

Dr. Ruhakana Ruganda (OPM) Government Statement: On Allegations of Possible Abuse of Refugee Funds (05.02.2018)






The National Resistance Movement (NRM) have over created a growing the debt. This meaning parts of the Financial Year of 2018/2019 is directly going to repay debt. NRM Regime is clearly paying more and more on the debt, than what they are paying for government services and also interest payment. The citizens of Uganda should be worried about how the NRM is projecting and using their funds, how they are adding debts to pay old debts. They are really disrespecting the wise people and the Republic. Since, they are over the time, not making the economy more healthy, but making it more sick. The signs has been there the last few years, as they are projecting petroleum profits. Even before it hits the ground running. It is worrying, that they are showing it this month in the numbers from the Parliamentary Budget Office.
“The Present Value of public sector debt to GDP stood at 27.1 percent in FY 2016/17 and is projected to increase to 31.2 percent in FY 2017/18 below the thresholds of 50 percent stipulated in the Charter of Fiscal Responsibility” (Parliamentary Budget Office, P: 2, 2018).
If you wouldn’t worry that the debt in the public sector rises with 4.1 percent in one year. I don’t care about the charter. When a state is able to make it rise with 4.1 percent in budget year, it shows that the economy is not fiscal responsible, neither healthy. It’s like continue to super-size burgers, when you already fat and having high blood-pressure. It will weaken the system with the continued eating of the super-sized burgers, instead of trying to find a healthy diet. Which will change the blood-pressure and how the body will feel with a balanced diet. However, when it comes to economy, the NRM doesn’t believe this.
“Domestic refinancing (borrowing to finance domestic debt) will account for 22 percent of total domestic resources” (…) “Domestic borrowing for purposes of financing the deficit is projected to
amount to UGX 939.9 billion” (…) “Project support will account for 97 percent of the total external resources while budget support will account 3 percent (from the World Bank and part of the PTA loan)” (Parliamentary Budget Office, P: 4, 2018). “Interest Payment projections include UGX 2,279bn for domestic securities (Treasury bills and bonds) and UGX 422bn for interest on external debt” (Parliamentary Budget Office, P: 5, 2018).
This here shows how the state is financing the debt and the repayment. Also how high they are pushing the domestic resources to repay domestic debt. This is clearly hitting the economy hard, when so big parts of the budget and resources is spent on repaying debt. This is all destroying the possibilities, since its taken a giant slice of the budget and using it on debts instead of paying salaries of teachers and civil servants.
This are the numbers, that people should take to heart. Because this debt and the rising debt is eating the budgets. The state is making it grow and is not containing it. That should worry anyone. Especially, the NRM who is in-charge and the President who has created this avenue and has to make sure this get payed. Peace.
Reference:
Parliamentary Budget Office – ‘INDICATIVE BUDGET AT A GLANCE – FY 2018/19’ (January 2018)

Yesterday was supposed to be celebrated, but however, I can’t. Not honestly, not, no, not knowing that this process of procurement and knowledge of possible unnecessary demise of dozens of cancer patients, while waiting between March 2016 to January 2018 for possible treatment. It is insane.
Therefore, when I read crap like this yesterday, when the Machine was launched by Prime Minister Ruhakana Rugunda, I don’t celebrate:
“The Prime Minister Ruhakana Rugunda has commissioned the new radotherapy machine at the Uganda Cancer Institute Mulago. This follows the purchase of a new radiotherapy machine after the old one crushed in April 2016. According to Dr Daniel Kanyike the head of the radiotherpay department at Mulago, 80 patients are attended to per day and they suspect the number will increase after the commissioning today” (Sudhir Byaruhanga, 19.01.2018)
Because, I have a letter dated back to IAEA from Dr. Byahagaba from 28th May 2013, where the funding of 325,297 Euros was deposited to the UniCredit Bank, Austria, Vienna on the 22nd May 2013. To start the procurement of a new Cobalt 60 Cancer Machine to Uganda Cancer Institute at Mulago Hospital. However, this has been lost in the story, that suddenly NRM moved swiftly in 2017 and got it ready for 2018.
It might be true that old one from 1995 – finally gave way and broke down in April 2016 before the General Election, the same fall. However, that doesn’t mean, they started procurement and facilitating the funds for a new one. They used longer time and awaited the destruction of the old one, before getting a newer model that actually worked.
They didn’t act quickly or swiftly in this affair. They moshed it together in a stew and hope to get gold, instead they are boiling bones and hope to taste the real deal. It is a mess and was a mess.
Because I still remember this:
“Cancer patients receiving radiotherapy treatment at Mulago hospital may have to wait until next year when the new cobalt 60 radiation machine will be installed, after the old one broke down three weeks ago. According to Dr Jackson Orem, the director of Cancer Institute at Mulago hospital, it may be difficult to repair the radiotherapy machine, procured in 1995, to render efficient results” (EA BIZ INFO, 08.04.2016).
Secondly, when NRM says April 2016, well, Dr. Orem speaks about three weeks before April, that means it broke down in March 2016. So the NRM cannot hold one piece of the story correct. Not even when it breaks down!
Therefore, the promise waited on results because of hardships to make a new space and have a new machine in where the old one was. The Uganda Cancer Institute had to wait and secure funding for a new one, even if they had already started procurement in 2013. Something they should have focused one, before making sure the old one crashed. This has clearly cost lives, since the Cancer patients have not been sent in drones in Kenya. They got some promises to Aga Khan in Kenya, but that was only for a few lucky ones. We can imagine how many cancer patients lost their ability for treatment between March 2016 and January 2018. It is insane, but also the structure and carelessness the National Resistance Movement (NRM) is known for.
So this has been a long await, which could have fixed before and was already in the making. Who knows why the authorities and the NRM didn’t fix it in advance, when they already paid partial payment in 2013. Years before it broke down. It is foolish and nonsense, when this is the only type of this machine in the whole Republic. Then, not being able to for-see its demise.
Well, NRM can think of this a propaganda victory, since no-one is questioning much and just is happy. The public shouldn’t be, because why didn’t they fix it earlier and made sure for a transition from one machine to another? Peace.





