Opinion: Museveni prefers his own rules…

The economy is growing. The other day, I had some arguments about whether we have gone to middle income or not. We reaffirm. I do not know where the World Bank is getting their data from” – President Yoweri Kaguta Museveni (14.07.2022).

The former donor darling of the West and the Self-Styled President for Life, Yoweri Tibuhurwa Kaguta Museveni has yet again signalled the World Bank. That comes after the bank dismisses the claims of have becoming a “Middle-Income Country”. The Government of Uganda and it’s agency cannot trick the World Bank and their standards. Museveni can hoodwink his supporters and his fellow associates. However, the World Bank… not so much.

President Museveni is the sort of man that makes his own rules along with where his walking. His not the sort of fella to follow it himself, but expect everyone around to comply. He can talk of ethics and moral rights, but breach them himself on a regular. Secondly, laws and rules are for others to follow. He himself, not so much.

That’s why when there is stipulations and mechanisms for giving the stature of Middle Income Country from the World Bank. The Government of Uganda, and it’s Ministries should work to achieve that. Not just throwing numbers at the wall and hoping it sticks. That’s how this looks like. His just using figures and imprinted numbers to look extravagant. When the President should know that his far from achieving it.

The Republic cannot build a road without a loan, donation or sort of scheme to ensure funding to make it happen. The aid agencies has to come and intervene on the basics of structures. The bloated government structure is eating of the funds, the massive parliament and it’s expenses in combination of the State House and the Office of the Presidency. Is all accounts, which is having huge expenses, but not generating any sort of generational wealth or influx of foreign exchange into the economy. However, that is just draining the state budgets together with the interests on old loans and the growing debt ratio of the state. So, with that in mind….

I don’t know where his figuring out at the year of 2022 that the Republic has become a Middle-Income Country. Because, there is no signs of it. Unless, he has a screw loose or just wants to prove that he achieved something. Even if he sleep-walked to the destination and was more pre-occupied with destroying his political enemies. If the state has used half of the energy and resources it uses on locking up, monitoring and detaining political opponents. Maybe, it would have a shot of a better economy, but it is instead building prisons and buying tear-gas.

That’s why Museveni just making up the rules as he walks along. He thinks that’s how the world works, because he has done that for over 3 decades now. As President he has gotten away with it too and with little to no consequence. However, in this regard.. don’t expect the World Bank to budge. Because, Museveni needs the World Bank more than the World Bank need him. His a debtor and a man who needs grants from the World Bank. It is not the World Bank that needs validation from Museveni.

This is why this enterprise is futile. He cannot bushwhack this one. He cannot trick it and make it work. The shilling is the shilling. The economy and the finances is as dire as the people say they are. The Deficit financing and the lack of domestic revenue is a proof of that. His made up numbers and schemes to get grandeur isn’t helping either.

Museveni, you can chill on your farm and look after livestock. The sort of game your playing is only making a fool of yourself. So, do you want another rap? Peace.

The Art of Deficit Financing: Budget 2022/23 and the worrying affects of the growing debt…

The proposed budget for FY2O22/23 hos increased to UGX 47.25 trillion from the approved budget of UGX 44.77 trillion in FY2O21/22. ln the proposed budget, recurrent expenditures amount to UGX 33.54 trillion (71%) while development expenditures amount to UGX 13.70 trillion (129%). Worryingly, the projected revenue collections of UGX 25.54 trillion cannot fund the country’s entire recurrent expenditures” (Opposition Response to the Annual Budget Estimates for FY 2022/23, 03.05.2022).

When you read the first numbers on the Budget for the Financial Year of 2022/23 you see a problem that has been a long lingering issue. The National Resistance Movement (NRM) and Government of Uganda (GoU) has done this for several of years now. The state has banked on loans and grants to cover the deficits. While the state is budgeting with a deficit financing method, which is far from covering fiscal funds by the lack of domestic revenue. That’s why the rising debt and the cycle of recycling debt isn’t making things better.

