Mzee is either in the darkness of the forest or walking in the banana-plantation; he surely have no plans to leave; that is the true #SteadyProgress

It’s hard for me to write this in all seriousness. Since I writing about an African President whom himself said this in 1986: “The problem of Africa in general and Uganda in particular is not the people but leaders who want to overstay in power” (Ross, 2011).  The President in particular is His Exellency Yoweri Kaguta Museveni, the President of Uganda for 29 years and counting!

Mzee said this in 1980 while running as a presidential candidate:

“Using a government position to a mass wealth is high treason. If the UPM is not going to be supported because it denounces such methods of getting rich, let it be”.

This he said while campaigning in Bushenyi and Mbarara districts(Weekly Topic, August 27. 1980).

So Mzee have  had a few points back in the day and knew this was an issues. Now he deflects  them to the extreme, to a point where it nearly get’s boring. Still here is his recents comments on the matter of riches and staying in power.

This was what Mzee said in November 2015:

““I have my own job at home of keeping cattle. Why would I stay when I have been defeated in the elections? I am not power hungry but I have missions to accomplish. I can’t leave without finishing with them” (Kazibwe, 2015).

Well, he has promised to step-down before, doubt he means this for long or even if this utter words was sincere other than for a show. This was for show from Mzee because of the coming Papal visit in Uganda (all seriousness the visit happen around 2 weeks after this interview). Well, let me continue on what he has said over the new-years and his ordinary modus operandi. When the pope has left the country and he could do what he normally do!

Mzee saisd this on 5^th January 2016:

“I have been hearing people accusing me of sticking around; that I don’t want to leave government. Why would I want to stay in government?” (…)”First of all I am a very rich man. I have a lot of wealth and therefore it cannot be riches that I am seeking in government” (Waswa, 2016).

Well, you have in been in power since 1986. That is sticking around for a while in government and as executive power for nearly three decades. We know you are rich you have a giant farm in Ankole, you and your families own a dozen businesses, some hotels and even some transport businesses as well. You started earning big bucks on transport under the DRC war in the 90s, but that is a nearly forgotten chapter for you and your brother Salim Selah, right? Still you’re in government because you fear what will happen if you leave it. Especially when there is oil-money soon coming into the accounts of Uganda and you want that slice to. The minerals and wood from Kisangani will be small-fry a bogoya. Well, we know about that and as your businesses and family businesses can be lost if you leave government. Therefore you want to secure those, it is a valid argument to stick around in government for wealth as man men make their wealth that way, one of the reason why you went to the bush to eradicate corruption and embezzlement. Well, that chapter is also forgotten and loyal cronies is more and more important therefore we have NRM-Independent and NRM Flag-Bearers in the coming elections, this is new and the NRM-Independents are breach of inner-party law. We know it is okay as long as Mzee,says it’s okay; he even pays the fees for the NRM-Independents to the Electoral Commission. This is to gain their loyalty as well as the ones the members picked in the district and sub-county. That is beautiful right? So, that is the reason why people wonder why you stick around and what can you do now that you haven’t already done? Still, let’s continue to the 10^th January 2016.

Mzee said this on 10^th January 2016:

“cannot leave power now because all he planted has started bearing fruits” (…)”Those who say, let him go, let him go, they need to know that this is not the right time. This old man who has saved the country, how do you want him to go? How can I go out of a banana plantation I have planted that has started bearing fruits?” (…)”We can’t be in the middle of a forest and want the old man to go. This is not right. We must concentrate on development, my time will come and I will go. I don’t fear going because I have where to go, but we must first see where we go” (…)”We can’t be in the middle of a forest and want the old man to go. This is not right. We must concentrate on development, my time will come and I will go. I don’t fear going because I have where to go, but we must first see where we go” (Rumanzi, 2016).

Now he is proclaiming that he has made a country into a banana-plantation, where it is finally bearing fruits. That means sweat bananas with good yields. That must be from the mustards seed he planted in 1986. Wait, this isn’t a mustard farm, but still the metaphor can be extended to the Banana farm. Yes, he has made the country into a Banana farm or should I say a banana republic. Now that all of that was daft, but the point is clear.

