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The Uganda Budget Framework Paper FY2018/19 for Energy and Mineral Development is saying that the External Financing is the key for this Sector – Period!

The Budget Framework Paper for Financial Year of 2018/2019 for the Ministry of Energy and Mineral Development is really revealing how the financing of the sector is and how the state is involved with the manner. Also, how low-key the main factors are and lacking transparency is hitting the Energy Sector of Uganda. Not that is surprising, since the agreements, the licenses and the tenders are usually kept behind closed doors.

However, the main part of the Framework Paper is evident of the issues at hand:

The indicative budget ceilings for the Ministry of Energy and Mineral Development have been rationalised in line with the sector priorities and national priorities as communicated in the Budget Call Circular and in the Presidential Directives. The ceilings for Vote 017 for the FY 2018/19 are as follows: Wage Recurrent is UGX 4.23Bn; Non-Wage Recurrent is UGX 74,04Bn; GoU Development is UGX 307,84Bn and the Development Partner contribution is UGX 1,608.41Bn. Under Vote 123 ceiling is UGX 81.98Bn is for the GoU Domestic Development and UGX594.00Bn is from external financing” (Energy and Mineral Development, Budget Framework Paper FY 2018/19, 2018).

The building of vital infrastructure, the refinery, the pipelines and energy production facilities are all dependent on funding from abroad. If it is grants, loans or paid-in-full agreements done in secrecy. Because, there are more than the shadows of this budget framework paper. It is saying a lot and the votes for the future is showing the future too. That the Ugandan economy is prospering, as the budget are needing all funding from afar to be able to build needed infrastructure. Also, needs the grants for the Rural Electrification, the ones who the state has even borrowed to do.

Therefore, this Budget Framework Paper is showing the troubles ahead. This isn’t voting for better economy, know this is dependency and also proving how much the donors and partners are involved in making sure the economy gets addicted to it.

When it comes to the refinery, the details are clearly still in the wind: “The process of selecting of the Lead Investor is still progressing and the negotiations are ongoing between Government and the selected investor. The process is expected to be completed in FY 2017/2018. There after FEED and ESIA for refinery development will be undertaken with the Lead Investor on board” (Energy and Mineral Development, Budget Framework Paper FY 2018/19, 2018). So the selecting of it is not finalized, well, for some thought Russians had secured agreement and the reason for Museveni to visit Moscow. Clearly, that ship has sailed, we can wonder if Total or any other company would do this. As Total has the biggest chairs of licenses in the Lake Albertine Basin. Time will tell, but another proof of lack of transparency, when the Ministry has to write this.

Procurement Bottlenecks including lengthy bidding processes that require no-objections from the external financiers at each stage of execution. There is need for PPDA to revise guidelines for procurements relating to flagship projects. In addition, the following measures need to be considered: financing agreements are signed, project is almost ready to kick off. PPDA should reduce the administrative review timelines that sometimes stall progress” (Energy and Mineral Development, Budget Framework Paper FY 2018/19, 2018).

This here is initially following the guidelines of the First Amendment of the 1995 Constitution of 2017, the Land Amendment that the National Resistance Movement put forward before the Age Limit. That would fit the narrative of the Ministry and their wishes. It is like reading the same idea, to give more power to the state and able to land issues quickly.

What we can learn, also and which is important, these developments, these infrastructures projects couldn’t have been built if it wasn’t for external loans, externals grants or direct aid, if not on the license fees and the parts that is taxed. However, the grand amount and the majority of the projects needs the external funding.

This is not surprising, it is to be expected because Museveni doesn’t want to use his money. He want to spend other people’s money and also the money of the future. To benefit him today, that is why the deals are done in the secrecy…. We don’t know the reasons and the value of the licenses, the ones who is to build the refinery, even the grand agreement between the Corporations who will build the Pipeline. We know that certain companies has failed to build the dams and used bad material, but that is because of the Chinese Contractors has saved money, while being paid-in-full.

President Museveni blessed that deal and got scraps back. Time will tell, but this isn’t a good look. Not because I want it to be bad, but because the money says so. Peace.

Opinion: Have Kagame put a spell on the West?

You can wonder if the sins of old haunts the West, if the support and the strategies that worked back-in-the-day is now a lost tale. The hope for change and for a different outcome is gone. President Paul Kagame will run indefinitely and never step down. I don’t know if the West feel in debt for the crisis it didn’t prevent and didn’t manage properly in 1994. Where Kagame together with the rebel-militia supported by President Yoweri Kaguta Museveni entered Rwanda. They had already been apart of the National Resistance Army (NRA) and the new government under National Resistance Movement (NRM). Kagame has done the same with the Rwandan Patriotic Army (RPA) and made it into a party with the Rwandan Partriotic Front (RPF). Just after the model in Uganda.

Therefore, what you see in Rwanda is similar to what you have seen in Uganda. However, there are difference, that is why the chilling relationship between the neighbors. Kagame has worked closely with Uganda, they have sent armies together in the Democratic Republic of Congo, they have worked together to support the M-23 there too. They have been weapon brothers and brothers in arms. Still, the West let them both go. It is weird, but that is where we are. Both Museveni and Kagame can do whatever and get away it.

