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Museveni’s economic management

What IMF figures on GPD growth in the world tell us about Uganda’s economic performance over time

THE LAST WORD | ANDREW M. MWENDA | Recently I wrote to the International Monetary Fund (IMF) to find out how Uganda’s economy has been performing over the last five years compared to other nations of the world and particularly within Sub Sahara Africa. Over the last five calendar years (2016-2020) Uganda’s economy grew at an annual average rate of 4%. This makes it the 27th fastest growing economy in the world, 14th in SS Africa. For a country perceived to have once been one of the fastest growing economies in Africa and the world, these results were disappointing but also illuminating.

Looking at the top line, I rushed to conclude that the management of our economy has declined. Like most people, I needed a villain to blame and President Yoweri Museveni was an easy target. I thought that as he has grown old, the speed of his decision making has significantly reduced. My evidence is that delays in making decisions on vital public sector investments in such areas as the Standard Gauge Railways, the Kampala-Jinja Expressway, Ayago Dam, the Umeme concession, oil production etc. I also felt age may have significantly compromised the quality of his decisions thereby negatively impacting the economy.

But one lesson I have learnt over the years is to interrogate my own assumptions by looking closely at data. When I did this, I realised that in 2016, which was an election year, our growth fell to 0.35%. But it bounced back to 6.26% in 2017, 6.14% in 2018 and 6.66% in 2019. In 2020, the growth rate fell to 0.28% due to COVID19. Therefore, when we remove the instability of the 2016 elections and the effects of COVID19, Uganda’s average growth for 2017, 2018 and 2019 is 6.7% which is great by global historical and contemporary performance. When we remove the distortions of the 2016 election and COVID19 from the sample, Uganda becomes the 8th fastest growing economy in Africa.

Again, I felt at 8th position, Uganda, which used to be a “star performer” in Africa, has lost its shine. But again, we needed to interrogate this assumption. Therefore, we looked at Uganda’s performance in the early years of the Museveni presidency when it is assumed the speed and quality of his decisions were very good. We actually found that in the first five years of his presidency (1986-90), Uganda was the 40th fastest growing economy in the world, 10th in Africa. Therefore, the claim of being best in Africa is a myth.

Looking at the data closely, we found that in the first ten years of the Museveni presidency (1986-95) it was the 28th in the World, 5th in Africa. In the first 15 years (1986-2000) it was 23rd in the world, 7th in Africa. In the first 20 years (1986-2005) it was 18th in the world, 5th in Africa. In the first 25 years (1986-2010) it was 14th in the world and 4th in Africa. Over the last 35 years, Uganda’s economy has grown at an annual average rate of 6% making it the 11th fastest growing in the world, 4th in Africa behind Equatorial Guinea, Ethiopia and Mozambique.

The take away from this data is that Museveni’s Uganda has never had a fast growth sprint i.e. a short period of rapid growth lasting say five or seven years when it topped the charts in the world or Africa. On the contrary, our growth has always been fairly good but not (as) rapid. The critical aspect is that it has been sustained over a very long period of time i.e. 35 years. That is why the longer the time-duration studied, the better the performance of Uganda in the global and Sub Sahara Africa league tables.

7 comments

  1. Quick question, when you computed position and growth, did you factor in all other countries or did you hold them at their level?

    • Great point you raise, James. I should also add that by “removing the distortions of elections and COVID-19 ” Andrew introduces bias in the analysis. Nonetheless, what Amdrew should actually have concluded is that our economy is not resilient enoungh to withstand shocks such as COVID-19; even a mere presidential election sends our economy crashing at a great speed.

  2. 1.Museveni scores A when it comes to economic management of the Country. Just like Singapore;Uganda has a liberal economy, charges low taxes and the immigration policy is great .
    2. Creation of cities will resolve the issue of rural-urban migration.
    3.There is no turning back when it comes to development in Uganda;all investors are either into Mining ,Dairy or Agricultural production.
    4.The CIA advised M7 not to think that the NUP issue was a far-fetched idea similar to the Arab spring; they told him that those children were not just playing while shaking his chair they would make him fall.

  3. 1). Andrew. Does the appearance of countries such as Rwanda, uganda, Siera Leone, Angola on a list of big performers mean anything peculiar to you? Can’t it make sense to you, even the blind, as mainly countries which had collapsed & any minimum recovery can post a big figure as growth? Just like some one being 120 out of 125 in class and improvement to 115 is looked at as better than some one who moves from position 4 to 2 in the same class? For example, uganda is one of the few counties on the globe that did well under SAP. The main reason was because it had nothing to loose. Whereas countries such as Zimbabwe, Kenya, Ivory Coast were losing hundreds of industries, uganda has nothing to lose and any small recovery because it had collapsed would be looked at as star performance.
    2). What is the point of showing high figure when overburdened by the debts? Just like showing you have build 10 houses all on debt? Does that make you better than the one who has built 5 houses using his money? Do you even bother to see how overwhelmed our deficit budgets are compared to Kenya and Tanzania? Where does the money to fund the deficit come from?
    3.What about the influence of former world bank president MacNamara who was so determined to do anything to make Uganda his legacy and a case study of a successful project after his failure? The Coffee boom in the 1990’s? Mineral resources discovery in the 2000’s? And of course Museveni’s consistent begging for grants and aid? I salute the Uganda’s private sector. They really work hard, only that they are frustrated by the bad taxation & government policies that don’t favour the locals at the expense of foreigners.

  4. Godfrey kambere

    A good read but nonetheless a World Bank report. Sometime back around 2014 the East African newspaper reported that the models used in the economic reports a few preceding years were outdated and therefore gave wrong conclusions. Now think of the various researchers in this country and ask them what their views are on these issues. I may ask if our representative to the world bank has to be a party cadre. Then the governors in BOU mostly from EPRC.
    Thank you

  5. You can have 8 % growth for 199 years in Africa and the place will still be poor. Some very vital ingredient is missing and being overlooked in the persuit of growth numbers and btwThese growth numbers alone are useless.The rich countries record growth for years with an end result. At that developed stage growth numbers are useless. Europe has 0% growth because the roads and infrastructure are already in place. (If Sweden recorded 5% growth it would raise a lot of eyebrows) Africa has to have high growth numbers by default because the place is empty, poor. However The numbers must lead somewhere ,or it is a total waste. Africa is rising like …. for ever! Jesus took 3 days to rise

  6. 1.@ Black star;When you hear M7 compare the Economic growth of Uganda from 1986 to date its not for fun.Its a report card.
    2.Statictics of Economic growth of any nation over the years are good practices that is embraced by all sober nations.
    3.If a Nation has no record of economic growth how will its creditworthiness be established?
    4.Do you know how good it feels when technocrats are making a PowerPoint presentation of Uganda’s Economic prospects?
    5.If Jesus who had powers over all forces took 3 years to resurrect how long will a third World nation take to resurrect?
    6.Do you want Uganda to be like big headed and isolated like North Korean,Cuba,Mexico and Venezula?
    7. Before Real investors invest in a Nation; they first analyze at the spending capacity of the middle class.

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