fishing News).

The Conservative Party and Her Majesties Government in London seems baffled. They seems rattled and shocked that the Brexit has consequences. It seems like they thought it would be easier and less hurdles. However, with the Withdrawal Agreement and Trade Agreement in place. They are out of the Single Market with the European Union (EU) and that affects trading between the UK and the EU.

Now, that the fish is rotting from the head. We are now just over a month into the new game-changer. The lovely days of being a Third Country. The effects and touches of being outside is happening. The businesses are being touched and the exporters are feeling a whiff of new paperwork to issue before sending cargo across borders. The UK exporting businesses has been hit and non other then the fisheries.

The Fisheries which was so important. One part of the fisheries are the fish-farms and the ones selling shellfish or mussels. These are being transported fresh or frozen from rural areas across the UK to the European Union (EU). That was being done for years, but things changed when the UK turned into a “third country” as there are new obstacles for this industry as a whole. When you go into “Online Trade Tariff” on GOV.UK you can check the various of mussels, but there is no export measure between the markets in place of 8th February 2021.

That is why its really outrageous that Tories think they could be selfish and not follow their trading partners standards, which is pre-fixed with their agreement. That seems lost on the likes of George Eustice and the Tories who blames the EU for having regulations for “Third Country” nations. Alas, a worry that they was warned about from the producers, which they told “it will be fine”. Which by today is proven it is not.

Paul Armstrong reports: “A leaked email to the website Politics Home showed that The European Commission last month wrote to the UK shellfish industry informing it that un-purified oysters, mussels, clams, cockles and scallops caught in those waters were banned from the EU indefinitely since the UK left the Brexit transition period on New Year’s Eve” (…) “Martin Laity director of Sailor’s Creek Shellfish in Flushing says the news sounds the death knell for his business and the 52 fishermen and women he had to lay off over at the beginning of the year because of Brexit” (Paul Armstrong – ‘Oyster fisherman Fal Estuary EU shellfish ban’ 07.02.2021, Failmouth Packet).

The businesses is already hurting and its proven to be so. The EU isn’t selfish… but the UK wasn’t ready for the boundaries of the shellfish. The UK should have been prepared for the obstacles and the issues with becoming a “third country”. They are not apart of the single market anymore and has to comply to other rules. That is the reality of it all.

The UK is now a fish out of water. It is really struggling to comprehend the new reality and thinking they are special. However, the UK have to follow the regulations and standards, which is now operative from 1st January 2021. It seems like they thought things would be like before. Nevertheless, they had the warnings… but they didn’t listen to the industry itself.

The Tories knew and they was getting words from the industry. Still they didn’t comply or consider the implications of the Brexit. Now its a reality … and the shellfish is rotting in the port. Because of the arrogance of Whitehall and the Tories itself. Who knew that this could happen, but now want to through a hissy fit at the European Commission for not preparing properly for the shellfish industry. That is why they in a sea of trouble…. Peace.

Zimbabwe: ZANU-PF – Press Statement (03.02.2021)

Uganda: Deficit financing is creating an evil circle financially [72% of revenue spent on debt repayment!]

By implication, if sh15.7 trillion for debt service-related expenditures is subtracted from the sh21.9 trillion the Government will have generated in revenue collection, it means that 72% of the country’s revenue collection would be spent on debt repayment. The committee raised concern that the high rate at which government is borrowing is not commensurate with the low level of increasing government revenue collection and, therefore, violates the country’s charter of fiscal responsibility. The report indicates that as of June 2020, Uganda’s public debt had reached $15.27b, which is equivalent to sh56.9 trillion. Out of this sh38.9 trillion is external debt and sh17.9 trillion domestic debt” (Moses Mulondo – ‘Govt earmarks sh15.7 trillion for debt repayment ‘ 03.02.2021, New Vision)

The news on how the state got to repay old loans is coming out. As the Ministry of Finance, Planning and Economic Development (MoFPED) have put forward the budget for the Financial Year of 2021/22. This is initially telling stories on the revenue or tax base, which will be preoccupied or used for paying debt repayment.

Just to put things in perspective. This is the definition of ‘Deficit Financing’:

Deficit financing, however, may also result from government inefficiency, reflecting widespread tax evasion or wasteful spending rather than the operation of a planned countercyclical policy. Where capital markets are undeveloped, deficit financing may place the government in debt to foreign creditors. In addition, in many less-developed countries, budget surpluses may be desirable in themselves as a way of encouraging private saving” (Encyclopaedia Britannica – ‘Deficit financing’ (25.08.2015).

This here is telling the story, which the state media and others isn’t telling. Because, they are borrowing funds to cover up for the deficit. The deficit is created as a result of the rising cronyism and misuse of funds. These funds have to cover the bloated government and its staff. That is why deficit is created to fix the shortfall between the needed revenue and the expenditures of the state. They are using loans to cover and fix the lacking revenue of the state. If the state had enough funds through its tax-base, the state wouldn’t need these loans in the fist place.