Kagame is either detaining or killing his enemies. He is doing it just like the Russian do. Rwandans has been poisoned in the United Kingdom, strange fatal accidents in South Africa, even in exile there are dangers if you have crossed Kagame. No-one is hidden from him and if they did him bad or even questioned him. He will find you and make sure you pay. Everyone can be touched and everyone can be taken.

Kagame has total control, nothing that he doesn’t have a stake in, there are clear that the state is part of all society. If there a dissidents or people questioning him, even if they are challenging him in public. They will be tarnished and detained, their family enterprises will be seized. There is no mercy and he never shows that to anyone.

That is maybe why the Western media, NGOs and States in general are walking on needles, they need the minerals he is thieving from the Kivu provinces and therefore, let him off the hook for the support of militias within the DRC. Let him of the hook for the human rights violations, for the killings of opposition and for the totalitarian activities. Where no one but his will matters. Kagame is the king and the sun first shines on him.

We should be worried, because he doesn’t lack use of violence and harassment, he hurts and kills. He might be successful to a certain extent, but we should be worried about the efforts and his involvement across the border. There are even claims of his use of spies and such in Burundi. Clearly, that could be the truth, since he has used all sort of manipulation and militias to get funding from abroad. Therefore, it is weird he is a donor friendly person, but also someone who has no issues with silencing his enemies. That should be worrying and that should cut him off the gravy-train, also sanction the companies that are importing his conflict minerals. Peace.

Opinion: UK’s Environmental Audit Committee wants to introduce “Latte Levy” on the consumer, however, what if the government added policies and taxes that hit the companies instead?

Mary Creagh MP said:

A reusable cup is one of the easiest ways to reduce cup waste but the discounts offered by coffee companies are ineffective. The plastic bag charge is proof that charges are highly effective at reducing packaging waste. We urge the Government to introduce a 25p charge on disposable cups.” (Parliament.uk, 2018)

Since last year the Environmental Audit Committee (EAC) have worked on finding ways to make the Coffee industry in the United Kingdom more environmental and more sustainable. Since the one-time use of Coffee-Cups from the big international chains is a disaster to recycle and creates new levels of garbage. It is natural that this is looked into as much as other beverage and use of plastic to contain the liquid in ordinary trade. The EAC should look into the beer and soda industry as well, since they use one-time bottles of plastic that also hurts the environment.

What was striking was the recommendation from the EAC:

The Committee has called on the Government to: Introduce a 25p “latte levy” on disposable coffee cups, and use the money raised to improve the UK’s recycling ‘binfrastructure’ and reprocessing facilities. Set a target that all disposable coffee cups should be recycled by 2023. If this target is not achieved, the Government should ban disposable coffee cups. Make producers pay more for packaging which is difficult to recycle. Improve labelling to educate consumers about how best to dispose of their cup” (Parliament.uk, 2018).

That the “Latte Levy” is coming up is a good idea, but also already could be enforced directly, as the chains to make it more costly for each cup of one-time usable cups. Since, that would make more people aware and also bring cups for the chains. Even sell more cheaply the reusable cups and make offers that are reasonable for the consumer of coffee. Instead of adding more tax on the ones buying coffee on the run to and from works at the coffee shops.

If the government wants the consumer to use reusable cups, they should put in conditions not only to hurt their pockets with a latte levy, but also make it profitable for Coffee shops and Coffee chains to earn more bucks on their sales of this. They are only in the market for the profits, not for saving planet earth. Than the government has to put forward demands and laws that put restraint on the sellers to provide with cups, which actually are recycled or reusable with a fair price.

That the government would put extra pay to extend and make sure the cups are recycled is a good enough idea. To recoup and make sure they can facilitate garbage disposal that fits the one-cup use of the modern day at the coffee shops. That the industry should reshape and change is natural. But they will only do so, if they earn money on it or have to comply with new regulations. That is if the Conservative Government wants to direct and change the policies affecting the industry and their behavior. The consumer will look at price and convenience, so they will use the best options concerning their needs and daily life.

What the “Latte Levy” does is only to make the coffee a bit more expensive, but doesn’t do enough to change behavior or either consumer nor companies. That is what the target should be. The Companies should be affected for their use of one-time use cups and the trash it creates. Peace.

Reference:

Parliament.uk – ‘MPs call for “latte levy” on coffee cups’ (05.01.2018) link: http://www.parliament.uk/business/committees/committees-a-z/commons-select/environmental-audit-committee/news-parliament-2017/coffee-cups-report-publication-17-19/

Opinion: You know that Kagame didn’t really win with 98,66% when he has to intimidate Rwigara!

I know I will shot-out of the gates and say that Paul Kagame, who won with 98,66 % in the Presidential Election in August 2017. Didn’t really win by that margin and have that sort of support. For some this might be controversial, others saying I’m hater. I will take that any part of the day and close my eyes in content. Kagame didn’t win by that margin and he didn’t have that massive support.

For the simple reason, ever since the election he has had to silence Diana Rwigara and her family. Latest stint was in Court this week. She has been arrested on unknown locations and been taken away from home. Why is Kagame so afraid of Rwigara? Well, he is afraid of being questioned and having real opposition. That is because Kagame does whatever he can to have none. The ones who has been is either in exile, detained or gotten the arrested for treason against the state. That means they don’t have loyalty to Kagame or his almighty Rwandan Patriotic Front (RPF).

