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Archive for the tag “MoFED”

Bank of Uganda: Monetary Policy Statement for October 2019 (07.10.2019)

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Uganda: Fresh report states that the debt-service has grown 129% within one financial year!

 

The Republic of Uganda’s economy is really reeling, it cannot be sustainable as the Government of Uganda is growing their debt like there is no tomorrow. While the fiscal growth is substantially lower than their rate of debt-service. As the growth of debt combined with lacking growth to substantiate the shortfall.

In addition, with the knowledge of added expenses, growing shortfall of funds in the upcoming Financial Year of 2019/20 and the election year of FY 2020/21. There will be more add-ons on the need for debt service, as the state already had loans outstanding, which the grace period ends and the debt-service begins on. Therefore, the amount of loans will transpire even more, than what is in this report. The endless cycle of debt and growth of it, is worrying, as well, as the state thinks that the magical wand of oil-money will clear this debt. Even as the first operational oil field and such has been postponed yet again.

Just look!

“The total Government of Uganda external debt service by end of FY 2017/18 amounted to US$275.75 million, which was an increment of l29% compared to US$120.62 million in FY 2016/17” (…) “Debt service of Uganda’s external debt is on the rise and outstripping growth of the country’s income, currently at 6%. This poses risks for future debt repayments, especially as the country continues to acquire external debt at less concessional terms, especially to finance the oil development programme” (P: 6-7, 2019)

“It follows that as interest rates increase, the debt service obligations of Government also increases. The rise in external debt interest costs attests to the fact the government is increasingly contracting non-concessional debt, which will increase the repayment burden” (P: 24, 2019)

“However, this may not be the most likely scenario, as most projects have been discounted and some excluded in the macroeconomic framework. With the development of the NDP III, additional project and other pipeline project related to the oil developments and other infrastructure, will increase the financing requirement of government in the medium term. The inclusion of the above projects will re-classify Uganda from low risk of debt distress to moderate risk of debt distress or high risk if the export shocks materialize. A downgrade would have significant implications for the program with the IMF, where Uganda’s credit risk rating will worsen; implying that accessibility of nonconcessional financing will be limited. This will limit credit to Uganda to only concessional and grants financing.” (P: 28, 2019)

You don’t need to smart about it, as the state has bigger budgets with higher shortfall in the economy, combined with debt service and higher interest payments on the growing amount of loans. You know sooner or later, the economy will tank, as the fiscal responsibility is taken for granted and that fresh funds are lacking, because these are taken out of the economy to finance the payments of the old debts. Instead of generating growth and actually naturally grow the economy, by spending and investing as a state. The money is taken away to service debt, instead of building the state. That is what they are doing and at a alarming rate. Peace.

Reference:

NEC1-19 – ‘REPORT OF THE COMMITTEE ON NATIONAL ECONOMY ON THE STATE OF INDEBTEDNESS, GRANTS AND GUARANTEES’ June 2019, Parliament of Uganda

Uganda Peoples Congress: Caution on Coffee Bill (17.07.2019)

Bank of Uganda: Monetary Policy Statement for April 2019 (01.04.2019)

Bank of Uganda: Monetary Policy Statement for February 2019 (07.02.2019)

Preparation for General Election 2020/21: When these budget posts are served extra-funds!

As we are aware and since the National Resistance Movement (NRM) dropped their Road Map for the General Election of 2020/21, the whole system has started to flair up for it. Both with Electoral Reforms and other measures, to secure swift results in favour of the President and secure his cronies. That is just the way it is.

As we will see in the Budget Framework Paper for Financial Year 2019/2020, the government and their agencies are clearly gearing up for elections. As the NRM wants to make sure the appointed and anointed get their cut ahead of scheduled elections.

The first ones whose secured and getting well funded is the Residential District Commanders, they are getting 5,5bn shillings to promote government policies. There is also estimated right before the elections, the state will go from 128 districts in 2018/19 to 135 districts in 2019/2020, there the state has to use more on them just for the need of new RDCs too.

To give RDCs possibility to do their work, the Office of the President has asked for 25.4bn shillings to buy 165 Double Cabin Pickups, but there is only small fry for what is coming up.

The State House itself is gearing up, as the Office of President has asked for an allocation of 741.1bn shillings.. Just to give a feeling of the changes of gear, is that in National Budget Framework for Financial Year 2018/19, alone, the State House got 265,342bn shillings. We can see a significant change ahead of the coming elections.

To top it off, the logistical support, welfare and security to H.E the President, Vice President require 118.38bn shillings. Therefore, the Presidency, the State House and everything concerning that is much more expensive in Election Times and ahead of campaigns. As proven by the Report delivered to the Parliament.