The economic state is getting dire in Uganda, the loans rate on the government budget is going up while the aid and donor funds goes down. While the oil-price lowers before the oil-monies are getting in. The sale of coffee is growing but it has not the yielded price on it neither is the sale of the tea. Like they are not producing enough sugar for consumption and have to import from Kenya.

IMF in July 2015 wrote in their report this: “Short-term benefits of the oil price decline have been less pronounced in Uganda than in other countries in the region. In the past nine months, petrol average pump prices have declined by 10 percent in domestic currency”.

He surely isn’t done by seeing all the campaign teams struggling with the villages roads his been building since 1986. Since FDC Campaign Convoy have been stuck in Rwenzori and in certain northern districts, while Mzee himself needed a military vehicle to be able to get to campaign rallies in Abletong. Well, the Banana-plantations don’t need a good road as long as the banana gets to market?

Or is it the growing amounts of districts, sub-counties and municipalities? Is that your proud work to make sure that that every corner of the country have a local council to control 1000 people and have loyal payment from you?  That seems like the final goal while going through your banana-plantation. In 1967 there was only 18 districts, by 1989 where already 34 districts and 150 counties. By my reckoning in late 2015 there are 111 districts and 167 counties. So the numbers has grown staggering amount of districts and steady rise of counties. Was this the big plan in 1986 make sure that there 3 times over district then when you came to power?

You might feel that you’re in the forest and not really in the mellow place of the banana-plantation since the situation economically, infrastructure, youth-employment, industrial-development, police-violence and so on. There are much darkness in the forest and not any sweat yields of the banana-plantation. The development that you have left is surely questionable; secondly the legacy you’re leaving behind is not the ones you wish you had. You could have been a man who led to real progress and stand for something new.  Instead you’re the same old tribe of African leaders who overstays in power and does let other people rule.

The economic state, together with the lower prices on coffee and oil should be worrying. Together with edged prices on imports as Uganda imports are higher than their exports. The weaker currency and higher inflation makes the trading barrier even higher. There are so many signs that the general election together with the laws that parliament passes gives more and more power to the Executive and his regime. Ever since Public Order Management Act there been more and more laws who gives the government more stronghold over the public instead of giving them freedoms and opportunity to evolve and think on their own. The laws that gives the government carte blanche to borrow money through the new Public Finance Management Act; one section of this law says this: “Amendment of Section 36: (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). That says how the government can initially use the Bank of Uganda as an ATM, was that the problem you had in the forest or the fruits your having yield on the banana-plantation?

I know that you have no plan of stopping being in power, I am just wondering when you actual thought of leaving since you have been there as long as have lived. Something not many Presidents have done except your friend in Zimbabwe, and maybe aquatints like Paul Biya in Cameroon, and Teodoro Obiang Nguema Mbasogo of Equatoral Guinea. But hey, they are from francafrique countries so I only expect you smile at them when you arrive at African Union meetings in Addis Ababa. Since they know and you know that all the fellows who meet with decades ago are no longer there.

We know that what you said before new years are utter rubbish since you have promised before to step down and haven’t. That has happened before 2001 and before 2006. Even before you got the multi-party system back into place; Gen. Benon Biraaro said this early part of his campaign in 2015: “When we captured power in 1986, Mr Museveni promised to rule for only five years and after he will go and look after his cows, I never knew his cows would be Ugandans”.

Surely, if his still is in the forest or in the banana-plantation or even with his cows in Ankole, it is for certain he is still the executive power and will do what he can to keep that in 18^th February 2016 or make sure the counting is fixed to measure the right way. Mzee will make sure that the counting of the ballots from the Electoral Commission declares him the President, AGAIN! If not he has prepared the police with a bucket full billions of shillings for post-election violence. So he must have looked in the darkness of the forest and worried for the outcome. In the sense that he smells the people are not his anymore. They do not follow him blindly and let him guide them freely. The banana-plantation is not as peaceful as it once was; This means that Mzee is not directly entitled anymore, to get the fruits of the plantation without any questions, from the people who are working on it. Peace.