If the President was a legitimate executive and head of state, he wouldn’t have cared about the candidacy of Rwigara. She wouldn’t have the party-organization or even the structure to compete. It would be like Jill Steins Campaign in 2016 in the United States. She would be a part of the race, but all the eyes would be on Clinton and Trump. It’s not like Frank Habineza of the Democratic Green Party of Rwanda has a size, neither independent Phillippe Mpayimana. If the playing-field between the candidates was fair, they would have gained more popularity, but they are just needed props into the sham of an election.

That Forces Democratiques Unifiees (FDU-Inkingi) is not involved and other parties are not in the elections. Proves my point, that the mere sacrifice of Kagame to run again. Is mere a sham and his own rule is not on popularity, but on fear and oppression. If he was democratic he wouldn’t fear Rwigara and throw phony charges her way. He wouldn’t make a mockery of her family and associates. But he has too, because his popularity isn’t as soaring as he tries to make believe.

President Kagame, don’t have stomach or the bravery to play fair, because he came with the guns and will be like many before him. Only leave by the gun. He is like Rwandan answer to Museveni. If you have real competition, they either end in exile or they are treasonous against the state. Just ask the Ugandan opposition about their toils and intimidation.

Rwigara case is proof that Kagame don’t have the popularity he subscribes. He don’t, if he did he would never step beneath his office and done this to his citizens. But he has too, because he don’t have their support. The only way he keeps the system intact is to spread fear and intimidation. That is why he is charging and shaming Rwigara for opposing him. Peace.

Opinion: President Museveni praises Equatorial Guinea for it’s rampant Oil-Corruption; wants to learn his tricks!

In these days the President Yoweri Kaguta Museveni of the Republic of Uganda are on a state visit in Malabo, visiting and learning tricks from the Equatorial Guinean President Teodoro Nguema Obiang, who has used the oil to enrich himself and his loyal subjects. Not build a welfare state, but make sure the family of Obiang get wealthy. Certainly, Uganda is preparing for their own oil production in the Lake Albertine basin, as the pipeline building from the production to the Port Tanga in Tanzania.

This is why President Museveni are visiting Equatorial Guinea to learn the tricks of the trade, as the state of Uganda are still in the dark of the oil-deals between the international companies and the state. We can wonder how the funds will be spoiled and how Museveni plans to use the oil funds for personal gains. If so, he wouldn’t praise President Obiang, who has his whole career to spend the oil profits from his republic. This is what Museveni wants to learn, since his career has been tricking out all sorts of play from Ugandan republic. The petroleum profits can be misspent and hidden just like in the republic of Obiang. Take a look!

President Museveni’s praise:

We are therefore in Equatorial Guinea for two things: looking at how to support prosperity of one another and how to push for our strategic security. I also congratulate Equatorial Guinea for using it’s oil and gas very well. When I was last here for the AU Summit, I noticed gaps between the airport and the city centre. Today, all these gaps were gone. In their place are new, well-planned buildings. And I see the city is refurbished. Some people say oil is a curse but in Equatorial Guinea it is a blessing” (Yoweri Kaguta Museveni, 26.08.2017)

Business in Equatorial Guinea:

Since the discovery of the offshore oil deposits, many investors have shown great interest in the country. Foreign direct investment inflows into the country had thus been consistently high for the past years. Nevertheless, in 2016 the FDI inflow amounted to USD 54 million, a sharp decrease from USD 233 million recorded the previous year (and the historical peak of USD 2.73 billion in 2010) . The total stock of FDI in the country is currently at USD 13.4 billion” (…) “Corruption in particular is problematic. In addition, the business climate of the country remains rather unfavourable for investment. Cumbersome procedures and high compliance costs slow licensing and make starting a business more difficult. Weak regulatory and judicial systems may discourage foreign investment as well, along with high credit costs and limited access to financing. The government controls long-term lending through the state-owned development bank. Equatorial Guinea ranked 178th out of 190 countries in the 2017 Doing Business report published by the World Bank, losing three spots compared to the previous year” (Santander Trade, 2017).

Son of the President on trial:

The corruption trial of Teodoro Nguema Obiang Mangue, the son of the president of Equatorial Guinea, ended in Paris on 6 July with the prosecution calling for a three-year jail term, a €30 million (US$34 million) fine and the confiscation of assets. The Tribunal will return a verdict on 27 October. The 48-year-old vice-president of Equatorial Guinea was not in court to hear the prosecution’s claim that he used money stolen from his country’s treasury and laundered through a shell company to fund a lavish lifestyle in France” (Transparency International, 2017).

This was what that is well-known of the Equatorial Guinea corruption and the son of President has also had challenging cases in the United States. Now the son is also having alleged fraud and criminal charges in France. Clearly, the Ugandan President has already known for corruption behavior. Therefore, even a state agency of PPDA has some words, that the government needs strict regulations before procurement and infrastructure development. This will be clearly important when it comes to petroleum industry. Take a look!

