Gen. Saleh now running Museveni’s government
On July 21, a group of Kampala traders met at Serene Suites, a boutique hotel of two boxlike four-story blocks on top of Mutundwe Hill on the edges of the city that has become a sort of headquarters for the financially-distressed business people. The hotel is owned by one Esther Ampumuza, a middle-aged woman with a leg in many business and philanthropic ventures, including the international multi-level marketing company Dynapharm, where she is the president for the Africa region, and AfriAid, a relief agency where she is a director.
In many of her ventures, Ampumuza works hand in glove with President Yoweri Museveni’s younger and very influential brother, Gen. Caleb Akandwanaho aka Salim Saleh.
In fact, Saleh has since late 2014 been occupying the only presidential suite at Serene Suites that costs US$1,000 per night. Saleh also maintains an office at the hotel. Saleh’s presence with the attendant heavy security deployment and endless visiting delegations that include the Who is-Who in Uganda’s political and business world has led Serene Suites to be called “the other State House”.
On this day, however, Saleh was nowhere to be seen as the Kampala traders met in a tent in the hotel grounds just across the swimming pool.
Many narrated how the current tough economic environment has put their businesses in distress and led them to seek a bail-out from President Museveni through Ampumuza and Saleh.
One speaker wondered why they are not getting a share of major contracts in the ongoing large infrastructure projects. Another complained about the Central bank raising the Central Bank Rate (CBR), which in turn makes commercial banks hike interest rates. None of the speakers appeared to be from any of the big business or manufacturers who are also seeking to be bailed out by the government to the tune of Shs1.3 trillion (Approx. $384 million).
Given that the companies on a list that continues to circulate have to pay Shs 1.3 trillion and that the total value of nonperforming loans is Shs. 1.8 trillion, it is possible those attending this meeting fall in the category that needs the remaining Shs 500 billion.
Uganda’s top business entities, including the steel manufacturers Roofings Ltd and Steel and Tube, and Simba Group of Patrick Bitature, which is into telecoms, electricity generation, agriculture and real estate, are all on the list that has been circulating. There are also maverick businesses like that of Desh Kananura, the owner of Panamera Bar.
Serene Suites is also on the list requesting a bail out of Shs 3 billion to pay a loan the proprietor took from Uganda Development Bank.
Several top government officials, including from the Central bank, ministry of finance, and the National Social Security Fund, have all denied there is a major bail out coming. However, informed sources have told The Independent, not to write it off until President Museveni gives the final word on it. According to the source, several salvage options for distressed companies are being considered.
So the small players at Serene Suites, in fact, complained about the big players on a list that is allegedly to be bailed out. One said even some of the businesses that are slated to get bail out money are people who did not support President Museveni in the February election.
“Mzee (President Museveni) did not know about this,” one of them reassured the attendees, “but now, he has said that he will support his people (distressed businesses) even if it means changing the law.”
As the The Independent reported in our story titled `Fight over Museveni’s business bailout money’ of July 15, President Museveni on July 09 summoned top officials from the Ministry of Finance, the Central Bank and Uganda Revenue Authority (URA) for a meeting at State House, Entebbe to discuss the bailout.
Records from the Central bank show that commercial banks in Uganda lent out some Shs 21.9 trillion. Of this, Shs 1.8 trillion has been declared to be Non-Performing Assets on the books of several banks. Some banks have been hit more than others.
Among those who attended what has been described as a high stakes meeting was Deputy Central Bank Governor Louis Kasekende and URA Commissioner General Doris Akol. Others included officials from the finance ministry, and Gen. Saleh, who is the head of Museveni’s poverty fighting creation called Operation Wealth Creation.
That meeting was discussing what to do for over 100 Ugandan companies that are reeling under heavy commercial bank loans.
The meeting followed several others in which technocrats from the Central bank and the finance ministry have sharply disagreed and opposed plans by some top politicians to have the government fork about Shs 2 trillion (it keeps growing as more names are added to the list) from the public purse to pay off the loans owed to commercial banks and save private businesses, whose assets some banks have already started attaching.
Saleh reportedly made the case for the companies because he was the first to be approached by business people and has been deeply involved in lobbying for them. At one point he summoned Finance Minister Matia Kasaijja to Serene Suites to discuss the matter.