Reference:

Kazibwe – ‘Museveni: I am Ready to Hand Over Power If Defeated’ (19.11.2015) link: http://www.chimpreports.com/museveni-i-am-ready-to-hand-over-power-if-defeated/

Ross, Will – ‘Would Uganda’s Museveni recognise his former self?’ (07.05.2011) link: http://news.bbc.co.uk/2/hi/programmes/from_our_own_correspondent/9477930.stm

Rumanzi, Perez – ‘I can’t leave power now – Museveni’ (10.01.2016) link: http://www.monitor.co.ug/News/National/I-can-t-leave-power-now—Museveni/-/688334/3027090/-/ldhhetz/-/index.html

Waswa, Sam – ‘It Is Never My Intention to Stick To Power – Museveni’ (05.01.2016) link: http://www.chimpreports.com/it-is-never-my-intention-to-stick-to-power-museveni/

IMF Country Report No.15/175 on Uganda and the IMF review of the Policy Support – Quotes and Outtakes

Now I will go through how the IMF is describing the economic situation in Uganda. It will have similarities with the budget of 2015/2016. Seem like the Ministry of Finance in Uganda. The numbers and fiscal standards are exactly the same. Still I think it will good to see and give what the Western Hemisphere and the monetary organ is saying about the economy of Uganda. So that people can see the similarities and also the difference quotes from the situation.

Min Zhu the Deputy Managing Director and Acting Chair in the IMF commented on Uganda in this way:

“The economic policy mix is expected to remain focused on attaining growth and inflation Objectives” (…) “The Bank of Uganda is encouraged to remain firmly focused on the maintenance of price stability” (…) “Enacting regulations to implement the new PFM Act and a charter of fiscal responsibility, and improving cash management are critical remaining reforms. Amending the Bank of Uganda Act and enacting financial institutions legislation are key steps to further enhance central bank independence and strengthen financial resilience”.

The Executive board:

“Uganda’s recent economic performance has been favorable. Real GDP growth is projected at 5¼ percent for FY2014/15 supported by a fiscal stimulus and a recovery in Private Consumption” (…) “Economic policies in FY2014/15 have supported growth and stability objectives. The fiscal deficit is estimated at 4½ percent of GDP, below previous projections, on account of a sharp tax revenue increase” (…) “The outlook is promising. Growth is estimated at 5¾ percent in FY2015/16 and an average 6¼ percent over the medium-term, driven by scaled-up public investment and a rebound in private demand”.

The Executive Board Assessment:

“Directors stressed the need for continued fiscal discipline in the pre-electoral environment, and recommended strengthened communication with the markets” (…) “Directors welcomed the adoption of the Public Financial Management Act, and advised prompt enactment of its regulations”.

Staff report from the 12^th June 2015:

Context:

“Security concerns following unrest in neighboring countries and terrorist attacks in the region have weighed on Uganda’s spending needs, exports, and remittances. Declining donor support in reaction to concerns about governance and human rights and reduced development partners’ aid budgets have spurred domestic borrowing requirements” (…) “During a period of moderate growth, inflation has come down significantly from its 33 percent peak in 2011; and despite a decline in international reserves and a pickup in public debt, both remain at comfortable levels” (…) “The reduction in the stock of domestic arrears was smaller than targeted reflecting a decision to backload intra-year repayments, but the annual target is expected to be met. Contracting of nonconcessional borrowing (NCB) for hydropower plants (HPPs), roads, and electrification was within the $2.2 billion limit. Most end-March ITs were met” (…) “The approval of the Public Financial Management (PFM) Act in November 2014 was a major milestone, and structural benchmarks on finalizing preparation on its regulations and the Charter of Fiscal Responsibility (CFR) were observed. The Treasury Single Account (TSA) set-up has laid the stage for improved cash management although more time will be needed to eliminate movements of cash and incorporate donor accounts in the system. The submission to parliament of amendments to the Bank of Uganda (BoU) Act was postponed” (…) “the government has started the implementation of an ambitious investment package aimed at narrowing the infrastructure gap, enhancing regional integration, and preparing for oil production”.