PPDA strict regulation on public procurement:

Public procurement is a key pillar of the public financial management system. The country’s budget and plans are translated into actual services to our people through the public procurement system. It is also the link between the public sector and the private sector as it is the medium through which the private sector does business with Government. Public procurement therefore involves large sums of money and as our budget grows with the priorities of Government remaining infrastructure development, the proportion of the budget earmarked for public procurement remains significant and therefore calls for strict regulation” (PPDA, 2017).

Audits and investigations by the Public Procurement and Disposal of Assets indicate that corruption in the procurement process manifests more in the evaluation of bids, reported to be at 58%. PPDA’s Manager Capacity Building Ronald Tumuhairwe says such corrupt practices lead to awarding of contracts to incompetent individuals hence shoddy works in several government projects” (…) “He adds that the second process where corruption manifests is awarding of contracts at 12.5%, followed by receipt and opening of bids, reviewing evaluation of bids, advertising and signing of contracts” (Sebunya, 2017).

President Museveni clearly has own agencies saying it is important with strict regulations on procurement and infrastructure developments like the ones needed for oil industry in the republic. The regulation of oil industry is lax, to make sure the state isn’t transparent with its profits and taxation of the industry. This is what Museveni wants, that the state and the public doesn’t know the contracts or the agreements between the parties involved. That is something President Obiang surely have the capacity to teach Museveni. And how to make sure his family is earning from the state resource, instead of the public and the state itself. Peace.

Reference:

Transparency International – ‘ON TRIAL FOR CORRUPTION: FRENCH PROSECUTORS DEMAND JAIL TERM AND €30 MILLION FINE FOR OBIANG’ (11.07.2017) link: https://www.transparency.org/news/feature/on_trial_for_corruption_french_prosecutors_demand_jail_term_and_30_million

Santander Trade – ‘EQUATORIAL GUINEA: FOREIGN INVESTMENT’ (August 2017) link: https://en.portal.santandertrade.com/establish-overseas/equatorial-guinea/investing-3

Sebunya, Wycliffe – ‘Corruption manifests most in the procurement process – IG’ (25.08.2017) link:http://radioonefm90.com/corruption-manifests-most-in-the-procurement-process-ig/

PPDA – ‘EVALUATING INNOVATIVE ANTI CORRUPTION POLICIES IN PUBLIC PROCUREMENT IN UGANDA’ (02.08.2017) link: https://www.ppda.go.ug/evaluating-innovative-anti-corruption-policies-in-public-procurement-in-uganda/

Opinion: President Kagame won with 98.66%, just like his predecessors Kayibanda and Habyarimana!

Its been 17 years of RPF rule and will be 7 more years with President Paul Kagame. The ones that thought differently has lived under a rock and thought the whole world would stop spinning. The world stop and the hearts would stop pumping if there was a different result at this point. This was massaged and made ready for the world. The whole campaign and the race to the polls. You don’t manage a race of significance and get 98% by coincidence, that is measured and made sure off. Just like the Presidents before him.

Incumbent President Paul Kagame took a major early lead in Friday’s presidential polls with 5,433,890 votes (98.66 per cent) of the total votes counted by 12:30am. By press time (around 1am), the National Electoral Commission had managed to count about 80 per cent of the votes cast (5,498,414 votes) from 1,732 polling stations. There were 2,340 polling stations across the country. Independent candidate Phillippe Mpayimana was in a distant second having just garnered 39,620 votes (about 0.72 per cent). Frank Habineza, of the Democratic Green Party of Rwanda, trailed with a measly 24,904 votes, which is 0.45 per cent of the votes counted” (Mwai, 2017).

Because if looks into the Rwandan election history, it is not like the history isn’t telling of similar elections like the one seen this week. Not like the Republic of Rwanda has different results. If you go back to voting on the monarchy in September 25th 1961, if the Kingdom should be preserved it got 78,5%. So the people abolished it 1961 and the other ballot if the King Kigeri V to remain king or had to abdicate, the result that day was 79,60 % who voted him to become a civilian. So even in the 1960s the now Republic voted in high numbers for one thing.

The President George Kayibanda was voted for in 1965 election and he was elected unopposed with 100% support. The same happen in 1969. When Kayibanda was reelected. Then again it took sometime before the next election.

In an unopposed election of President Juvenal Habyarimana in the 24th December 1978, where he got 98,99 %. Again on the 19th December 1983 he got reelected and was unopposed who got 99,97%. The third election with President Habyarimana, again went unopposed on the 19th December 1988, that time he got 99,98%.

After that, there been lots of issues and the civil war, that ended in genocide in 1994. When the Rwandan Patriotic Army (RPA), who became the leading party Rwanda Patriotic Front. In the first Presidential election after the genocide, it was in 2003, when President Paul Kagame got 95,05%. So 7 years later in 2010, the incumbent President got 93,08%.

Now in 2017 and unleashing yet another term for the Rwandan President, who follows his predecessors. The ones that was overthrown and killed. These took so much control that they created a violent legacy. Certainly, President Kagame doesn’t want that, but he is following the footsteps of the leaders in the past. Nothing with is different from them, just another name and another time, but with the same controlling state and dark secrets. Kagame got this year 98,66% in the Presidential Election in 2017. Which, is very much alike like Habyarimana, who was shot down while flying in the 1990s. While the death of Kayibanda is still unknown. Therefore, if Kagame follows his predecessors it will end in genocide and a horrible assassination.