I will go over key points of the National Budget Framework Paper of Financial Year 2018/19 – FY 2022-23, that the Ministry of Finance, Planning and Economic Development released at the end of last year on December 2017. MoFPED or Minister of Finance Matia Kasaijja must surely flatter himself with this release. As the numbers and troubles ahead has to be meet with swift action. That the National Resistance Movement (NRM) and President Yoweri Kaguta Museveni should answer for the consequences their economic policies has affected the financial stability and fiscal responsibility.
On page seven of the paper, it was said this:
“i) Low revenue to GDP ratio, poor planning and budgeting due to non-adherence to Sector Investment Plans and increasing trends in supplementary pressures; ii) Lack of inter and intra sectoral coordination and increased cost of public administration resulting from creation of Authorities, Universities, Districts and related Administrative Units. iii) Accumulation of domestic arrears, arising majorly from court awards and delayed payment to the private sector that supply Government; and, iv) Low budget absorption especially for infrastructure projects resulting from delayed acquisition of right of way for projects and lengthy procurement processes” (MoFPED, P: 7, 2017).
If this isn’t signs of trouble ahead and lack of control of the economy, nothing is. When the government has trouble paying their dues, when they cannot absorb needed budgeted funds and also create longer procurement processes, while there is poor planning and lack of cooperation between different parts of the government and institutions. Therefore, the basic cost of developing projects and day-to-day services will be more costly, while the misuse of funds will grow. That is not the good steady progress, the ruling government promised in recent elections or anytime else for that matter in the reign of Museveni.
As the scale of debt has been on the rise of different years. The paper is clearly signaling bad news as well: “Amortization of external debt is projected at US$ 236.5 million, equivalent to Shs 894 billion in FY2018/19, which is relatively high compared to past levels because of repayment of the PTA loan. Thereafter, external debt amortization is projected to reduce to US$ 131.8 million in FY 2019/20” (…) “Government‟s interest payments are projected at Shs 2,701 billion in FY2018/19, of which Shs 2,279 billion is interest on domestic securities (Treasury bills and bonds) and the rest is interest on external debt. Interest payments constitute 9.8 percent of total resources available for spending next financial year. The figure is projected to rise to Shs. 2,788 billion in FY 2020/21 and will amount to Shs. 3084 billion during FY2021/22. A great percentage of interest payments about 84 percent is domestic interest payments which partly reflects high cost of domestic borrowing” (…) “Total government expenditure and net lending (excluding debt refinancing) will amount to Shs 22,520 billion in FY2018/19 and further increase to Shs 25,059 billion in FY2019/20. The bulk of this expenditure (10.5percent) is largely on account of increase in development spending arising from the scale up of public investments by Government. However, moving forward the implementation of the infrastructure projects will be more gradual to ensure consistency with the requirements to meet the EAMU convergence criteria. Recurrent expenditure is projected to increase by Shs. 166 billion during FY 2018/19 mainly driven by an increase in domestic interest payments” (MoFPED, P: 13, 2017).
That this combined with the early signs of worrying of procurement process, bad collective effort of ministries and also growing debt. None of this is a well-made government to secure services and institutions to serve the public. Clearly, there are other outlines and worries, since none of the early pages of the paper are too hopeful. These numbers has been shown before, but the MoFPED are really not hiding the fact, that the growing debt and services of it is taking a bulk of the budget this year.
As in previous years, the State House and Office of the President are getting big chunks of the budget. In the coming financial year the State House total budgeted funds are in the massive amount of UGX. 265,342 billion shillings and the Office of the President gets the amount of UGX. 56,436 billion shillings.
Will look more into that, when I get the hold of the Budget Framework paper directly made for that part of government. Since it is always showing some inspiring expenditure, if it is expensive water or spending on bad seeds for Operation Wealth Creation (OWC). That depends on what excuse the President and NRM needs to overspend on the majesty for life.
More will come later. Peace.