This are just small pieces of what the Committee and what Jesca Ababiku MP delivered the Parliament, as requested to secure funding and also more funds to certain aspects. As it is fitting the elections and the timing for more cash to certain places. We saw it before the General Election in 2016 and is seeing it now. Repeating itself, getting budget for cars and more expenses paid. More funding to the State House and President. Just as programmed. To think otherwise is to be blind to what is up.

This is just what they do, not building institutions or such, but buying to time to linger in Office. Peace.

Reference:

REPORT OF THE COMMITTEE ON PRESIDENTIAL AFFAIRS ON THE BUDGET FRAMEWORIT FOR F’Y 2OL9/12O – 2023/2024, Parliament of Uganda, January 2019

President Museveni letter to Hon Matia Kasaija: “Re: Massive Tax Evasion and Concealment of Rental Tax” (23.11.2018)

Possible outcome of the revised Investment Code of 2017!

Yesterday at the Plenary in the Parliament, discussed the revised Investment code of 2017. Which in its self isn’t the most exiting thing. Nevertheless, the reality is that this is now in Parliament shows a push from the Members of Parliament and the Committee of Ministry of Finance, Planning and Economic Development (MoFPED). That they are up to something. They are trying to forge something ahead. However, as the President has claimed the bureaucrats for being lazy, this shows another attempt. However, if this parts of the laws are enacted. Will ensure that it takes longer and the quality of the Foreign Investor to hold onto the new demands of the state. This will also give more power to the Uganda Investment Authority (UIA).

As the September report on the bill states. They will register all investments and all incentives inventory, as off who is doing what and licensed to do. As the Foreign Investor has to comply too a more rigid laws to be able to in the first place now.

Because the change of laws is that an exports of a minimum of 70% of the production in the given incentive, hire at least up to 60% Ugandan citizens and accept to monitored by the authorities and the statutes within the law. This being the UIA, which has the oversight.

The Incentive before launching has to verified and certified by the UIA. The same authority that has oversight and register the incentives. The Foreign Investor has to notify the UIA if they are complying with their inventory to the UIA as per law.

As to make it more hectic for anyone to invest is not allowed to directly to be investing in farming, as production of agricultural output. They cannot do that, but they can be able and allowed to own factories and businesses that helps the farmers to get better crops or bigger livestock.

The law states further the priorities for a Foreign Investor, as per law: “1. agro processlng; 2. food processing; 3. medical appliances; 4. building materials; 5. light industry; 6. automobile manufacturing and assembly; 7. household appliances; 8. furniture; 9. logistics and ware-housing; 10. information technology; or ll. commercial farming”.

This really put the parameter for what they can and cannot do. They are specific as to who allows, what sort of investment, who certifies and who monitors. Therefore, a foreign investor, by law has to comply a lot more and has to have more paperwork to prove his business-plan, prove his investment, his hires and his initial plan for getting exports of the giving products. This will clearly hamper investments and create a longer time-table for them. As the Foreign Investor cannot focus on local market, but on international market, because that is how it is by law. In addition, when you invest in something, you don’t want to loose your certification or your rights to produce or export given products.

Also, the same investor needs to incorporate the business with the Registrar General, a certified of remittance by the Bank of Uganda, the second, the certified of remittance to lodge an application to the Department of Immigration and this department have to give the Foreign Investor a permit to do stay and do business in Uganda. Therefore, before engaging with the new criteria of the UIA and MoFPED, the investor has to get the BoU in check and get the Department of Immigration. If all of these factors doesn’t slow down a process, nothing does. This is clearly a way of securing jobs for bureaucrats and lesser the burden of the foreign exchange and remittance in general.

  1. Get UIA Approval and Certification of Business
  2. Get BoU Certification of Remittance
  3. Get Department of Immigration – Permit and Application of Remittance
  4. Getting monitored by the UIA to see you comply with the codes.

If that sounds like an easier way in, it doesn’t, more offices and paperwork, before even spending money. This code will clearly hamper more foreign investors from coming, unless they are giving Presidential Handshakes to the President. I am sure he then lets them in. Peace.

Bosco was warned in 2016 about printing own currency, but in 2018: Goes ahead with it anyway!

The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.” Ernest Hemingway

There are someone who doesn’t listen to advise, even when it is well written and with shown data to President Yoweri Kaguta Museveni in October 2016, as there was reports and even made deals at the State House on the 7th October 2016. As the meetings was already ensuring and securing the deals between the Government and the printing company Veridos GmBh. By that time the Veridos company had delivered their commitments to print currency in Uganda. Also a comprehensive business plan that envisioned the proposed joint venture between Veridos and the government.

Now it is the 10th October 2018. Surely for many or plenty, this sort of an agreement is forgotten. Again, today at Entebbe State House, the deals was sealed.