Not that we wish that, but the history repeats itself, as seen with the election and state control of society. As well, as internal affairs are controlled from the state. To way that even banished the World Bank from studying the poverty and analyze it to create programs to fight it. This was because the Rwandan state wanted to control the numbers and make sure the propaganda was fitting the vision of Kagame. Therefore, nothing is surprising.

That Kagame got 98% in the election was waited, just like the generations in the past expected Habyarimana and Kayibanda to win with overwhelming numbers. It is all repeating itself and going in circles. To overlook that is to be blind and trying to overshadow the history, which is the propaganda of the state. But that is to be expected. Peace.

Reference:

African Elections – ‘Elections in Rwanda’ link: http://africanelections.tripod.com/rw.html

Mwai, Collins – ‘Kagame wins presidential poll’ (05.08.2017) link: http://www.newtimes.co.rw/section/read/217433/

OAG Muwanga explains in two reports problems and errors within the Petroleum Industry!

The Auditor General has two reports on the Petroleum Industry and the issues of Petroleum Data and the Petroleum Fund. The errors of the state, the PAYE of the tax to URA. Proves that the monies earmarked for the Petroleum Fund, ends up in the Consolidation Fund. This is proof of the problematic use of the added taxes before the oil adventure really takes off and the drilling of the explored blocks in the Lake Albertine Basin. Where already different international companies have come to drill and the state is making a petroleum pipeline to Port Tanga in Tanzania. Therefore, these vast resources and possible taxes created by the industry and within the Republic. Still, the default problems that the Auditor General address can be fixed. It is just a matter of morals and actually following guidelines. Some are even set in the Public Finance and Management Act of 2015, so if for instance URA follows it, the problems of transactions into wrong fund can create payment arrears and also future problem of spending by the state. Since the misuse of funds and taxes can be allocated to other than what they was expected, as the Consolidation Fund has other uses than the Petroleum Fund. Just take a look!

Petroleum Fund:

For the six months ending December 31, 2016, the Fund received non tax revenue worth UGX 922,348,854 (USD270,900) as surface rental fees from Tullow Uganda Operations Pty and Total E & P Uganda” (OAG, P: 7, 2017).

It was however noted that monies collected by Uganda Revenue Authority (URA) under the income tax on income derived from petroleum operations such as PAYE, VAT and WHT is not being remitted to the Uganda Petroleum Fund. This contravenes the Public Finance and Management Act 2015” (…) “In their opinion PAYE is not tax charged on income derived from petroleum operations but paid by the employees and as such it had been excluded from the definitions of petroleum revenues. Arising out of the above it was established that UGX.l1,390,530,053 collected through the commercial banks and remitted to the consolidated fund should have instead been transferred to the Petroleum Fund. Management has promised to remit it to the Petroleum Fund before closure of the financial year 2016/17” (OAG, P: 10, 2017).

During the period under review, the fund received USD 270,900 (Two hundred seventy thousand, nine hundred dollars) in respect of surface area rentals consisting of USD 113,400 (One hundred thirteen thousand, four hundred dollars) paid by Total E& P Uganda for the development areas of Ngiri, Jobi-Rii and Gunya and USD 157,500 was paid by Tullow Uganda Operations Pty Ltd for development areas of soga, gege, Kasemene, Wahrindi, Nzizi-Mputa & Waraga, and Kigogole- Ngara Unrealised foreign exchange gains worth UGX 15,093,435,449 have been recognised in the Statement of Changes in Equity. These arose from translating the USD opening balances and revenue collected during the period into UGX at the closing rate for reporting purposes” (OAG, P: 14, 2017).

Petroleum Data:

The oil companies did not fully comply with submission of reports relating to their drilling, exploration activities and operations as required. Delays and non-submission of reports results in an incomplete database which may reduce the effective use of the database in petroleum resource management” (OAG, P: vi, 2016). “The shortcomings in the management of petroleum data by the Ministry of Energy and Mineral Development may affect the completeness of the data on the existing petroleum potential, extent of reserves, and amount recoverable thus reducing Uganda’s ability to maximally exploit and benefit from its oil and gas resource potential. A thorough understanding of the resource base and its geographical distribution informs key decisions on the rate of exploitation and potential future revenues” (OAG, P: viii, 2016).

This should all be worrying that the State and the Industry isn’t sufficiently ready for the activity, as the URA cannot even allocate funds correctly. This is even before the Petroleum Data is taken care of and made sure that the exploitation and drilling happens where the best well is within the block. Secondly, the real value of the reports and the licenses that the state would offer to the companies. That because the flow of data and the status of it wouldn’t be where it could be. This is losses created by maladministration and lacking will of institutionalize the knowledge. Instead, the Petroleum Industry is controlled and has just a few handshakes away from the State House. That is why the URA might have delivered the funds to the Consolidation Fund instead of the Petroleum Fund. All of the potential might be wasted in the lack of protocol and care of resources management that is needed in the Ministry of Energy and Mineral Development (MoEMD).

The recommendations and the looks into the issues should be taken serious by the Petroleum Industry and the MoEMD. So the state could both earn more on the industry and also create more positive growth through the provisions that is already made in Public Finance Management Act (PFMA) 2015. So time will tell if they will be more reckless, if they will listen to the OAG or if the Presidential Handshakes will steal it all for keeping the NRM cronyism at bay. Peace.