Just read this paragraph here:

It is critical to note that debt management costs hove risen from UGX 8.58 trillion in FY2017/18 and ore projected to be UGX 15.94 trillion in FY2022/23. This translates to on increment of 86%. The costs take first coll on the budget to cater for interest payments, commitment charges, debt management fees and amortisation. Therefore, from the onset 33% of the proposed budget will

not be available for service delivery. instead, it will be utilised for payment of partial debt commitments” (Opposition Response to the Annual Budget Estimates for FY 2022/23, 03.05.2022).

Just seeing this number, as you see the lack of domestic revenue to cover the budget of 47 trillion shillings, which is only at the level of 25 trillions. While the project debt management is put to about 16 trillions shillings. That means most of the domestic revenue would be used to pay old debt. Unless, the state plans to take out more loans and recycle debt to pay the old debt. That is just pushing the problem further down the line and get more interests as well. Therefore, the state finances isn’t tricky anymore, but a tragic phenomenon. These sorts of numbers are getting closer to default and a possible debt trap at one point. As the state needs more loans to cover current loans. That is not how to run a nation and neither how to run a fiscal responsible government.

The numbers becomes even more striking:
“The advance effect of this astronomical level of borrowing is felt through interest payments of over UGX 5.5 trillion in FY2O22/23 rising from UGX 2.4 trillion in FY2017/18. An increment of 130%. This is coupled by external debt repayments that ore projected at UGX 2.4 trillion in FY2022/23 rising from UGX 589 billion in FY2017/18. An increment of 307%. These toke first coll on the revenue collection and reduces funds available for service delivery” (Opposition Response to the Annual Budget Estimates for FY 2022/23, 03.05.2022).

We see the debt management and now we see the rising interest payments are also doing the same. The ones that has been crying wolf and worried for the rising debt portfolio is catching up with the government. The Ministry of Finance and Planning and Economic Development (MoFPED) has failed to comply with the mechanisms and the codes of Public Finance and Management Act. Clearly, the Government and the all the Ministries has to be following suit.

These sorts of numbers should strike fear of a debt default and a crashing economy. The art of deficit financing … is now becoming a growing issue. The state cannot hide from this and this should worry the citizens. As there is nothing given that the creditors will be merciful or give way. They might … be vengeful and take collateral over failure to repay the debt. Peace.

A very brief look into the recent appointments of Permanent Secretaries

Yesterday, President Yoweri Kaguta Museveni has had his little reshuffle of Permanent Secretaries to the Ministries and Offices of the State. There wasn’t much juice to see. It wasn’t like he offered yet another Forum for Democratic Change (FDC) leader or stalwart to a position. No, Museveni just did more of the same.

Plenty of the secretaries retained their roles and continues to be “permanent”. This being Lucky Nakoybe and Dr. Kenneth Omona who is kept in the same office. Someone who is lucky and in good favours of the state is Keith Muhakanizi who went from the Minister of Finance to the Office of the Prime Minister.

The appointment of Dr. Ramathan Ngobi, the aide of Salim Selah, the brother of the President has been appointed to be the Permanent Secretary of Ministry of Finance, Planning and Economic Development (MoFPED). A clear indication of how family affairs mattes and this is why Muhakanizi was moved to another office.

The one that sent a begging letter recently to the President after losing in the election and not being appointed to a Ministry. The forever in the public eye, Adolf Mwesige was appointed as a Permanent Secretary as a Clerk in Parliament. So, the President has him still in his good favours, as he knows he will be loyal for yet another appointment.

All of the President’s appointments are more of the same. These are just the few I see worth mentioning. Museveni is recycling most of the same people. Just a few new faces, but these are known for the general public.

The NRM doesn’t change and neither does the President. This is just more of the same. It is just some changing chairs, but not appointing more qualified or better equipped people. No, these are hired after loyalty and not after merit. That’s why these folks continues to get retained and work like they do. Peace.

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