As the Chimps Reports stated: “In the meeting that took place at State House Entebbe on Thursday afternoon, President Museveni noted that this new venture would save Uganda a lot of money that it has been spending on printing documents from abroad. “There was hemorrhage of resources that was unjustified. Money was going out to print currency notes for a long time. About US$25 million was spent each year to create Ugandan currency,” he said” (Kyatusiimire, 2018).

He is saying this without saying the cost of what sort of agreement the government has with company they are already using. As the lack of openness is shown from the state. That is why in 2016, the documents leaked and today, they just came on a government friendly web-paper.

To long:

Interestingly, Mr Museveni, who thanked the German company for its joint cooperation, criticized government officials for “taking too long” to act on such “crucial matters that affect the country.” He added that licensing bodies must not “over price working licenses for investors because it cripples investment and discourages potential investors. “These things of taking two years to deliberate on such matters must stop. Why did you spend two years discussing something that was so obvious?” he wondered” (Kyatusiimire, 2018).

That wasn’t obvious to the Governor of Bank of Uganda Prof. Emmanuel Tumusiime-Mutebile or the Minister for the Ministry of Finance, Planning Economic Development Matia Kasaija, who both was skeptical, not only because isn’t a company who is known for producing currency, secondly the costs are likely to be more, than what they have today and last the possibility for more forgery. All of this data was scrapped, as Bosco had decided himself.

So for some weird reason, Bosco want to take a bad deal, which his experts has said is a bad deal. He complains that his experts has made it takes this, because they didn’t have faith in the project. All been done at the State House, as it was started in 2016 and rewinds again in 2018. What value has the Governor of the BoU and Finance Minister, when their words are meaningless towards Bosco?

Someone please tell me, because I got nothing. Peace.

Reference:

Sharon Kyatusiimire – ‘BREAKING: Uganda to Print its Own Money Locally’ 04.10.2018 link: https://chimpreports.com/breaking-uganda-to-print-its-own-money-locally/

Resident District Commanders Re-Shuffle: A list of Honourable Mentions! (October Edition) Part II

I just had to go over the list of one more time, as there are plenty of names and figures in it. The Residential District Commanders are the ones whose supposed to implement the government agenda. That is why they are there as appointed officials, which the President directly put forward their agenda for their work and also oversee the elected officials and civil service there. That is why the manner and the acts of the RDCs could be important, as they are the ones reporting to the President.

For instance the former Kitgum RDC Captain Okot Santos Lapolo are re-appointed for the Gulu District, which has been a career RDC first for over 12 years in Kitgum, before he has now been in Gulu since 2016. In early February 2018, he closed Radio Mara as he ordered the arrest of Choice FM editor there.

The Fred Bamwine, the former RDC of Nakawa, Rubaga, Bukiwe, Butambala and Ntungamo has now been appointed as the RDC of Mukono. He has addressed the amount of Ghost Workers in Ntungamo District in 2014. He is a career RDC, whose been often moved and not worked long. As shown by all the districts he has worked in, in 2017 he said: “What happens to districts that don’t get certificates of compliance so that they don’t do the same things,” (CSBAG – ‘Poor infrastructure, weak accountability hurting Local gov’t service delivery’ – CSOs, 18.09.2017).

The Former FDC Deputy Speaker of Kumi, Ambrose Oronia, gone from being a Deputy RDC of Amuria and is appointed to be RDC of Ngora district. She went from the FDC to NRM because she “wanted to serve the people”. That was back in 2008.

The newly appointed Rukungiri RDC Dan Kaguta is the former Wakiso District RDC. Kaguta has been called the brain behind the NSSF Bribe case of the IGG in the 2014, where he was an accomplice with Jane Mpeirwe. Back in 2012, he was involved in possible extortion of the KCCA. So this man has a record himself and been steady in questionable cases, however, that doesn’t stop the President from not appointing him.

Then there was Wilberforce Tukei, who lost the NRM Primaries in 2015 to become the NRM MP Flagbearer for the Bukedea district. He is now appointed as the RDC of Soroti District. He is the former LCV Chairman of Bukedea. Wilberforce has also fallen out with Rose Akol in 2015.

Richard Andama Ferua has been taken with forged academic papers (2006), jailed over rental arrears (2011) and jailed for debt in 2016. The former Arua LCV Chairman are now appointed to become the RDC of Yumbe District.

Then you have Maj. Ret. David Matovu, who is the former RDC of Mukono and Masindi. Before that he has been appointed as early as in 2008 by the President to be Chairman of the University Council at Makerere University.

In 2006 was the former Adjumani District Chairman Nixon Owole freed after being jailed for defilement. He has also been the LCV Chairman of the same district since. He is now appointed the RDC of Tororo.

This was just 8 more persons on the long list of appointed RDCs. Therefore, hope more people scan through and shows the past of the people, that Bosco put his trust in. Peace.

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