Reference:

Office of the Auditor General Uganda – ‘REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF THE PETROLEUM FUND FOR THE SIX MONTH PERIOD ENDED 31sT DECEMBER 2016’ (07.06.2017) – John F.S. Muwanga

Office of the Auditor General Uganda – ‘Management of Petroleum Data by the Ministry of Energy and Mineral Development’ (December 2016) – John F.S. Muwanga

Ugandan economy could get Oil-Shocks due to external factors, recent BoU report claims!

Surprise, surprise the Bank of Uganda (BoU) has made a working paper on the possible consequences of the oil price, the oil exports and the oil imports on the Ugandan economy. This didn’t exceed my expectation of a report or paper, but said enough to clearly anticipate changes in the economy with the coming export. Even as the BoU called the domestic oil production in embryonic stages, which means the real impact will come when it is closer petroleum production the GDP and CPI feel more impact of the oil prices and the volumes exported from the Lake Albert Basin.

That the Ugandan State and the Republic of Uganda, should know that the fresh foreign exchange and currency into the economy, as the domestic parts of petroleum is not having big impact on the economy! Still, the export can change it as the oil prices and change the consumer price index for instance. Take a look!

One such shock that is a source of major concern and risks to monetary policy-making in Uganda is the oil shock. To our knowledge, the effects of oil shocks in Uganda, to date, have not yet been analyzed. The objective of this paper therefore, is to analyze the nature and importance of oil shocks to Uganda’s economy in a dynamic framework” (Nyanzi & Bwire, P: 4, 2017).

According to the Uganda’s Ministry of Energy and Mineral Development (2012), oil provides about 10 percent of Uganda’s energy requirements – the rest is sourced from the small and underdeveloped and unreliable electricity sub-sector and the cheap biomass energy. The oil sector was also deregulated in 1994, under the broad structural reforms implemented by the Government of Uganda, which effectively eliminated oil prices subsidies. Uganda is endowed with commercially-viable oil reserves, but domestic oil production is in embryonic stages. Consequently, all of the oil-energy needs of the country are satisfied by imports” (Nyanzi & Bwire, P: 8, 2017).

The results of the variance decomposition in regard to oil shock are not entirely unexpected, given the structure of Uganda’s economy. Oil and its products constitute 8 percent of total intermediate consumption and 10 percent of energy requirements. In addition, oil is crucial to electricity supply in Uganda because hydro-electricity is unreliable and insufficient. This implies little or no substitutability of oil with hydro-electric energy in production in case of adverse oil shock, which could justify the long-run 20 percent variance in output due to oil shocks. Regarding consumer prices, the small percentage of variance in consumer prices due to oil shocks is justified by the small weight of oil in the CPI basket. Oil constitutes about 1 percent in the 2009/10 rebased CPI basket, of which 0.8 percent is oil for personal transportation and 0.2 percent a source of liquefied energy at home. These numbers are not surprising given that over 75 percent of the population live in rural areas and depend mainly on wood and charcoal as a source of energy, and that rates of car ownership are generally low. Moreover, the main source of short-run volatility in the Uganda CPI is weather-related factors affecting food prices. This leaves the bulk of fluctuations in the core consumer prices (Comprising over 80 percent) explained by demand” (Nyanzi & Bwire, P: 18, 2017).

Oil shocks are transmitted through the supply channel, as a shock that increases the international price of oil leads to opposite movements in real output and consumer prices in Uganda” (Nyanzi & Bwire, P: 19, 2017).

It is hard to say how it could impact and how the petroleum production and exports will change the economy, how the prices and the inflation, as the measure of how much the price of the crude-oil will be at the given time. That the government has secret agreements with oil companies and also agreements with other to build the crude-oil pipeline that goes to Tanzania. Therefore, the reaction in the economy is not yet known, but with the background and knowledge of the how it is now. Most likely a real output and change in consumer prices in Uganda.

That will be an oil-shock no-one can be prepared for. Unless the Government and Parliament created legislation and policies who might soften the change of the economy. Therefore, with this in mind, the National Resistance Movement, the State House and the President Museveni have work to do. That is if they consider the implication the petroleum production and exports will have on inflation, currency value and consumer prices index as well. This report should open some eyes into it, but it should not be surprising. Peace.

Reference:

Nyanzi, Sulaiman & Bwire, Thomas – ‘Working Paper No. 04/2017 – The Macroeconomic responses to Petro Shocks for Uganda’ (May, 2017)

What do Mobutu and Museveni have in common after thirty years in power? Massive looting of their state reserves!

Museveni: My critics always forget to mention that I was democratically elected, the others were not. Everyone in Uganda can challenge me, everyone can vote, the elections are free. Not many countries have achieved what we did. One third of the seats in parliament are reserved for women, five seats for youth, five for workers, five for the disabled and 10 for the army. How many democracies with such a record do you know?” (Koelbl & Puhl, 2016).

Just as the knowledge of the all the state businesses and properties of President Museveni that he has amassed over the 31 years in power in Uganda. It reminds more and more of the state of affairs under President Mobutu. Mobutu Sese Seko was a dictator that President Museveni was proud to ouster and reinstate President Laurent Kabila in the Democratic Republic of Congo (DRC). So that President Yoweri Kaguta Museveni knows about Mobutu’s fatal fall, is certainly known.