However, the state have prolonged with this game over years. The state has used loans to cover its baseline and usage of funds. They have went out for foreign creditors to get enough funding. That shows that the state haven’t been fiscal responsible. They have misused the authority of the state and taken up loans, which now accumulate to over 70% of yearly revenue. While this is happening. The state and the Parliament is still issuing new loans and creating a bigger debt burden. That is what they are doing… and that cycle must stop.

Soon, all revenue will go directly to debt repayment. We know the state wants to have debt relief, but this is self-created by the regime, as they are borrowing for basic commodities and necessities. They are always loaning funds to build development projects and infrastructure, which will be costly. As funds are lost and misused in the building of these. That is why the price of road is so expensive and also projects in general. Therefore, the state is crewed over more than it can swallow.

That is why the state is deficit financing and its become a burden, which it cannot carry. The debt is not sustainable. When 72% revenue is spent on debt repayments. That shouldn’t be a thing, but that is fiscal policy of this regime and apologist cannot hide the fact. They have run down the state and taken up loans they cannot carry. Peace.

Opinion: Museveni suspending the DGF is biting the hand that feeds him

Now that the letter from President Yoweri Kaguta Museveni to Minister of Finance Matia Kasaija is out. The infamous letter where he suspends the accounts of the Democratic Governance Facility (DGF). This is important, because the DGF supports programs and organizations across the Republic. The DGF is sole funder of several of civil society organizations and non-governmental organizations. There are atleast 70 of them that is hit by this and would cease operations, as the funding and lack of funds to pay staff. That is all happening, because Museveni wrote a letter in early January 2021.

President Museveni have targeted CSOs and NGOs around election time. That is common. That he claims they are up to “no good” and supporting “terrorism” or any other objectively bad enterprise they can. That has been common for decades. However, ceasing their funding totally and blocking a multi-national funding scheme like the DGF. Only undercuts the ideals of the givers, the donors and the ones who monetary support the government and people in the Republic in general. This isn’t government funded money from the tax-base. No, these funds are given from outsiders to support governance and other organizations to strengthen democratic institutions and educate the masses.

The DGF is a collective fund donated by the European Union, Austria, Denmark, Ireland, Netherlands, Norway and Sweden to support programs and CSOs/NGOs in Uganda. They are partnered with at least 72 organizations across the republic to different capacities. All working in various of fields and for causes to better the Republic. They are all civil society voices for good governance and creating a freer society. However, that is clearly not the beacon that the President believes in anymore.

The donors that see this action by Museveni should shun him and cease all direct donor-funds and also block all loans through multi-national organizations, which the donors are funding as well. That would make it harder for the President to operate and he would seek funds elsewhere. If he wants to be free of stipulations and not have any oversight. This cutting funds to International Monetary Funds (IMF) and World Bank (WB). Also others where the Government of Uganda is seeking loans for development projects and government programs.

The National Resistance Movement was able in the late 1980s and 1990s to have progress and financial backing to pursuit the government programs, which is it so proud of. The state also saw debt relief and cuts from donors. Now, the NRM is gaining more debt, but also putting in obstacles with the donors in regards to the DGF. The ones funding DGF should suspend all other funds and funding that goes towards Museveni. As a retaliation to this, as these projects, programs and NGOs/CSOs are working for ideals that Museveni once stood for, but with lingering in office despises.

We are clearly seeing the punitive action made by Museveni. He wants to prove supremacy, but does it in a mockery of a way. This is only showing the donors what sort of little man he is. That he has to go to this step. Take away the securities of the CSOs and NGOs. Instead of actually serving the general public. If the President really did that. He would haven’t have the need for all these CSOs/NGOs to cover where the government is lacking. The state is fluid and lacking institutions. That’s why the state needs them to cover the basics and civic education. This is still needed after over 30 years in power. That shows the weakness of the Presidency and his reign.

President Museveni isn’t showing strength here. His showing weakness and lack of control. That he got to act like this. This is acting a villain and hurting own citizens, because he can. So, the donors should act upon this and not just take it on the chin. They should show force too. Just to prove him what he has done. It is about time and not just “condemn” and move-on. That is not making any changes or challenging the old man. You need to meet him head-on. He plays games and these are with the lives of all these organizations. It is not the money of Museveni and neither funding from the state either. That is why his sour, as he got to loan to pay his cronies salaries. This is why he attacks and confronts, instead of talking and negotiating with the donors.

What he does with this is putting himself in corner and making less friends. If he wanted more support and legitimacy. He should have acted differently. However, he rather picks the trick of the pariah, instead of the friendly grand-pa, which is what he tries to act in the media. That is clearly not working and that is why this letter is undressing his motives. Peace.