Recent Developments:

“real GDP growth was 4½ percent in FY2013/14, driven by services, trade, construction, and manufacturing—below the estimated potential of about 6 percent” (…) “The nominal exchange rate against the US dollar appreciated by 7 percent in the year through February 2014, and since then depreciated by 20-25 percent” (…) “The real effective exchange rate appreciated by about 4 percent in 2014, mainly reflecting the weakening of Uganda’s main trading partners’ currencies” (…) “Annual core inflation fell to 2.7 percent in December 2014 and rebounded to 4.8 percent in May 2015” (…) “GDP was revised upwards by 17¼ percent in FY2009/10, the base year. The services sector and to a lesser extent the agricultural sector increased their share in GDP, while the share of industry and construction declined” (…) “Short-term benefits of the oil price decline have been less pronounced in Uganda than in other countries in the region. In the past nine months, petrol average pump prices have declined by 10 percent in domestic currency” (…) “Oil investments might be delayed in the context of lower profitability. Moreover, many interrelated investment decisions are dependent on the oil price, including granting production licenses; signing commercial and financial arrangements; developing engineering, procurement and construction plans; and agreeing on transnational infrastructure works” (…) “The current account deficit remained large owing to structurally high trade deficits. Imports of capital goods and petroleum products are increasing, while both coffee and non-coffee exports have stagnated since mid-2013 reflecting depressed food exports to South Sudan” (…) “The monetary policy transmission asymmetry is explained by the banks’ cautious focus on loan recovery and their high operating costs, coupled with some crowding out effects as government’s domestic borrowing requirements increased at that time” (…) “The number of commercial banks has increased from 14 to 25 with a large influx of foreign banks, which currently hold 80 percent of assets” (…) “the BoU kept a tight policy stance, holding the CBR constant at 11 percent from June 2014 to April 2015, and then raising it to 12 percent, on account of global developments and the ongoing and expected exchange rate pass-through. The BoU’s intervention in the foreign exchange market has been focused on its program of announced dollar purchases for reserve build-up, but in the last few months it has been intervening on the sale side to smooth the fast-paced shilling depreciation. This intervention, along with increased infrastructure-related government imports, drove reserves down from $3.2 billion in end-December to $2.9 billion in mid-May (about 4 months of imports)”.

Economic Outlooks and Risks:

“Public investment financing, alongside weaker exports and tourism receipts, will drive the current account deficit up while preserving reserves at 4 months of imports” (…) “Low consumer prices—with average core inflation projected to remain within the PSI consultation inner band at 3½ and 6¼ percent for end FY2014/15 and FY2015/16″ (…) “Slower growth in key trading partners and further spillovers from lower global liquidity could trigger capital outflows, squeezing liquidity and generating currency mismatches for banks and corporations. In the medium term, the complex commercial and legal aspects surrounding FDI in the oil sector could delay the planned investments”.

Supporting Medium-Term Growth:

“The latter has been at the center of the authorities’ economic agenda as infrastructure investments of around $11 billion—including PPPs—are expected over the next ten years” (…) “With recoverable crude oil reserves of 1.7 billion barrels out of potential reserves of 6.5 billion, oil production would start in FY2020/21 under a model that entails a crude export pipeline and a domestic refinery” (…) “Uganda ratified the Monetary Union Protocol, and has been actively participating in work to establish EAC regional institutions and to create a fiscal surveillance process” (…) “the Uganda Revenue Authority (URA) to improve enforcement and compliance, but a sustained increase in the ratio will require incorporating the large informal sector into the tax-paying portion of the economy and ensuring that large taxpayers comply with their obligations” (…) “Sustainable financial deepening will largely rely on making steady progress on financial inclusion, which will in turn depend on actions to boost the bank deposit base; enhance the intermediation role of non-bank financial institutions, including the National Social Security Fund (NSSF); and develop the money and capital markets” (…) “Staff’s debt sustainability analysis, which includes the infrastructure package as a whole, concludes that the public and publicly guaranteed external debt-to-GDP ratio in net present value (NPV) terms would peak at about 25 percent in FY2020/21. Even combined with domestic borrowing plans, total public debt would remain well below the benchmark associated with heightened vulnerabilities” (…) “The tax-to-GDP ratio in Uganda was one of the lowest in the region prior to the GDP rebasing and is definitely the lowest afterward. Over the past ten years the ratio only increased by 0.2 percentage points per year, on average” (…) “Planned improvements include URA’s efforts to assess income from rental properties and identify businesses that are accessing local services but not filing national tax returns. Use of enhanced controls and creation of a single central processing center for all customs clearances should boost customs revenue” (…) “EAC convergence criteria, Uganda has targeted a tax-to-GDP ratio of 25 percent by 2021”(…) “Social protection in Uganda is entrenched in the Constitution, Vision 2040 and the NDP II. Interventions have nonetheless been limited and fragmented—with only 0.4 percent of GDP a year devoted to direct income support and 1.2 percent of GDP to total social protection”.