President Museveni has gotten rid of other dictators before the fall of Mobutu, he even knew or had knowledge of the death of the plane of Juvenal Habyarimana, the plane who got shot down in April 1994, as his fellow comrade General Paul Kagame of Rwandan Patriotic Front was on the way to overthrow the current regime there. Also that the President Museveni together with President Milton Obote overthrew President Idi Amin in the late 1970s. So the current President Museveni has been involved in lots of armed change of power, he is even rumored and not verified if he had knowledge of the death of John Garang of SPLA and the South Sudan.

Still, the man who has used force and taken weapons to change history and his own fate, again and again, also to get puppets in states around. Have certainly thought of the demise of the men he got rid off. So when the stories of the last year of Mobutu sounds like this:

Mobutu’s Wealth:

For 32 years President Mobutu has treated Zaire like a toy and used its rich mineral reserves like his own private bank account. He plundered its mines, insisting their entire annual profits be transferred to personal accounts overseas” (…) ““We had to be close to the regime to do business,” admitted Mohammed Abdul, a Lebanese businessman yesterday as he fortified his shop for an expected pre-Kabila pillage by Zaire’s ruthless and brutal army. The Lebanese are hated by Zaireans who believe they colluded with President Mobutu to plunder the country’s diamonds” (Kinshasa, 1997).

Swiss assets:

The decision by the Swiss Federal Council came a day after judicial and police authorities seized his luxurious villa at Savigny near the lakeside resort of Lausanne. The 30-room mansion is estimated to have a market value of more than $5 million” (…) “After three decades of plundering the mineral wealth of his country, Mobutu is believed to have accumulated an enormous fortune. There have been persistent reports that he has stashed as much as $4 billion in Switzerland, but a government review of the country’s 400 banks last week said that none reported having accounts in his name” (Drozdiak, 1997).

Just as you think the dictator of Democratic Republic of Congo would be different than the current one in Uganda, your terribly wrong and President Museveni tries to keep it hidden, the way he is using the state reserves on himself and build his wealth. Just like President Mobutu was trying to move the money to the Swiss accounts, President Museveni has his own way.

A look into Museveni:

The way the Museveni family is paid royalties, or rent, by escrow accounts for their ownership of the title deeds of the Stanbic Bank business name in Uganda (what was once the Uganda Commercial Bank, Uganda’s largest banking group) is the way it is paid for their ownership of other apparently South African or foreign-owned businesses in Uganda” (…) “These sources say that it is Stanbic Bank that is used to finance businesses like Roofings Ltd, Speke Resort Munyonyo, the J&M Hotel along the Kampala-Entebbe highway, businessman Hassan Basajjabalaba’s hotel and Kampala International University, all of which actually belong to the Museveni family” (The London Evening Post, 2012).

This is just the business side of it, it could be worse by now and they could own more pieces of all the businesses that are bailed out or even getting tax breaks by the government, because who knows the true deeds or royalties going to accounts owned by the royal Ugandan Museveni family. So the next says more about the value of the Museveni family and their estates.

Museveni’s wealth includes ranches in Rwakitura and Kisozi Uganda which accommodates over 2,000 healthy cows which produce thousands of liters of milk daily. The Uganda president makes at least Ush 100 million per month from his farm” (…) “Apart from livestock farming, Museveni has interests in real estate, hotel industry as well as transport industry. He has also invested heavily in the banking industry” (…) “The longest serving president of Uganda is estimated to be worth $ 700 million” (Venasnews, 2016).

So when you see how the Museveni family has become as wealth and rich as President Mobutu did. Mobutu had after his 30 years of dictatorship stashed away US$ 4 Billion into Swiss Bank Accounts, what is more uncertain is the total value of the 30 years President Museveni rule in Uganda. What is right now and known is the businesses that the President is involved in or having ownership in. Secondly is the knowledge of estates, as well as ranches in Uganda with livestock that the President owns. Therefore, the extended wealth of secret bank accounts and not revealed businesses could show the true value of the Museveni family.

With the knowledge of this and the sudden departure that President Museveni together with President Kagame, as they forced the dictator away in the Democratic Republic of Congo (DRC). I don’t think there will be an intervention on President Museveni from one of the neighbors. Still, the world can see the dictator protocol is kept by Museveni as he himself have crafted ways of emptying the state coffers. Therefore, that the riches, the estates and the value of Museveni have risen over the three decades in power isn’t strange. What is more worrying is how he has been able to keep is wealth and ownership.

That President Museveni wishes to look like a hardworking rancher and that he works for his fortune. The yields are coming from hard-work and dedication. At the same time the ownership in banking industry and in other parts of the economy shows how much control the family and the President does have. The private industries and companies are run or ordered directly from the State House.

So that President Museveni said this in 1997 as he overthrew Mobutu is now insane:

Mr. Museveni’s ideology is simple. For too long, he says, African politicians have hoodwinked the common people, manipulating tribal sentiments to stay in power and steal millions of dollars in foreign aid and taxes. A former Marxist, he sees the true struggle on the continent as one between corrupt leaders and the dirt-poor people they exploit” (McKinley Jr., 1997).