There is certain movements that will strike as more expensive for the East African Community (EAC). This being for the Government of Uganda (GoU) and the Government of Kenya (GoK), who has big plans of petroleum pipelines from their oil-fields and to the coast. That being from Turkana to Lamu Port. While the Ugandan oil goes from Hoima to Tanga Port in Tanzania. Both development and industrial projects will have issues with the funding. The World Bank has supported massive infrastructure projects in both countries.
Therefore, for the two counties big development and oil industry, this is giant set-back, since they have to find funding and loans for the pipelines on the open market. Even with higher interests and making the profits of it lesser, than it would have been with a World Bank loan. It would not hurt the pocket as much as it does on the open market. The banks wants more profits themselves and also make sure they are paid-in-full.
With all this in mind. There are speculations, but first. Parts of the self-answering service. Before we look at the reactions in Kenya and Uganda. All of are important, as the state is involved in the licensing and building the pipelines. They are directly into the development and procurement of the pipelines. That is why this is big blow for the administrations and their possible tax-profits on it.
Word Bank Q&A:
“Q. How is “upstream” oil and gas defined?
Upstream is an industry term that refers to exploration of oil and natural gas fields, as well as drilling and operating wells to produce oil and natural gas” (World Bank, 2017).
“Current projects in our portfolio would continue as planned. However, no new investments in upstream oil and gas would be undertaken after 2019, unless under exceptional circumstances as noted in the decision” (World Bank, 2017).
Kenya Pipeline:
“The announcement by the bank, which has significant interests in Kenya’s oil prospecting sector, does not bode well for the country’s anticipated entry into the club of oil producing nations beginning next year. Analysts said they do not expect an immediate reaction to the announcement even as they acknowledged that it takes the shine from oil in the long term” (…) “Locally, the World Bank is offering technical support to the Kenyan government, through the Kenya Petroleum Technical Assistance Project, to prime all stakeholders for commercial oil production and sale. The six-year programme is scheduled to run until February 2021 and involves the World Bank managing a Sh5.2 billion fund set up by investors from Germany, Norway and Britain. The World Bank’s private lending arm, International Finance Corporation, is however directly involved in Kenya’s oil fields, having a 6.83 per cent stake in Africa Oil, the Canadian exploration firm with interests in northern Kenya oil blocks” (Mutegi, 2017)
Uganda Pipeline:
“The pipeline, is expected to be completed by the year 2020, when the country is scheduled to start oil production. In fact, Uganda’s President, Yoweri Museveni and his Tanzanian counterpart recently commissioned the construction of the East African Crude Oil Pipeline. The two leaders laid mark stones for the crude oil pipeline in Mutukula, Kyotera district and Kabaale in Hoima district. Total E&P Uganda, a subsidiary of French oil giant, Total S.A, is spearheading the construction of the crude oil pipeline on behalf of the joint venture partners. Adewale Fayemi, the general manager, Total E&P Uganda says discussions are ongoing to discuss on the formalities of how the pipeline will be run. Already, an agreement has been reached that the East African Crude Oil Pipeline (EACOP) will be run and managed by a Special Purpose Vehicle (SPV) – private pipeline company. This means that a private company will be incorporated with joint venture partners – Tullow Uganda, Cnooc Uganda Ltd and Total E&P Uganda, and the governments of Uganda and Tanzania as shareholders in the company” (Ssekika, 2017)
Certainly, this will put a strain on the projects. They have to deliver another type of arrangement to make sure they get funding and have the funds to pay the added interests the banks wants. The added points on the dollar and the interest-rates will hit state-owned firms and the state itself. Since the pipelines most likely becomes more expensive and will be less profitable.
That the World Bank is pulling out of these projects is all within line of the Paris Accord, as they have professed is the reason. Still, this will make these projects more expensive and make sure they are earning less on it. Unless, the crude-oil prices are going up to a level that makes these investments even more profitable. That is only for time to tell. Since it is costly projects and also sophisticated to build. There is needed lots of expertise combined state planning to achieve the development plans.
This is just the beginning, but the pipelines and these investments are vital for both Kenya and Uganda. As the governments are already borrowing state funds on the possible earnings from the oil reserves in their basins. Therefore, they need to drill and need the petrodollar as quickly as possible. Peace.
Reference:
Mutegi, Mugambi – ‘World Bank dims Turkana oil hopes’ (14.12.2017) link: http://www.nation.co.ke/business/World-Bank-dims-Turkana-oil-hopes/996-4227848-u02v8n/index.html
Ssekika, Edward – ‘East African Crude Oil Pipeline: The Inside Story’ (11.12.2017) link: http://www.oilinuganda.org/features/economy/east-african-crude-oil-pipeline-the-inside-story-details-emerge-of-how-the-crude-oil-pipeline-will-be-financed-managed.html
World Bank – ‘Q&A: The World Bank Group and Upstream Oil and Gas’ (12.12.2017) link: http://www.worldbank.org/en/topic/climatechange/brief/qa-the-world-bank-group-and-upstream-oil-and-gas