Maintaining Fiscal restraint while raising Public Investment:

“The overall deficit increased by 2 percent of GDP between FY2011/12 and FY2014/15” (…) “The overall deficit is projected to increase by an additional 2½ percentage points by FY2017/18 fueled by a continued expansion in capital spending (3¾ percentage points) and a small increase in current spending (¼ percentage point), and curtailed by a further improvement in revenues of at least ½ percent of GDP each year” (…) “the supplementary budget used part of the windfall revenue and expenditure savings to cover operational shortfalls at several ministries, and Electoral Commission outlays, among other pressing needs. All in all, the overall fiscal deficit is now projected to reach 4½ percent of GDP (6¾ percent in the program) and issuances of securities in the domestic market should remain within the target” (…) “The FY2015/16 budget will increase the overall fiscal deficit to 7 percent of GDP largely financed by NCB on favorable terms” (…) “The contingency provision was reduced by 0.2 percent of GDP at the time of budget approval to facilitate one-off spending on police activities linked to the election and allowances to parliamentarians, leaving little budget flexibility and requiring prudent execution in the year ahead”.

Protecting the Inflation objective:

“Some challenges remain, including insufficient institutional arrangements to prevent government’s use of deposits in BoU accounts beyond agreed levels, and shortcomings in inflation forecasting capabilities and fiscal-monetary policy coordination” (…) “Given the high share of imported goods in the CPI, import prices play a key role in inflation behavior, with an estimated pass-through factor of 0.4–0.5” (…) “The BoU has taken steps to reduce volatility in overnight market rates by allowing all banks (previously only primary dealers) to access BoU operations”.

Securing a more effective contribution of the Financial Sector to Growth:

“The BoU does not stress test banks’ resilience to lending rate hikes because of insufficient data availability” (…) “High dollarization. 37 percent of deposits and 43 percent of loans are denominated in foreign currency” (…) “banks’ business models, with a large share of assets devoted to investments in Treasury bills, reflect cautious risk taking, as well as curtailed policy predictability given the large swings in interest rates, thus jeopardizing credit growth”.

Building Institution and improving the Business Environment:

“Core fiscal targets: These targets are based on the EAC convergence criteria, and consist of an overall deficit target of 3 percent of GDP by FY2020/21 and an annual debt ceiling of 50 percent of GDP in NPV terms”.

Staff Appraisal:

“That fiscal policy decisions will be strictly aligned to the budget is essential to influencing banks’, corporations’, and households’ behavior. Even more critical, however, is that policy implementation adheres to the budget to build a track record of fiscal discipline during pre-electoral periods and preserve the economic objectives”.

Afterthought:

Can you believe it and how the inflation numbers together with the borrowing are not totally the same, that is for the reason that the Budget Deficit has been set by the government of Uganda is on the size of the yearly budget instead of the GDP as the IMF they set it there, the number will significant better and also smaller. Still, the Yearly Review which was ‘Value for Money’ told the same, even if the number will be different next year from URA and Ministry of Finance, Planning and Economic Development (MoFPED) will hopefully drop similar numbers next time. Since the numbers for deficit are going up and also the loans because of missing donor money. While waiting for the money from the Oil Development. Still, wait for how the budget year 2015/2016 will go. Peace.

How the Implementation of the IMF Policy Support is going:  

Letter from the Ministry of Finance, Planning and Economic Development (MoFPED) to the IMF:

Reference:

International Monetary Fund – IMF Country Report No. 15/175: STAFF REPORT FOR THE 2015 ARTICLE IV CONSULTATION AND FOURTH REVIEW UNDER THE POLICY SUPPORT INSTRUMENT—PRESS RELEASE; STAFF REPORT; AND STATEMENT BY THE EXECUTIVE DIRECTOR FOR UGANDA (July 2015).