So he said for to long African Politician played the commoners, using the sentiments of tribe on their populations and using this tools to stay in power, while doing so taking an emptying the state reserves and donor funding to themselves. Therefore, 20 years since he stood for this and said these words, he has now done the same.

President Museveni of today would assassinate himself or overthrow himself… since he is now the Mobutu of Uganda, he has the character of the men he overthrew in past. He should be worried, because the ghosts of the past and the reckless leadership will follow him and that is why he trust the guns more than people. Since his own insincere political game might catch up with him.

On some levels now, there aren’t much difference between President Mobutu and President Museveni. Peace.

Reference:

Drozdiak, William – ‘Swiss Freeze Mobutu’s Assets; Reports Put Worth at $4 Billion’ (18.05.1997) link: http://www.washingtonpost.com/wp-srv/inatl/africa/zaire/swiss.htm

McKinley Jr., James – ‘Uganda Leader Stands Tall in New African Order’ (15.06.1997) link:http://www.nytimes.com/1997/06/15/world/uganda-leader-stands-tall-in-new-african-order.html

Kinshasa, Mary Braid – ‘Mobutu takes the money and runs to a safe haven’ (16.05.1997) link: http://www.independent.co.uk/news/world/mobutu-takes-the-money-and-runs-to-a-safe-haven-1261945.html

Koelbl, Susanne & Puhl, Jan – ‘’This Is Our Continent, Not Yours’ (10.06.2016) link: http://www.spiegel.de/international/world/interview-with-ugandan-president-yoweri-museveni-a-1096932.html

The London Evening Post – ‘Revealed: How the Museveni family owns Uganda’ (03.01.2012) link: http://www.thelondoneveningpost.com/comments/revealed-how-the-museveni-family-owns-uganda/2/

Venasnews – ‘Yoweri Museveni Salary and Wealth’ (27.06.2016) link: https://venasnews.com/yoweri-museveni-salary-and-wealth/

Opinion: Austin Powers aka BoJo trying to be jolly in Uganda and Kenya!

There is one of these lost stories that deserves to questioned, as the United Kingdom who are toiled in issues on their own continent, with trade and with borders are suddenly sending their Secretary of State Boris Johnson, the former columnist who hasn’t written much of any good about these nations he is visiting. The visit is coming in the same weeks as the Brexit is a hot potato and the United Kingdom needs secure partners for their economic activity.

So the United Kingdom suddenly sending their Secretary of State for Foreign Commonwealth Affairs Johnson to Uganda and Kenya, seems to be more an internal needed boost for the United Kingdom, as they need to know that they have trading partners when the article 50 of the Lisbon Treaty get notified. The negotiations and the unknown agreement with European Unions, leaves lot of trade and transactions in the wind. Therefore, the need to diversify and get new connections is more important.

That UK have a long history on the continent and has done despicable things is well-known, that they have gone in only in the interest of the ones in Oxford Street, London or even business in Belfast over the ones in real need in the Protectorates or Colonies. So the United Kingdom Government have most of the time been more reassuring for the ones on the British Isles over the ones in the colonies. Her Majesties civil servants have served London and than offered a token of goodwill if needed be.

Therefore reading this of the visit seems like to good to be true!

Boris Johnson, the UK Secretary of State for Foreign Commonwealth Affairs, called on me yesterday at State House, Entebbe. Our discussion focused on regional security, especially the situation in Somalia. We also discussed trade and investment between our two countries” (Yoweri Kaguta Museveni, 16.03.2017).

NAIROBI, 17 March 2017 (PSCU) – President Uhuru Kenyatta this evening held talks with UK Foreign and Commonwealth Affairs Secretary Boris Johnson who paid him a courtesy call at State House, Nairobi. President Kenyatta and the British Foreign Secretary discussed promotion of industry and manufacturing. They also exchanged views on the strengthening of trade between Kenya and Britain as well as with the rest of the Commonwealth countries” (Uhuru Kenyatta, 17.03.2017).

First, that Boris Johnson isn’t caring much about the regional troubles, unless it bring work to Birmingham, Swindon or to Yorkshire. If the trade is being done and export from Kenya and Uganda, it is the British Exporters earning the major coins, not the Kenyan producer or the Uganda merchant. The needed tax-base has to be settled in the United Kingdom.

Secondly, the Commonwealth idea is to keep the sphere of the former colonies in a circle where the British and United Kingdom interest get traction and creates development on models where the British manufacturing and technology get traded to them. So that the former colonies get more ideal production from the Leyland and Vauxhall of today. Not buy Fiat or even Tesla. Buy British and serve British values and than if your a good boy, you get British direct aid.

Third, it is connected, but the uncertain future of trade within the European Union, makes the UK so edgy that they have to forge close relationship to make sure they have more open markets to have their bazaar and also sell their repacked tea.

So do I believe he was just visiting in goodwill and care of the Commonwealth nations, no! I do believe he came to be able to have strengthening the markets and get better surplus of funds with the counterparts of Uganda and Kenya. This because he knows that he doesn’t have to dole out much funds or follow heavy institutional policies to get it implemented. Therefore, he traveled here and tried to forge it even more. Peace.

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