Why Uganda’s economy is dominated by multinational capital and what cannot be done about it
THE LAST WORD | ANDREW M. MWENDA | We begin from where we stopped last week. Uganda’s growing economy served three critical purposes: It increased government revenues, gave greater confidence to donors to give more aid, and increased resources available to government to pay for patronage, provide basic public goods and services and fight armed insurgency thereby aiding legitimacy and political consolidation. Consequently, Museveni gradually shifted from implementing these reforms as an opportunistic beneficiary and became a believer in their efficacy.
The donors also were keen to cultivate political support among Uganda’s elite class – politicians, the civil service, the mass media, academia, private sector and “civil society” (a motley collection of NGOs).
To understand the trajectory Uganda took from the late 1980s, one has to first understand how the donors shaped our post conflict recovery by building the ideological base for these policies among key individuals and groups. We shall see the interests that consolidated during this period.
Every reform benefits some and disadvantages others. The losers become militants determined to resist it. The beneficiaries form the cadre of individuals and groups to defend the new order. These reforms generated resistance, most especially from Makerere University students whose allowances were removed. But resistance was limited because economic collapse had discredited the beneficiaries of the old order.
For example, it was not difficult to return businesses, properties and industries confiscated by Amin in 1972 to their previous owners because those who had taken them over had run them down. Failure had discredited their cause and their resistance to reform did not attract much public sympathy. Equally, the corruption, favouritism and incompetence in public enterprises had discredited them as vehicles for serving the common good. And most importantly the NRM had been a largely rural based movement and these institutions and their office holders did not form its core political base. So there were hardly any bureaucratic and political insiders to sabotage reform from within as happened to many other African countries. Besides, Museveni enjoyed such widespread dominance inside the NRM that his left-wing allies simply deferred to him on these reforms.
Most of Uganda’s reform was carried out by civil servants led by Tumusiime Mutebile in the Ministry of Planning which later merged with the Ministry of Finance. Around him was a group of officials like Chris Kasami, Keith Muhakanizi, Lawrence Kiiza, Damon Kitabire (left for ADB, later to IMF), Mary Muduli (left for ADB) and Mary Kutesa (left for IMF) etc. This group was inherited from the Milton Obote II administration where they had tried to reform Uganda’s economy to a more liberal dispensation. They were convinced that liberal reforms are necessary for Uganda’s economy to recover.
Donors proved adept at patronage. They pampered them, supplemented their salaries with dollar stipends, organised trips abroad for conferences and workshops for them. They took them to do fellowships at prestigious universities in America and Britain. They also gave them internships at the head offices of IMF and World Bank in Washington DC.